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Medicare 101

Medicare 101

What is Medicare?

Medicare Part A, Medicare Part B, and then there is Part C and medicare supplement plans. It all sounds very confusing. What is medicare? What does it cover and how do I apply for medicare? Designed primarily to provide health insurance to U.S. residents age 65 or older, Medicare is managed by the federal government, and partially funded through payroll deductions. Nearly every citizen, as of his or her 65th birthday, can be enrolled in Medicare, with some of its benefits provided at no cost.  Persons under 65 who receive Social Security due to disabilities are also eligible for Medicare.

Medicare is divided into four parts:

  • Medicare Part A (Hospital Insurance) pays a designated number of hospitalization days each year,  a designated number of days in a skilled nursing facility, some hospice care, and some home health care. As example,  in 2017 for the first 20 days in a skilled nursing facility Part A pays all of the cost, for days 21 through 100 pays all but $164.50 each day, and pays nothing for any day after that.  Medicare Part A is an entitlement in the U.S. Those who have had Medicare taxes deducted from their paychecks for at least 30 quarters pay nothing for Part A.
  • Medicare Part B (Medical Insurance) an optional program, covers a portion of preventative and curative services, such as doctor visits, lab tests, blood work, ambulance, and surgeries, as well as medical equipment such as walkers, and wheelchairs that Part A doesn’t cover. For Medicare Part B, the standard monthly premium for 2017 is $134 for those with annual income under $85,000.  Higher earners pay more each month.
  • Medicare Advantage Plans (Part C) A Medicare Advantage plan is a health insurance plan and has a contract with the Federal government. These health insurance options include HMO’s PPO’s and PFFS plans are approved by Centers for Medicare and Medicaid and are run by private insurers. Keep in mind that Part C plans are not medicare supplemental insurance plans.  However they do offer a wide variety of additional insurance coverage beyond Original Medicare Part A & B.  Unlike original medicare, Part C coverage is sold by private insurance carriers such as Blue Cross / Blue Shield, Humana, Cigna, and many others.  Medicare advantage plans serve to reduce further the out-of-pocket costs of medical care while adding benefits beyond Medicare Part A and/or Medicare B coverage.  Perhaps the biggest differentiator is the geographical coverage area for reach.  Where original medicare and medicare supplement plans provide coverage throughout the U.S., and sometimes outside the U.S. as well, Medicare Advantage Plans, with the exception of emergencies, limit their coverage areas, generally to within the insured’s state. This difference could be crucial to a snowbird, who spends her summers in Minnesota but her winters in Arizona, for example.

Let’s look more closely at the two choices:

  1.  Medicare Supplement Plans give seniors a huge number of coverage options, allowing the insured to choose, how much or little they wish to pay in out-of-pocket costs for co-pays and deductibles, and whether or not they want to have emergency medical care coverage when traveling outside the United States, There are ten different Medicare Supplement plans that allow the insured to decide if he would like help paying, for example,  his medicare Part B co-insurance costs, his hospice care copayment, and / or his Part A deductible. The ten choices are Parts A, B, C, F, G, K, L, M, and N.
  2.  Medicare Advantage Plans, unlike Medicare Supplement Plans, package the coverage of Parts A and B, and the elected coverage of Part C under one insurance coverage roof, with the insurance carrier providing the benefits of, and collecting the premiums for, all Medicare parts. The federal government then reimburses the carrier for the Part A and B portion of the costs.  MA’s are primarily, though not exclusively, HMOs (Health Maintenance Organizations) or PPOs (Preferred Provider Organizations.)  Each insurance carrier offers a variety of MA plans, with geographic variations. Not all carriers offer all plans in all states.
  • Part D, also optional, provides dental coverage for those whose Part C plans do not include this, or for those who have chosen not to take part in Part C but wish some dental coverage.

When Can I Sign Up For A Medicare Plan?

Certain medicare plans have specific enrollment periods. After the senior’s initial enrollment in Medicare, any changes in Medicare advantage coverages are allowed only during specific times each year. Initial enrollment is allowed three months prior to the month the senior turns 65 through the end of the third month after his or her birthday month.  However if you want to switch to another plan, he or she can do so during the Annual Enrollment Period (AEP) each year. This runs  October 15th through December 7th each year.

Medicare Supplement Plans Give Greater Flexibility

Whereas medicare advantage plans have a specified enrollment period, medicare supplement plans can be purchased, or switch plans or coverages throughout the year. Certain states like California allow an insured to change to like medicare supplement plans without any medical underwriting on your birthday.

To find out about Medicare Part A, Medicare Part B or Medicare Supplement plan options available to you, please click here in addition you can speak with a licensed agent by calling  866-936-3831. Gary W Blackmon is licensed medicare insurance agent and helps customers from California to New York with their medicare options. If you have any questions, need assistance in  enrolling, or would like to obtain a quote specific to you, please contact me.

Medicare Part A

Medicare Part B

Medicare Advantage

Medicare supplement plans

Medicare Supplement

Source:

medicare.gov

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