MEDICARE 101

Medicare is a federal health insurance program for people age 65 or older, people of all ages with disabilities, and people with End-Stage Renal Disease (ESRD) or ALS — Lou Gehing’s Disease.

Who is Eligible for Medicare?

People who are at least 65 years of age

  • Worked 10 or more years in Medicare-covered employment, and paid ( or spouse paid) Social Security for at least 40 quarters.
  • Are citizens or permanent residents of the United States.
  • Have been diagnosed with ESRD or ALS.

People who are not yet 65 years of age

  • After 24 months of Social Security Disability Insurance income.
  • Have been diagnosed with ESRD or ALS.

Original Medicare Plan

People with Original Medicare are called beneficiaries. Beneficiaries can go to any doctor, supplier, hospital, or other facility that accepts Medicare and is accepting new Medicare beneficiaries.

Beneficiaries with Original Medicare are responsible for a deductible and coinsurance for most covered services. The deductible is the amount a beneficiary must pay before Medicare begins to pay for services and supplies covered under the program. Coinsurance is the share of the cost for services that the beneficiary is responsible for after the deductible is met (normally a 20/80 percentage).

There are no maximum out-of-pocket limits for Original Medicare.

To help pay for some of the healthcare costs that Original Medicare doesn’t cover, beneficiaries may choose to purchase Medicare supplemental health insurance (Medigap policy). They may also choose to enroll in a Medicare Prescription Drug Plan (Medicare Part D) to receive prescription drug benefits.

Medicare beneficiaries are required to have Prescription Drug Coverage. If you don’t have coverage at least as good as Medicare Part D from an employer, union, or military, you will have to pay a penalty for each month you don’t have Part D coverage.

Services Typically Not Covered Under Original Medicare

The Four Parts of Medicare

Medicare is made up of four parts. The following information is to help you understand each part of Medicare.


Inpatient Hospital Insurance
Medicare PART A

Eligible individuals are automatically enrolled in Part A with no premium. Others apply to the program when they are eligible or pay a monthly premium if they have worked less than 40 quarters (or 10 years) in their lifetime.

Covers

  • Helps cover inpatient care in hospitals (includes critical access hospitals, inpatient rehabilitation facilities and long-term care hospitals).
  • Helps cover skilled nursing facilities (not custodial or long-term care), hospice and home healthcare services.

Does not cover

Physician services in the hospital, personal care items, private rooms (unless medically necessary), phone, television, and custodial care, such as assistance with eating, bathing, and getting dressed.

Limitations

There are some limitations of the number of hospital days covered for inpatient hospital coverage. Days 1-90 in a hospital stay are covered, and days 90-150 are only covered once in your lifetime. These days are called “lifetime reserve days.” Deductible and copayments apply after 150 days. Providers must accept Medicare and be accepting new patients.


Outpatient/Physician Insurance
Medicare PART B

To obtain Part B, an eligible individual must enroll at their Social Security office during a specific period (usually the month of your birthday and the three months before or after your birthday month).

Learn more about Medicare Part B Premium

Covers

  • Part B is voluntary and is designed to supplement Part A coverage.
  • Helps cover doctor services, outpatient care, and durable medical equipment (DME).
  • Helps cover some preventive services to help maintain a person’s health, now including an annual wellness visit.

Does not cover

Routine vision, alternative healthcare, routine hearing screening exams, preventive or restorative dental services, routine chiropractic care, prescription drugs, and first three pints of blood.

Limitations

Part B only covers care for eyes, teeth, or hearing when medically necessary. No coverage for custodial care, such as assistance with eating, bathing, and getting dressed. No coverage outside the United States.


Medicare Advantage Plans
Medicare PART C

Sometimes called an “All in One” plan, Medicare Advantage plans are a way to get Medicare benefits through private companies approved by and under contract with Medicare.

Covers

  • Includes Part A, Part B, and usually additional benefits Medicare doesn’t cover (such as fitness benefits, chiropractic care, or vision and hearing benefits).
  • Often includes Part D Coverage.
  • Benefits that go beyond Original Medicare such as out-of-pocket maximums.

Does not cover

Hospice Care (still provided by Original Medicare). It’s important to review each plan carefully tosee what it does and does not cover.

Limitations

Coverage options vary by plan and plan type. It’s important to review options carefully. Medicare Advantage plans do not have the same network as Original Medicare.


Prescription Drug Coverage
Medicare PART D

These are plans that help cover prescription drug costs. Plans are available through private companies that contract with Medicare to provide coverage. Each plan can vary in monthly premium and drugs covered. If an individual does not have creditable coverage (coverage equal to Original Medicare) they are subject to a penalty for each month they are not enrolled.

Covers

  • Part D is voluntary and is designed to supplement Part A and B coverage because the beneficiary pays for the coverage, while Part A and Part B have government funding.
  • All drug classes mandated by Medicare.

Does not cover

Drugs not on the Medicare formulary and certain drugs that are covered under Part B.

Limitations

Coverage options vary by plan and plan type. It’s important to review options carefully.

Medicare Insurance FAQ

Many people use Medicare supplemental insurance to augment their current insurance plans. Medicare supplemental insurance is important because it provides individuals with a way to purchase their necessary drugs and it gives them protection if they ever enter the hospital for an extended period of time. Though there are a huge number of people who use Medicare as their only means of funding medical coverage, those individuals with employer-provided health care plans and personal health care plans are able to use Medicare for this supplemental element. It can act as a powerful policy for covering any over the top costs that typical insurance policies might miss.

When we talk about the program, we have to start at the beginning. Medicare Part A is one of the biggest portions of the coverage and it’s arguably the most important.

Medicare Part A is actually the hospital insurance consideration that goes into the program. One of the biggest costs associated with getting sick has to do with staying in the hospital. As many have figured out, hospitals charge big bucks for extended stays and these things can really add up over the course of many months

Medicare Part A makes sure that people have coverage for their extended stay, a semi-private room, food, tests, and any doctor’s fees that go along with the stay. Medicare Part A will cover a person for a 100-day hospital stay, with the first 20 days being completely covered and the last 80 days being covered with a patient co-pay of roughly $161.

While the first part deals with the costs associated with going to the hospital, Medicare Part B takes time to cover the elements not readily covered in the first provision.

The main considerations in this portion of Medicare are outpatient procedures, since Part A is much more interested in covering long term hospital stays. For patients who need tests like X-rays, CT-scans, and MRI procedures, Medicare Part B is what makes that happen.

It covers any sort of evasive treatments, like blood transfusions or transfers. Another very important part of the Medicare Part B coverage has to do with the coverage for things like wheelchairs and walking canes. It also provides eyeglasses and breathing oxygen, among other things.

A more complicated part of this government plan is known as Medicare Part C. This has also been referred to as the Medicare Advantage plan, and it provides options for people who have reached qualifying age.

This is the part of the Medicare plan that allows people to still get their applicable benefits through a private insurance plan. Medicare Part C has been very important for those people who have their own insurance, but still want to benefit from the Medicare that they have already paid for over the course of their lives.

When a person signs up for Medicare Part C, they are usually given a list of private health insurance companies that they can use, and they will pay a monthly premium on top of the Medicare provision for things that might not be covered by Part A and Part B. Some of those things include prescription drugs, which makes up an important cost for many older people. This is a plan that many fewer people take advantage of, but it provides a big time level of coverage.

For many people, Medicare Part D is the most important part of the program. This is what covers the prescription drug needs of many individuals and it helps to save money for these older people.

Medicare Part D is a relatively new creation in terms of the government program, having only been in effect since 2006. Under the provisions set forth in Medicare Part D, any person who has Part A or Part B is also eligible to be covered by Part D.

This portion of Medicare covers almost all drugs that a person might need, and those who want to enroll have to choose a stand-alone prescription drug plan (PDP). The drugs that are not covered under Medicare Part D are usually covered by Medicaid for people who qualify for both plans.

There are many Medicare benefits that people can take advantage of.

As mentioned above, the ability to have a hospital stay that is almost three weeks without ever having to pay a dime is one of the most important Medicare benefits out there today. Depending upon which part of the plan you qualify for, you could have a host of Medicare Benefits at your disposal. The long-term hospital benefits are important, as are the outpatient procedures that are also covered.

Part D has been the most starting of the plans, since it allows people to get the drugs that they need in order to survive. These are all equally important Medicare benefits that beneficiaries have been fortunate to receive.

There are some Medicare supplemental plans that are available in addition to the standard coverage options.

These Medicare supplemental plans are known as “Medigap” policies and they seek to bridge the gap in needs for special individuals.

These Medicare supplemental plans used to taken out to cover the costs of prescription drugs. These days, they are taken out more to bridge the things that aren’t covered in Part A or Part B. This could include long term health care such as a hospital stay that’s longer than 200 days. This type of coverage has become less popular since Part D passed in 2006.

Important Medicare Contacts

Social Security Department

1-800-772-1213
TTY: 1-800-325-0778
http://www.ssa.gov


Enroll or waive Medicare and discuss income assistance programs.

Medicare

1-800-Medicare (1-800-633-4227)
TTY: 1-877-486-2048
http://www.medicare.gov


For Publications and Questions about Medicare and to talk with a customer service representative 24 hours a day, 7 days a week.

CDA Insurance LLC

(541) 434-9613
(800) 884-2343
http://www.cda-insurance.com/


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