Essentially, Medicare is a health insurance program by the US federal government, sponsoring healthcare services. Medicare services cover individuals living in the US who are 65 years and above, but they can also cover individuals with specific diseases and some young people who meet specific criteria. While Medicare offers plenty of benefits, it is worth noting that it does not cover all your medical costs.
Medicare’s Purpose
Overall, Medicare is designed to offer national healthcare coverage for people aged 65 years and above. 65 was the typical retiring age, which meant that one would no longer have access to health insurance coverage via their employer. Prescription and healthcare costs also tend to increase at this age.
It is also a viable option for individuals with End Stage Renal Disease and specific disabilities. Most individuals with kidney failure or disabilities cannot work, so they have no access to health care coverage through an employer.
The purpose of Medicare is to ensure that older people and those with disabilities or specific diseases have access to affordable health care services. These services are otherwise costly when individuals pay for them out of pocket.
Medicare Coverage Plans
Medicare is divided into four primary parts that cover different things says Medicare specialist from clearmatchmedicare.com. These are alphabetically named from A to D. Often, Medicare part B and Medicare part A are referred to as the Original Medicare. C and D are newer Medicare options. If you want Medicare coverage, you can get it through Original Medicare. Alternatively, if you qualify, you can apply for the Medicare Advantage plans, which require you to be based in the service area of the plan you are interested in joining.
Medicare Part A
Part A of Medicare is hospital insurance that covers a nursing facility or hospital stay cost. However, it does not offer coverage for long-term care. It is also worth stating that medicare part A will not cover any costs of the treatments you will get when you are in the hospital. Below are the bills that Medicare part A covers.
- Inpatient care at skilled nursing facilities
- Home healthcare
- Inpatient care in a hospital
- Hospice care
Medicare Part B
This Medicare insurance covers your visits to the doctor, preventative services, and medically necessary services.
Preventative services mean the health care needed to detect and treat a condition in the early stages. On the other hand, medically necessary services are tests, supplies, and services that diagnose and treat a medical condition you may have.
Medicare Part C
Medicare Advantage or Medicare part C is a type of private insurance, and enrolling for this service is voluntary. These medical plans are often sold via insurance firms contracting with the federal government. All the Medicare part C plans have to offer similar coverage as part A and B, although the additional benefits may vary depending on the plan you are getting.
It is worth mentioning that most of these plans offer prescription drugs coverage, and they may also offer a bundle coverage surpassing what is covered by the original Medicare plans. This can include dental, hearing, and vision coverage.
Medicare Part D
This plan is provided through private insurers and covers prescription drugs costs. The prescription drugs covered include the ones you get through a mail-order or your local pharmacy. Individuals who enroll for Medicare part D pay monthly premiums. There are enough private insurers per state that you can choose from if you want to get this Medicare plan.
Medicare Supplement Plans
This is an extra coverage option to the Original Medicare and is often also referred to as Medigap. Usually, Medicare Part A and Medicare part B cover only 80% of the services, and you can cover the remaining 20% by adding a Medigap plan.
This eliminates some of the out-of-pocket costs you may have to incur, as well as the copayments and coinsurance.
Private insurance policies sell Medigap policies. Note if you have a Medicare Advantage plan, you cannot get Medigap coverage.
What is Not Covered by Medicare
As mentioned, Medicare part A and part B only cover a few things. However, Medicare Advantage plans may provide you with additional benefits that these two do not offer. Therefore, when purchasing Medicare part C, it would be best to consider any other specific additional services you may be interested in.
The original Medicare does not cover the listed services:
- Acupuncture
- Routine foot care
- Hearing aid exams and hearing aids
- Cosmetic surgery
- Routine eye exam for prescription glasses
- Dentures
- Most dental care
- Long-term care
Long-term care can be pretty costly, and yet it is not covered by the original Medicare. While Medicaid might cover some of the costs sometimes, it only does that for low-income Americans who have little to no savings.
Medicare Vs. Medicaid
Most people often confuse Medicare and Medicaid, which are two different services. The only similarity they have is that they are both health insurance programs sponsored by the government. They both have different eligibility requirements.
Medicaid is a joint state and federal health program offering healthcare coverage to individuals with a low income. People who receive Medicaid are required to have a limited amount of liquid assets by the state. On the other hand, Medicare is a federal program meant for individuals who are 65 and above or young people with specific health conditions.
Individuals who have Medicaid can get different healthcare services, including x-ray and lab services, home healthcare, hospitalization, and services from nurses and doctors. Some states may extend the coverage to medical transportation, dental services, physical therapy, and prescription drug coverage.
Medicare Fees and Costs
Medicare is not free. There are specific fees and costs associated with Medicare. This include
Lifetime-Reserve Day
This refers to the extra days that Medicare will pay for if you are hospitalized for over 90 days. Note that you have 60 days for your whole lifetime. Medicare will pay for all the covered costs for all of these days, except for coinsurance.
Coinsurance
This refers to the cost you may need to pay for your medical services share after deductibles. Often, this is measured as a percentage of the total bill.
Deductible
This refers to the amount you will have to pay for prescriptions or medical care before your Medicare Advantage plans, original Medicare, or Medicare part D starts paying.
Premiums
This refers to the monthly payments you will have to make in exchange for your Medicare coverage.
Most individuals are not required to pay for Medicare part A since they paid for it while working, through payroll taxes. However, if you have to pay for the premium, it will range between $259 to $471 per month, depending on how long you worked and paid Medicare taxes. You will be charged a $1,484 deductible yearly.
You will not be charged any coinsurance for the first sixty days of your hospitalization. From day 61 to day 90, you will be charged $371 coinsurance. After 90 days, you will be charged $742 coinsurance daily for every lifetime reserve. You will be charged all costs beyond the lifetime-reserve days remaining.
Medicare part B premiums can cost around $418.50, but they will be higher if you have a high income. The deductible will cost $203, while the coinsurance will be 20% of all the costs after meeting your deductible.
The monthly premiums you pay for Medicare part C and Part D will vary depending on the plan. If you take a Medicare part D coverage and have a high income, you will be charged a higher premium.
Applying for Medicare
You will be enrolled for Medicare automatically once you turn 65 and have been receiving social security benefits. Often, if you are eligible, you are signed up in Medicare part B and part A. Below are the ways to apply for Medicare.
- To apply in person, visit your local social security office. Remember to call beforehand to schedule an appointment.
- You can apply via call by calling a toll-free number between 7 a.m to 7 p.m from Monday to Friday. If you are partially deaf or deaf, call TTY 1-800-325-0778. If not, call 1-800-772-1213
- You can enroll on the social security website. As per their administration, the process will take less than ten minutes.
It will be best to sign up three months before or after your 65th birthday or during the month of your 65th birthday. Otherwise, you may be charged permanent financial penalties when you miss this window.
Choosing the right Medicare coverage for you should not be a daunting task. You can seek help from various channels to get guidance on how to go about it and what plan would best suit you. If you are approaching 65, it will help to consider the different Medicare plans since paying for healthcare from your pocket can be pretty expensive. If you have a disability or permanent kidney failure and are below 65, consider applying for Medicare and see if you are eligible. If you qualify for this healthcare service, your medical bill can be reduced significantly.
