Medicare is a federally funded health care insurance program created for individuals 65 and older, people with certain physical limitations who are under 65 and others who have permanent kidney failure. If you fall into one of the three categories listed, you usually can obtain medical coverage through the program. Medicare has four main coverage parts: Part A Coverage, Part B Coverage, Part C Coverage and Part D Coverage. These parts cover a range of health services, including physician visits, inpatient hospital stays, surgeries, lab work and prescription drug coverage. It is important to understand all the different parts and aspects of the program and coverage, your rights within the program, how to locate the right option for you and how to lower your overall costs.
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Breaking Down Medicare
Stating Medicare is a simple program to understand would be silly. In fact, numerous whole books have been created to help individuals understand the Medicare program. Even the infamous “For Dummies…” series took a crack at helping others understand the Medicare system. And even if you’re not a dummy, the topic is terse, tedious and usually confusing. The easiest way to help you understand the behemoth health insurance program ran by the United States government is by breaking it down into parts. By breaking down the program into parts A, B, C and D – we can begin to explain Medicare in an easily digestible manner.
Understanding Benefit Periods
Before diving deep into the Medicare system, it’s important to understand benefit periods. While most related to Medicare Part A, a benefit period is the way Medicare measures your use of hospital and nursing services.A benefit period starts the day you go to the hospital or skilled nursing facility. The period ends when you haven’t received any hospital or nursing services for 60 days in a row. There is no limit to how many benefits periods an individual can have. However, there is a new deductible for each new benefit period.
What Is Medicare Part A?
In layman’s terms, Medicare Part A covers hospitalization services for covered individuals. These services are only covered from healthcare providers who accept Original Medicare coverage. Some examples of services covered include surgery, inpatient rehabilitation, hospice, skilled nursing facility care and more. It is important to note that deductibles for Medicare Part A do not work like most medical deductibles. While deductibles for most medical plans applies once a year, each benefit period an enrollee experiences has its own deductible in Medicare Part A.
What Is Medicare Part B?
Part of the Original Medicare program – Medicare Part B covers outpatient medical services like doctor’s visits and preventative care measures such as cancer screening, diabetes screening and flu shots. Individuals utilizing Medicare Part B will pay monthly premiums. Individuals with higher incomes will see higher premiums with the program. Medicare Savings Programs are available to help individuals with lower incomes afford Medicare costs related to Part B.
Is Medicare Part C Actually Medicare Advantage?
The Medicare Advantage Program was created in 2004 when the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) was passed. The Medicare Advantage Programs created when the MMA was passed to replaced the old “Medicare + Choice” plans previously available as an alternative to the Original Medicare fee-for-service plans. This is why the Medicare Advantage Program is often referred to as Medicare Part C. Basically, a Medicare Advantage plan is a Medicare health insurance policy that is offered by a private insurance company. Medicare reimburses companies a certain fixed amount for each member based on his or her risk. Many Medicare enrollees choose an Advantage plan over Part A and Part B because Advantage plans can include more benefits. Vision, dental, hearing and wellness plans are often a part of Medicare Advantage plans. These plans usually require a higher monthly premium and will require co-pays for services.
What Is Medicare Part D?
Medicare Part D plans, also known as Medicare Prescription Drug plans, provides the prescription drug coverage that is not available in other areas of the program (Part A, Part B, etc.). The only way to get Part D coverage is to enroll in a plan run by a private health insurance company that has been approved by Medicare. As such, Medicare Part D plans can vary wildly in cost and drug coverage. Individuals enrolled in any Medicare Part D plan will face out-of-pocket costs associated with their specific prescription drug plan each year. Typically, Medicare Part D plans will have consumers pay a monthly premium. At a certain level your premium will be based upon your income (joint income if married). Some Medicare Part D plans have deductibles, but every drug plan involved with the program has a cap on deductibles. In 2015, the maximum annual deductible for Medicare drug plans is $320.
Dental, Hearing, Vision & Wellness
Dental, hearing, vision and wellness programs are not parts of the Original Medicare program (Parts A & B). However, a number of Medicare Advantage programs do offer all four to enrollees.
If any of the benefits above are important to you, you’ll want to research Medicare Advantage plans that offer the benefits you desire or need. Just beware – you’ll often end up paying more for any additional benefits you require.
Medicare & You
The Medicare program was created to help seniors with the rising costs of medical care as one grows in age. And the programs can do just that, but you must select the right plan for you. As you select a program geared towards your needs, you should be on the lookout for scams and make sure you have educated yourself on the options available. As with any form of health insurance, Medicare can be difficult to understand – not too mention frustrating and often, costly. If you’re struggling to choose a plan that suits your needs, you may want to reach out to a Medicare specialist. Someone who can help you navigate the Medicare waters without reading a book designed for dummies.