Medicare is an important part of any senior citizen (or eligible individual)  in one way or another. That is why it is unfortunate that so many people don’t have a clear understanding of what Medicare is. It’s critical that people understand what Medicare is and how it can be a great option for those specifically aged at least 65 years old, people with eligible disabilities, and people with end stage renal disease. It may be hard to understand at first but with information like this article hopefully you can get a better idea! Simply put, Medicare can be understood in 4 parts:

• Hospital Insurance (Part A)
• Doctors and Tests (Part B)
• Medicare Advantage (Part C)
• Prescriptions (Part D)

Hospital Insurance (Part A)

Many people deal with the cost of hospitalization, especially those eligible for Medicare. That is why this coverage is automatically provided to the recipient if they are a part of Medicare. This coverage isn’t completely free and individuals can expect to be responsible for a deductible worth $1,484 for each benefit period.

Part A covers many different types of services like:

• Inpatient Care at Specified Locations (Like Hospitals or Religious Non-Medical Healthcare Facilities)
• Surgeries
• Home Healthcare Services
• Hospice Care (Only Medicare-Approved)
• Nursing Facilities

Doctors and Tests (Part B)

Another important part of Medicare is Part B. This is important because it covers a variety of services which include:

• Ambulance Services
• Cancer Treatment
• Cardiac Rehabilitation
• Clinical Research
• Doctor’s Visits
• Durable Medical Equipment (DME)
• Mental Health
• Outpatient Services
• Preventative Services
• Purchase of Blood

If an individual has another source of creditable coverage then they will not be required to have Part B. Creditable coverage can be provided from sources like an employer. If you do not have this creditable coverage and do not enroll in Part B then you may be subject to penalties if you choose to enroll at a later date. In 2021, the cost of Part B coverage is $148.50.

Understanding Part A and B Coverage (What Does it Mean to You)

Medicare Parts A and B are a great foundation of a health insurance plan. However, just having these two parts may not be the best option for individuals that want to have adequate long-term care coverage. Individuals with chronic conditions that require a hefty load of care will likely not feel the ease of mind of sufficient coverage. This can make it hard for people with Medicare because it’s not uncommon to see people need long-term care for the remainder of their lives. These parts don’t provide coverage for:

• Acupuncture
• Cosmetic Surgery
• Dentures
• Eye Care
• Hearing Aids
• Long-Term Care
• Most Dental Care
• Routine Foot Care

Medicare Advantage (Part C)

Also known as Medicare Advantage, Part C essentially acts like another option compared to traditional Medicare coverage. Typically, this coverage consists of all parts (Parts A, B, and D) along with some other benefits (depending on the plan you choose). This part is provided by Medicare-approved private insurance companies.

Prescriptions (Part D)

Over 131 million Americans use prescription drugs. This number may not seem like too much but it is roughly equivalent to 66% of all adults in America. Since so many people rely on prescription drugs, Medicare Part D focuses on prescription drug coverage. Part D is not the same as Parts A and B because it is only administered by private insurance companies. This coverage is not required (like with Part B) and is entirely optional. Since every plan is unique, you will be able to confirm the specific terms when going through the process of getting this insurance plan.

What is Medigap Insurance?

So another option that people encounter is Medigap insurance (also known as Medicare Supplemental Insurance). Private insurance companies offer this policy as a coverage option to handle the areas that traditional Medicare (Parts A and B) don’t cover. Medigap has an open enrollment that begins on the first month a person turns 65 years old and is enrolled in Part B Medicare. Medigap coverage works hand in hand with your Medicare Coverage.

Let’s go over an example! Let’s say that you go to a hospital and receive both Medicare-covered services and non-Medicare-covered services. The first thing that’s gonna happen is Medicare will cover the costs that it can. After that, Medigap will pay for their portion of covered services. It’s not as complex as it may seem! That is why when looking through different Medigap policies you can usually expect to see the same basic coverage but then see plans that have additional coverage.

Understanding Medigap Coverage

Medigap coverage can be extremely useful to Medicare-recipients that need extra coverage. Some points that can help you understand Medigap include:

• Medigap plans are not a kind of Medicare Advantage.
• Part D of Medicare (prescriptions) is not a kind of Medigap plan.
• Employer health coverage is not a kind of Medigap plan.
• Union health coverage is not a kind of Medigap plan.
• TRICARE is not a kind of Medigap plan
• The Federal Employees Health Benefits Program (FEHB) is not a kind of Medigap plan.
• Veteran Benefits are not a kind of Medigap plan.
• Long-Term Care Insurance is not a kind of Medigap plan.
• To receive Medigap coverage, an individual will need both Parts A and B of Medicare coverage.
• Medigap policies are meant for one person.
• If you drop Medigap coverage you may struggle to get it back.
• A Medigap plan will have a monthly premium.
• If you have a Medicare Advantage plan you cannot get a Medigap policy.

What is the Difference Between a Medicare Advantage Plan (Part C) and a Medigap Plan?

You will notice that the first bullet point says that Medicare Advantage plans are not a kind of Medigap plan. This can be confusing since both are a way to handle the lack of coverage that Medicare Parts A and B come with. Luckily, the difference isn’t as hard as it may seem. To put it simply, Medicare Advantage plans are another way to get traditional Medicare (Parts A and B). On the other hand, Medigap works with your traditional Medicare coverage. There are plenty more differences when it comes to the benefits, costs, and how they work but this is just the basic difference.

Understanding Medicare

Now that you have a basic understanding of the different parts of Medicare, you can begin to learn what Medicare means and how it can be beneficial.

Traditional Medicare

Also referred to as Original Medicare, this plan coverage works very simply. It is based on the fact that a service is exchanged for a fee. This means that when an individual receives a medical treatment done by a doctor or hospital, then Medicare is responsible for paying a portion. The portion that Medicare pays is only for the Medicare-covered services. Any other expenses from non-Medicare-covered services are the responsibility of the covered individual. People usually handle these costs with other insurance coverage that are designed to handle the expenses that traditional Medicare doesn’t cover.

What’s the Difference Between Medicare and Medicaid?

A lot of Americans confuse these two options because they have similar names. However, there is a difference which is important to know so that you can have a clearer understanding of Medicare.

Medicare is a government health insurance program for individuals at least 65 years old, individuals with an eligible disability, and those with permanent kidney failure that requires dialysis or a kidney transplant. On the other hand, Medicaid is a state and government funded assistance program that aims to provide health coverage to individuals that meet financial qualification requirements.

Medicare Eligibility

If you want to determine your Medicare eligibility, you can review online with a Medicare.gov eligibility tool. That will be one of the easiest ways to confirm your status. However, you can generally assume that people at least 65 years old could qualify for Medicare coverage. Other individuals like those with eligible disabilities and people with end-stage renal disease could be eligible too.

How to Get Medicare Coverage?

If you want to get Medicare coverage, you can sign up for Parts A and B once you are at least 65 years old or meet other eligibility criteria. Sometimes people may find that they get enrolled automatically. If you are interested in finding out more you can always go on Medicare’s website!

Overall

Medicare isn’t as simple as most people think it should be. To better understand Medicare, you should break it down into four parts to better know the coverage you will receive. Traditional Medicare (also referred to as Original Medicare) consists of Part A and Part B (if you don’t have a source of creditable coverage). There are other optional parts that you can get like Parts C and D. Some people find that getting additional coverage like a Medigap policy is right for their situation. For more information about what is right for your lifestyle and budget, you can call the Medicare office at 1-800-633-4227.