The Basics
Medicare is the federal health insurance program for people
who are 65 or older, certain younger people with disabilities, and people with
End-Stage Renal Disease (permanent kidney failure requiring dialysis or a
transplant, sometimes called ESRD). If you or your spouse have worked full time
for 10 or more years over a lifetime, you are probably eligible to receive
Medicare Part A for free.
Part A covers inpatient hospital stays, care in a skilled
nursing facility, hospice care, and some home health care. What Medicare covers
is based upon, Federal and state laws, National coverage decisions made by
Medicare about whether something is covered, local coverage decisions made by
companies in each state that process claims for Medicare. These companies
decide whether something is medically necessary and should be covered in their
area.
Medicare Part B is available at a monthly rate set annually
by Congress ($121.80 in 2016 for incomes $85000.00 or less for an individual).
Part B covers certain doctors' services, outpatient care, medical supplies, and
preventive services. Some seniors are eligible to receive the medical insurance
portion (Part B) free as well, depending on their income and asset levels. For
more information, inquire about the Qualified Medicare Beneficiary (QMB),
Special Low Income Medicare Beneficiary (SLMB), and Qualifying Individual
programs through your county social services office. Remember, in most cases,
if you don't sign up for Part B when you are first eligible, you will have to
pay a late enrollment penalty for as long as you have Part B. Your monthly
premium for Part B may go up 10% for each full 12-month period that you could
have had Part B, but didn't sign up for it. Also, you may have to wait until
the General Enrollment Period (from January 1 to March 31) to enroll in Part B,
and coverage will start July 1 of that year. Usually, you don't pay a late
enrollment penalty if you meet certain conditions that allow you to sign up for
Part B during a Special Enrollment Period.
Medicare Part C (Medicare Advantage Plans) are a type of
Medicare health plan offered by a private insurance company that contracts with
Medicare to provide you with all your Part A and Part B benefits. Medicare
Advantage Plans include Health Maintenance Organizations (HMO's), Preferred
Provider Organizations (PPO's), Private Fee-for-Service Plans (PFFS's), Special
Needs Plans (SNP's), and Medicare Medical Savings Account Plans (MSA's). If
you're enrolled in a Medicare Advantage Plan, most Medicare services are
covered through the plan and are not paid for under Original Medicare. Most
Medicare Advantage Plans have prescription drug coverage included.
Medicare Part D (prescription drug coverage) adds
prescription drug coverage to Original Medicare, some Medicare Cost Plans, some
Medicare Private-Fee-for-Service Plans, and Medicare Medical Savings Account
Plans. These plans are offered by insurance companies and other private
companies approved by Medicare.
Medicare Advantage Plans may also offer prescription drug
coverage that follows the same rules as Medicare Prescription Drug Plans. Keep
in mind, you may owe a late enrollment penalty if you go without a Medicare Prescription
Drug Plan (Part D), or without a Medicare Advantage Plan (Part C) (like an HMO
or PPO) or other Medicare health plan that offers Medicare prescription drug
coverage, or without creditable prescription drug coverage for any continuous
period of 63 days or more after your Initial Enrollment Period is over.
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