Understanding Your Medicare Options

From Part A to Part D

With so many Medicare parts and plans out there, it is difficult to know which one is right for you

and your health. Here, we will distinguish between the different

options for those with Medicare eligibility and answer questions

about the different plans available.

Medicare Eligibility for Benefits Medicare is a federally funded health insurance program signed

into law in 1965. The program provides coverage for Americans aged 65 and older, and those under 65 who meet special criteria, such as qualifying for Social Security Disability Insurance (SSDI), receiving treatment for end-stage renal disease, or having ALS/Lou Gehrig’s disease.

Most people who are Medicare eligible use Part A and Part B and may choose to supplement it with Part D (prescription drug coverage) or Medigap, or use a Medicare Advantage (Part C) plan instead.

Many people with Medicare eligibility use both parts and may choose to supplement with Part D. Medicare Advantage plans, known as Part C, provide coverage options that can include Parts A, B and D.

Medicare Part A Medicare Part A is hospital

insurance that helps cover inpatient hospital stays at least overnight.

If you or your spouse paid Medicare taxes while employed, you are eligible for premium-free Part A benefits, including semi-private rooms, doctor’s fees, food, tests, long-term care hospitals, inpatient rehabilitation facilities, home health care, inpatient mental health care, and hospice care.

Part A coverage also includes medical services such as anesthesia, chemotherapy, nursing care, social services, physical therapy, occupational therapy, speech-language therapy, most drugs administered in the hospital, blood transfusions, obesity bariatric surgery, inpatient alcohol or substance abuse treatment, clinical trials, kidney dialysis, transportation, medical supplies, equipment use, and other diagnostic and therapeutic items and services.

Medicare Part A Nursing Care Part A also covers brief stays in skilled nursing facilities or

nursing homes, if the following criteria are met:

1. A preceding hospital stay of at least three days, not counting the discharge date.

2. The nursing home stay must be for care of a medical issue that was the cause of the hospital stay, or something diagnosed while in the hospital.

3. The patient must have an ailment that requires skilled nursing supervision.

4. The care in the nursing home must be skilled. Medicare Part A will cover a maximum length of

stay of 100 days per ailment in a skilled nursing facility. While the first 20 days are paid for in full, the remaining 80 days require a co-pay of $137.50 per day, as of 2010.

Medicare Part B Medicare Part B is optional

medical insurance that requires a monthly premium (based on income) and has an annual deductible. After meeting the deductible, Medicare Part B will pay 80% of the approved charges.

There is no penalty if you chose not to enroll in Part B because you already had coverage through your employer; you will be offered a special enrollment period in that event.

Part B generally covers things Part A doesn’t cover, including outpatient procedures such as diagnostic tests, physician or nursing care, x-rays, lab tests, kidney dialysis, flu and pneumonia vaccinations, blood transfusions, home health aids, certain hormonal treatments, pain relief drugs, immunosuppressive drugs for organ transplant recipients, counseling services, oxygen, and medical equipment such as walkers and wheelchairs.

Medigap Medigap policies (supplemental insurance

to Medicare) are standardized by the Centers for Medicare & Medicaid Services (CMS) and state governments. They are sold by private companies to fill in the “gaps” in traditional Medicare coverage.

An example of a gap would be the 20% co-insurance due on a Part B claim for a medical visit.

You can obtain Medigap if you're 65 and have Medicare Part B. There are some special enrollment periods, but if you don't enroll at a time when you are guaranteed to be accepted, the company can refuse your claim. However, some states allow individuals who are 65 & under (with disabilities) to receive Medigap.

Part C – Medicare Advantage Medicare Part C, also known as

Medicare Advantage, is another form of Medicare benefits offered by private companies. Part C combines Parts A and B, allowing individuals to get medical and hospital insurance from one company. Medicare Advantage plans often provide Medicare Part D coverage as well.

While traditional Medicare Parts A and B are not expensive, their coverage can be limited, so many people turn to supplemental insurance (Medigap) and Part D, which cost extra.

The alternative, Part C, includes Parts A and B and may include extras such as prescription drugs, vision and hearing screening and dental care.

Medicare Advantage plans cover everything offered by traditional Part A and B plans and more. Sometimes these plans are a lower cost alternative to traditional Medicare benefits, while offering extras.

Part C Qualification Restrictions Unlike Medigap, Part C/Medicare Advantage plans are required

to accept nearly everyone with Medicare eligibility because a past medical history can’t be a barrier to enrollment. Some people with certain disabilities or end-stage renal disease may not qualify for Part C. Those who qualify for Social Security Disability Insurance (SSDI) may find that Medicare Advantage plans offer a better choice and more coverage.

Most SSDI recipients are unaware of the fact that if you are under 65 and only have Medicare eligibility based on your disability, any pre-existing conditions you have may prevent you from obtaining supplemental insurance (Medigap) to cover the gaps in traditional Medicare coverage. For this reason, Part C may be a better choice.

Part D – Prescription Drug Coverage Certain drugs, like those that

must be administered in a doctor’s office, are instead covered under Medicare benefits Part B. Anyone entitled to Medicare Part A, or enrolled in Part B is also eligible for Part D (prescription drug coverage).

Part D Medicare benefits involve purchasing either a stand-alone Prescription Drug Plan (PDP) for prescription coverage only or a Medicare Advantage plan that combines medical and prescription drug coverage (MA-PD).

Part D plans cover all therapeutic classes CMS deems necessary and can cover no less than two drugs per class; CMS regulates plans to prohibit from limiting coverage. Also, CMS requires plans have cost-saving methods to lower the cost of prescription drug coverage.

The Right Benefits for You Medicare Part A covers any drugs and medical services needed

during an inpatient stay; Part B makes payments to physicians for medical services and drugs provided during outpatient visits; and Part C combines these two benefits under one umbrella. Part D provides only prescription drugs, offering almost all other types of medications except over-the-counter drugs, barbiturates, benzodiazepines, cough and cold medicines, prescription vitamins and minerals, drugs for cosmetic purposes or hair growth, and drugs for weight loss or weight gain.

Finding the right Medicare benefits package can be confusing, but you should examine all your options to find the plan that works best for you. Speak with a Medicare advisor today to help you review your Medicare plan options.