Part A covers an inpatient hospital stay after a deductible. It also covers skilled nursing care as well as some limited home health care and hospice care. In most cases there is no cost for Pat A of Medicare.
Part B covers a portion (usually 80% after an annual deductible) of medical services costs, such as doctor visits, procedures, diagnostic tests and other medical services not covered in Part A. There is a monthly premium for Part B. Most people pay $144.60 a month unless their income is low enough to qualify for help paying for it or their income is high enough that they pay extra for it. There is no maximum out of pocket limit for Parts A and B. The bills for Parts A and B are paid by Medicare.
Parts C and D involve private insurance. Part C is mostly referred to as Medicare Advantage here in northeast Ohio and is an alternative way to get Medicare benefits. It provides several different alternatives to traditional Medicare, each offered through many private insurance plans that Medicare regulates. This type of plan will include your services under Parts A and B, and usually prescription drug coverage as well. Instead of Medicare paying for your hospital and doctor bills, it pays the insurance company offering the Medicare Advantage plan a flat payment for each enrollee. Then the plan is responsible for managing and coordinating your care. There are many details to learn about these Medicare plans. For more information click here.
Part D is prescription drug coverage. It is offered by private insurers who contract with Medicare. Each prescription drug plan is slightly different, which is why you’ll want to shop carefully for your drug plan. Even if you don’t take any prescription drugs when you first go onto Medicare, you will still want to sign up for a Part D drug plan. Coverage under part D is very important because Medicare parts A & B do not cover prescriptions except those administered in the hospital. To go without drug coverage for a significant period of time would result in penalty charges when you eventually do need to enroll for Part D.
Medicare Supplement (Medigap)
See the table below for various benefits of the ten distinct Medicare supplement plans. One of these plans are usually chosen when a person elects to stay with Parts A & B of Medicare. These plans were standardized by Medicare so the benefits offered by each insurance company are the same. So you will want to ensure you are not overpaying for the same policy you can get elsewhere for less. Most importantly, you will want to check on the rate increase history over the last 8 – 10 years.
The chart below shows the two ways to have Medicare. If you choose Original Medicare, you sign up for Parts A and B and probably a Medicare supplement. Then you decide if you want prescription drug coverage under Part D. Although this shows drug coverage as optional it can be dangerous to go without drug coverage. I highly recommend that everyone choose to have some kind of prescription drug coverage starting from the outset of Medicare.
The second way to get Medicare is through a Medicare Advantage plan offered by a private insurance company. There are many companies in this area offering Medicare Advantage plans, so if you go this route, it will be important to shop for plans and find one that meets your needs. And again, drug coverage is shown as optional, but I would recommend that you choose a Medicare Advantage plan that offers prescription drug coverage.
If you get help through an insurance agent be sure to ask if the person is certified with Medicare Advantage plans as well as Medicare Supplement plans and that they represent several different companies. This way you are not being shown only one product when there may be others that better meet your needs.