Medicare is easy right? Part A, B, C, D? At first glance you would think it would be! Let’s take a look at the different parts of medicare. Being educated about the different parts will help you make a decision about what plan may work best for you.
Medicare – A brief background
Medicare is a Federal health insurance program designed to pay for a majority of seniors health care expenses. Medicare is normally designed for those who are of age 65 and older. These individuals are referred to as Beneficiaries. CMS or the Center for Medicare and Medicaid administer Medicare. CMS is a division of the U.S. Department of Health and Human Resources. Even though Medicare was designed for Seniors 65 and older, some individuals may qualify under the age of 65 if they are disabled or have certain approved medical conditions.
Medicare is granted based on a points system. You earn points based on the years that you have paid into medicare. A beneficiary will need 40 points or “quarters” to qualify for the full part A benefit. If all the points are not acquired, the beneficiary may have to pay a fee or premium to be covered. Medicare is an entitlement program similar to Social Security.
Medicare, as mentioned earlier, is comprised of four parts, or “Letters” to make it easy to identify. Parts A, B, C and D make up the four parts of the program. Medicare parts A and B are often referred to as Original Medicare. Part C is a private health insurance plan known as Medicare Advantage and Part D offers prescription drug coverage.
Now let’s take a look at the different parts of Medicare.
Medicare Part A
Part A covers hospital insurance. Think of “buildings”. It covers inpatient hospital care, nursing care facility for a limited time, limited home health care services, and hospice care.
For the most part, most beneficiaries won’t pay a Part A premium due to the amount of “points” they have accrued over their life of working. These points are calculated by the number of quarters they have worked and paid medicare taxes on. This is over a 10 year span. If you have worked this timeframe and earned enough points, the beneficiary will be eligible for a free Part A plan. If they did not, they will be required to pay a monthly premium.
Medicare won’t cover all of the hospital stay typically. Most beneficiaries will have a cost associated with this. Beneficiaries will also need to pay a deductible before medicare will start paying. Medicare will then pay up to 60 days in a hospital at 100%. Part A will pay up to 20 days in a skilled nursing facility. After the 20 day period, after 20 days, the beneficiary will pay a flat amount up to the maximum amount of days. Reserve Days – Reserve days are longer than 90 days in a hospital. Beneficiary is granted a total of 60 lifetime reserve days.
Medicare Part B
Medicare part B covers non-hospital expenses such as doctors, office visits, blood test, diabetic screening, X-rays, and outpatient hospital care. Think of Part B as “People”. Medicare Part B does have a premium and that premium can be higher for beneficiaries with higher incomes. In some cases, for lower income beneficiaries, Medicaid can help cover Part B premiums. The premium for Part B can vary from year to year.
With Part B, medicare beneficiaries are responsible for a portion of their health costs. Part B does have a deductible associated with it. Medicare Part B pays 80% and the beneficiary pays the remaining 20% when seeing a participating doctor.
Medicare Part C
Medicare Part B is also known as Medicare Advantage. This plan is designed and offered by specific insurance carriers and often covers everything is one health plan. It is packaged as an alternative health care plan by carriers that are contracted through CMS. This is an optional plan , however to qualify you must have your Medicare Part A and Part B. You may also have to pay your Medicare Part B plan if you have a Medicare Advantage plan.
Many Medicare Advantage Plans cover Prescription drug coverage. In addition, the plans can include different benefits that vary by carrier. Some deductible vary depending on the plan and carrier. Medicare Advantage plans may even cover certain health care services that Original Medicare, Part A and Part B, does not cover, like eye exams, hearing aids, dental care, or health care received while traveling outside the United States.
Medicare Part D
Medicare Part D coverage prescription drug coverage. This is an optional plan. It is available as a standalone plan that can be purchased in addition to your medigap plan or in combination with medicare Advantage plans. The cost for these plans vary depending on the plan type and carrier. The plans can have a deductible, a flat copayment amount, or a percentage of the full drug cost.
If your income is limited, and can not afford your medications, even though you receive Part D benefits, you may be able to get assistance with your monthly premium, copay, coinsurance and deductibles.