Medicare Insurance

Medicare is health insurance coverage provided by the United States government to provide individuals over the age of 65 with health insurance coverage. This also helps provide health insurance for individuals with end-stage renal disease and who have been receiving social security disability for more than 24 months. Medicare has four parts.

Medicare Part A

Medicare part A covers inpatient hospitalization. There is a first day deductible that must be reached every new visit, unless it is within three days of the discharge from the last visit for a related condition. That deductible changes every year. The cost for Medicare Part A is generally $0/month provided the beneficiary has worked and paid in to the Medicare benefit for at least 30 quarters. Individuals may also become eligible by collecting on their spouses benefit or as the result of a qualifying disability for more than 24 months. Individuals typically age-in to Medicare at the age of 65. Because most Americans receive Part A at no monthly cost, most eligible beneficiaries are automatically enrolled.

Medicare Part B

Medicare Part B generally covers outpatient services such as doctors visits and lab work. This coverage comes with an annual deductible and a monthly cost. The monthly cost is a premium deducted from the social security check of an eligible beneficiary and usually changes every year. From a little while it was income dependent so individuals making in excess of $200,000/year or couples making in excess of $400,000/year would pay extra. This coverage for outpatient services would include things like primary care visits, specialists, physical therapy, blood work, and even durable medical equipment.

Medicare Part C

Medicare Part C has been around since 1985 and in short, is private Medicare plans provided through contracts with Centers for Medicare and Medicaid Services, often referred to as CMS. Currently these plans are referred to as Medicare Advantage plans and they typically provide more benefits for seniors than original Medicare and usually have little or no additional monthly premium. These plans typically take one of a few different forms.

Medicare PPO Plans

A PPO is a Preferred Provider Organization which basically means what you might think. There are providers that the Medicare Plan will want the beneficiary to use and as such they’ll typically provide a reduced copay in exchange the patient visiting a contracted provider. Beneficiaries are welcome to see any doctor they wish outside of the network and if they do they will typically have a higher cost share in terms of a copay or deductible, but they will still be able to use their health insurance coverage.

Medicare HMO Plans

An HMO is a Health Maintenance Organization which provides a network of providers a beneficiary can use, but it is restrictive in the sense that the beneficiaries are required to use those physicians only. In the event there is a network deficiency and their are no providers in a particular area that are available for the beneficiary to visit, they have the option of visiting any provider they wish at the same cost sharing as an in network physician. They also have the ability to seek urgent and emergency care at any provider they need, regardless of the proximity of other providers that are in the network.

Medicare PFFS Plans

PFFS are a bit like PPO plans in the sense that the beneficiary may be able to see any physician they like, but they will be restricted to physicians that agree to accept the terms and conditions of a plan. As a result of the change in recent legislation many PFFS plans are also building networks so these plans typically work more like a PPO plan, but in fact they are different.

Other Medicare Plans

There are other types of Medicare plans that fit under the group of Medicare Part C, but we won’t be covering those here. We would however be negligent to not at least mention that they exist.

Medicare Part D

Medicare Part D is also known as the prescription benefit. This is a relatively new benefit that was introduced as a part of the Medicare Modernization Act of 2003. This program allows individuals to enroll in Part D plans that are also contracted with CMS for a relatively low monthly premium and receive prescription drug coverage. This coverage does have gaps and limitations, but it has helped millions of seniors with the cost of their prescription drugs.