In trying to understand what Medicare is and is not, sometimes the different parts begin to look like a very confusing bowl of Alphabet Soup. A, B, C, D? Why so many parts, what do they do for me and what do I need?
First of all, let’s understand what Medicare is.
Medicare is health insurance for U. S. Citizens or permanent legal residents, 65 and older who have worked long enough to be eligible for Social Security benefits (about 10 years in the workforce). At least it is right now. The whole fiscal cliff debacle has put on the table the possibility of increasing the qualifying age to 67. On that we will have to wait and see!
Some, under the age of 65, can qualify if they have certain disabilities. Anybody with End Stage Renal Disease can qualify for Medicare benefits.
But once qualified, here is the breakdown of the different parts of Medicare and what they are intended to cover.
Medicare Part A: This is your hospital insurance and covers INPATIENT care. This means that it will pay hospital costs (less any deductibles you have to meet) if you are admitted to the facility. BE AWARE: THIS DOES NOT COVER EXPENSES OF A HOSPITAL STAY IF YOU ARE NOT FORMALLY ADMITTED! Many hospitals are using ‘observation’ and ‘accommodation’ designations rather than admitting a patient to the facility which diverts all expenses to Part B of your Medicare coverage. This can be a costly thing not to understand!
Medicare Part B: This is your medical insurance. This covers doctor and other health care provider services, hospital outpatient services (those ‘observation’/’accommodation’ stays!), durable medical equipment and skilled home health care services. This will cover many preventive services as well. BE AWARE: Per CMS, “The copayment for a single outpatient hospital service can’t be more than the inpatient hospital deductible. HOWEVER, your total copayment for all outpatient services may be more than the inpatient hospital deductible.” This is the tricky part if you are in the hospital for several days without a formal admission!
Medicare Part C: These are other Medicare approved health plan options offered by private insurance companies. These Medicare Advantage Plans cover services that are covered under Medicare Part A, B and D. These plans are obligated to cover at a minimum what Medicare covers but may offer extra benefits at additional costs. These plans are not for everyone so be sure to talk with a Medicare expert who can help guide you in the selection process!
Medicare Part D: This is your Medicare Prescription Drug Coverage. This helps to cover the cost of prescription drugs and may help a Medicare recipient to lower those costs. These plans are run by other Medicare approved insurance companies. Part D plans are not one-size-fits-all and should be selected carefully with the help of someone who knows the different plans. This is a part of your policy that should be reviewed yearly to optimize your savings.
Each letter in this alphabet soup needs to be carefully considered from all angles. It needs to be discussed in conjunction with consideration of Supplemental or Medigap insurance policies. You need to understand what each type of insurance can and cannot do for you and the potential ramifications of each option selected.
Don’t let somebody choose for you. Get involved in knowing what you need to understand to allow you to make an informed decision.
On the journey with you…….Kathy
Kathy Eynon is an Eldercare Coach and Consultant that works with those struggling to cope with the demands of caring for an aging parent. She can be reached by email at: Kathy@ParentCareAlliance.com.