Medicare, plain and simple, is a federally funded health care plan for individuals over the age of 65 and for those under 65 who have qualifying disabilities including End-Stage Renal Disease (ESRD) and Lou Gehrig's disease. More than 45 million Americans currently depend on Medicare to help cover the cost of their hospital stays and doctor's visits.
Even though a large number of Americans are enrolled in Medicare, many of them do not understand their Medicare benefits and many Americans do not even know what Medicare really is. Medicare can be quite confusing to those reading about it for the first time so, if you want to learn about this health care program, start with the basics.
Who is Eligible for Medicare?
American citizens who are not already enrolled in a health care plan will be automatically enrolled in Medicare parts A and B when they turn 65 provided the individual or the individual's spouse has worked for at least 10 years and had Medicare taxes taken out of his or her paychecks. Individuals younger than 65 may qualify for Medicare if they have received Social Security or Railroad Retirement Board disability benefits for at least 24 months or if they have End-Stage Renal Disease.
How Do I Enroll in a Medicare Program?
During the year you turn 65 you have the option to enroll in a Medicare program anytime during the period beginning three months before the month of your birthday and ending three months after. If you do not take steps toward enrolling yourself you will be automatically enrolled during the month of your birthday. If, once you begin to receive Medicare benefits, you want to add or drop benefits or switch to a different plan you have the option of doing so during the Annual Election Period (AEP) which runs from November 15th to December 31st of each year.
What Do Medicare Benefits Cover?
When an individual signs up (or is automatically enrolled) for Medicare coverage he or she will be receiving hospitalization insurance (Medicare Part A) and medical insurance (Medicare Part B). Medicare Part A covers overnight stays in hospitals and some skilled nursing facilities and it also covers any IV fluids or medications you may receive during your stay. Medicare Part B helps to cover the cost of visits to doctors and specialists in addition to lab work and outpatient services. Collectively, Parts A and B are referred to as Original Medicare.
Individuals already enrolled in Original Medicare have the option of adding a Medicare Advantage Plan to help cover the costs that Original Medicare does not cover. Medicare Advantage Plans are offered by private insurance companies approved by Medicare and they combine the benefits of Original Medicare with additional benefits such as lower copays and prescription drug coverage. Medicare Advantage Plans come in a variety of forms such as the HMO or Health Maintenance Organization, the PFFS or Private Fee for Service Plan, the NPFFS or Network Private Fee for Service Plan, and the PPO or Preferred Provider Organization. Each of these plans comes with different premiums and benefits – an individual has the ability to choose which plan best suits his or her particular needs.
Medicare Part D encompasses stand-alone prescription drug plans. Original Medicare does not provide prescription drug coverage and not all Medicare Advantage plans include benefits for prescriptions. Like Medicare Advantage plans, prescription drug plans (PDPs) are offered by private insurance companies approved by Medicare. Each plan comes with a different premium so it is up to the individual to choose the plan that is best for him or her.
How Much Does Medicare Cost?
Depending on which Medicare plans in which you are enrolled, your costs may vary. Typically, Medicare Part A is premium-free and the currently monthly premium for Part B is $96.20. On top of monthly premiums, Medicare beneficiaries are also responsible for paying copays (a fixed dollar amount paid per service) and coinsurance rates (a percentage of the total cost of a service which the member must pay). For Medicare Part A, members are required to pay a $1,100 deductible over a 90 day period before they are able to receive any coverage. On top of this deductible, the member is also responsible for paying 20% coinsurance per service or hospital stay.
Medicare Advantage plans provide a cost-effective alternative to Original Medicare. While beneficiaries must continue to pay their Part B monthly premiums, if they are enrolled in a Medicare Advantage plan they will not be responsible for such high deductibles and coinsurance rates. Generally, Medicare Advantage plans make health care more affordable by contracting with health care providers to lower the cost of services for their members. For most Medicare Advantage plans, members are responsible for a lower deductible than Original Medicare requires and they are also responsible for copays rather than more expensive coinsurance rates. Prescription drug plans, whether purchased as stand-alone plans or as part of a Medicare Advantage plan vary in cost depending on the prescriptions an individual needs.
Medicare provides more than 40 million Americans with health care coverage that they might not otherwise receive. By automatically enrolling seniors in a Medicare program, the United States government has ensured that senior citizens get the health care they need. Another important benefit of Medicare is that no one can be turned down – as long as an individual meets the age and citizenship requirements, he or she will be able to receive Medicare.
For more information about Medicare prescription drug coverage and the coverage gap, click here.
References
Medicare.gov. "Medicare Benefits" (accessed November 15, 2010).
Medicare Website. " Medicare Eligibility Tool " (accessed November 15, 2010).
Katherine Barrington - Katherine has loved reading and writing for as long as she can remember. When it comes to reading one of her favorite authors is Tamora ...
