What To Know About Medicare?

Medicare is a health insurance program offered by the U.S. federal government. It subsidizes the costs involved in healthcare services. This plan covers older people (Age 65 or above). This plan also covers individuals under 65 years with certain health conditions.

This article focuses on Medicare, types of plans, and eligibility to apply.

As a part/section of the Social Security Act, Congress created this program in 1965. It has different plans depending on the cost and diseases covered. Therefore, people have different choices to choose from.

However, it may be difficult for some people to choose the right plan. Such people can seek help from a broker or agent.

What Are The Types of Medicare Plans

The CMS (Centers for Medicare and Medicaid Services) manages this program. It also offers Medicare insurance policies under the following four categories. They are:

1.) Medicare Part A
2.) Medicare Part B
3.) Medicare Part C
4.) Medicare Part D

Medicare Parts A and Part B are also called original Medicare plans. Predominately, they offer basic hospital (inpatient) and medical (outpatient) coverage. Medicare Part C can be referred to as a combination of Medicare Part A and Part B.

There is also an option to partially cover prescription drug costs through Medicare Part D. All these options are explained briefly below:

1.) Medicare Part A

This plan covers inpatient hospital bills. It also covers treatment bills from hospice, skilled nursing facilities, etc. However, this plan does not cover custodial or long-term care.

Moreover, it automatically covers individuals receiving Social Security benefits. If you wish to enroll, sign up through their official website.

This Plan has co-insurance and also deductibles ($1,484 in 2021). That means patients may have to pay the bills partially. In the case of inpatient care, coinsurance is not available for the initial 60 days.

You may also be eligible for the premium-free version of this plan If you (or your spouse) were employed and paid Medicare taxes for a period exceeding 10 years. Check your eligibility.

2.) Medicare Part B

This plan covers outpatient bills. This includes medical visits, ambulance services, preventive services, and also some medical equipment. In addition, this plan covers mental health coverage and some prescription drugs.

In 2021, this plan’s standard monthly premium is $148.50 and the deductible is $203. However, if you earn more than $88,000 (married couples – $176,000) annually, you may end up paying higher premiums.

Penalties

It is important that you enroll in time for this plan. That is to say, you can sign up during the initial enrolment period (7 months) or special enrollment periods (8 months) when you turn 65.

Otherwise, you have to pay 10% of your premium as a penalty, for each year that you delay, for your lifetime.

3.) Medicare Part C

This plan is also popularly known as the Medicare Advantage plan. Most people prefer this plan because it offers coverage of the previous two plans combined. Some of these plans include certain prescription drug expenses also.

Moreover, some plans may include benefits such as coinsurance, copays, and even insurance costs that are associated with international travel.

Typically, different plans in this category charge varying out-of-pocket costs. They may also have specific rules on how you receive the medical services. For example,

1.) you may need a referral to consult a specialist
2.) You may have to go for doctors associated with this plan, for non-emergency cases.

These rules may change every year, considering various factors. Consumers can purchase these plans from private insurers also.

4.) Medicare Part D

This plan offers prescription drug coverage. If you have enrolled in Part A or Part B plans, it is recommended that you enroll in this plan also. It is because you can get subsidies for prescription drug expenses.

Who Are Eligible for Applying Medicare Plans

In order to qualify, one must have lived within the US legally for a period of at least 5 full years. He should also be 65 or more years of age. People receiving Social Security benefits are also automatically covered in Medicare Part A and Part B policies.

However, individuals have to separately enroll for this plan, if they wish to.

People under 65 years of age can also enroll in these plans if they are receiving SSDI (Social Security Disability Insurance). Anyone suffering from Amyotrophic Lateral Sclerosis (ALS) and some other conditions are waived from this requirement. However, they may require to wait for about 2 years, after receiving their first check.

Typically, the funds for this program come in several ways. The U.S. taxpayers contribute their part through FICA (Federal Insurance Contributions). Similarly, the employees give about 7.65% of their earnings to these programs (Medicare – 1.45%, Social Security- 6.2%). The Employers also contribute similar shares on behalf of their employees.

What Isn’t Covered by Medicare?

In general, these plans do not cover the custodial (long-term) care expenses. However, people with low income can cover these types of expenses through another program called Medicaid.

These plans do not cover some other expenses also including the following:

Many dental programs
Overseas medical expenses
Dentures.
Many therapies including massage therapy
Cosmetic surgeries
Many kinds of eye-related exams and eyeglasses
Hearing aids and procedures for fitting them

What is Medigap?

Some expenses such as coinsurance, deductibles, overseas medical expenses, etc., are not covered by Medicare Part A and Part B. However, you can cover at least some of these expenses through Medicare Supplement Insurance or Medigap.

Many private insurers sell these types of programs. In any case, these programs may also not cover long-term care, dental, prescription drugs, vision, private nursing costs, hearing aids, etc.

In most states, Medigap is available in 10 types of plans. After purchasing Medicare Part A and Part B, you can apply for these plans. However, you cannot purchase Medigap with Medicare Part C. They are incompatible with each other.

CARES Act (2020)

CARES (Coronavirus Aid, Relief, and Economic Security) is a coronavirus stimulus (emergency) package worth $2 trillion. The former US president, Donald Trump, signed this Act into law on the 27th of March 2020.

From then on, Medicare covers COVID-19 treatment expenses also. Additionally, the CARES Act facilitated the following:

1.) Increased Medicare’s flexibility to cover the services associated with telehealth.
2.) Authorized Medicare certification for services pertaining to home health. The patients can avail these services from skilled persons such as certified nurse specialists, nurse practitioners, physician assistants, etc.,
3.) Increased the Medicare payments for durable medical equipment and also Covid 19 patients, staying in hospitals.

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