The Four Parts of Medicare
Medicare is a Federal health insurance program covering millions of Americans aged 65 and older, people under the age of 65 with certain disabilities, and people with End-Stage Renal Disease (ESRD). The Centers for Medicare and Medicaid Services (CMS) is the federal agency that oversees Medicare.
Medicare Part A: Hospital Coverage (Inpatient)
Hospital Inpatient Care: Medicare Part A will pay for all medically necessary services for your stay at the hospital, such as your room, meals, nursing services, drugs, lab tests, X-rays, operating room, and recovery room costs. Medicare does not cover the television or telephone in your room or private duty nurses.
Recovery Care in a Skilled Nursing Facility: To qualify for care in a Skilled Nursing Facility, you must have been an inpatient in a hospital for three or more consecutive days. Skilled nursing facilities provide 24-hour care for people who need rehabilitation services or suffer from serious health issues that are too complicated to be tended at home. However, Medicare only covers up to 100 days in a skilled nursing facility. In addition, Medicare does not cover long-term care or custodial care.
Hospice Care: To be eligible for Medicare’s hospice benefit, a beneficiary must be certified by a physician to have a life expectancy of six months or less. Medicare pays for this kind of comprehensive end-of-life care delivered at home or in a hospice facility. Hospice care changes the focus to comfort care (palliative care) for pain relief and symptom management instead of care to cure the patient’s illness.
Home Health Care: These are medically necessary services that have to be ordered by a doctor. Your doctor must certify that you’re unable to leave your home without some difficulty; in other words, you’re homebound. Medicare home health care is for part-time care and for a limited time. Medicare, in general, won’t cover if the only care you need is custodial such as bathing, dressing, using the bathroom, cooking, cleaning, or round-the-clock care.
Part A is free if you have worked the required amount of time, generally 10 years or 40 quarters, and paid Medicare taxes while working.
Medicare Part B: Medical Insurance (Outpatient)
Part B of Medicare provides Outpatient medical coverage to examine, diagnose, and treat your health conditions. You can receive these outpatient medical services and treatments at a doctor’s office, hospital, or clinic. There is an annual deductible of $233 for Part B medical services, and after the deductible is met, Medicare only covers 80% of Part B medical expenses.
Doctor’s office exam
Preventive services and screenings
Diagnostic and Lab tests (MRI, CT Scan, EKG, X-rays, Blood work, Urinalysis)
Same day hospital visit
Chemotherapy and Radiation treatments
Physical, speech, and occupational therapy
Durable medical equipment
Mental health services
You pay a monthly premium to the government for your Part B coverage. The standard Part B premium for 2022 is $170.10. If your income exceeds a certain amount, your premium could be higher than the standard premium.
If you are currently receiving Social Security Benefits before your turn 65, you will be automatically enrolled in Medicare.
If you are not receiving Social Security Benefits when you turn 65, you need to request your Medicare by either calling your local Social Security office, or you can apply online at ssa.gov.
Medicare Part C: Medicare Managed Care Plans
Part C of Medicare refers to Medicare Advantage Plans (MA Plans). These plans (HMO or PPO) are managed care plans offered by private insurance companies approved by the Center for Medicare and Medicaid Services. These managed care plans are not considered supplemental Medicare coverage. When you enroll in an MA Plan, you receive your health care from the insurance company, not Medicare. Advantage Plans offer the same benefits as Original Medicare Part A and Part B, but they can apply different rules, costs, and restrictions than Medicare does. For example, they can require pre-authorization for medical care or you to get a referral before seeing a specialist and only go to the doctors and hospitals in their provider network.
Medicare Advantage plans have provider networks for doctors and hospitals (HMO or PPO). With Medicare-managed care plans, the limits on which doctors and hospitals you can see and the required pre-authorizations to receive care may be the most crucial drawbacks. Getting a pre-authorization from an insurance company can be difficult and time-consuming. Even if the doctors you currently go to are in the plan’s network, you should consider that your medical needs could change in the future, and you may need to see other doctors who may not be in the network. If you want to see a specialist or surgeon, not in the plan’s network, you’d have to pay some or all of the cost yourself. Another drawback with an MA Plan is there are substantial out-of-pocket costs. Your maximum out-of-pocket could be as much as $7,500 in a calendar year. If you use out-of-network providers, your out-of-pocket cost may be higher.
Medicare Advantage or Disadvantage
Out-of-pocket costs will quickly add up when you get sick with a Medicare Advantage Plan. This is a list of typical copays and coinsurance with Advantage Plans offered in Alabama until you have reached your maximum out-of-pocket for the year.
Inpatient hospital Stay–$295-$325 copay per day for days 1-7
Skilled Nursing Facility–$0 copay for days 1-20
$188 copay per day for days 21-100
Outpatient surgery–$295-$325 copay
Radiation treatments for cancer– $50-$60 copay per treatment
Chemotherapy treatments—20% coinsurance per treatment
Durable medical equipment and prosthetics–20% coinsurance
Kidney dialysis—20% coinsurance per treatment
Physical therapy–$25-$40 copay each visit
Ambulance–$205-$325 copay per one-way trip