Medicare is a federal health insurance program that provides coverage for individuals 65 years of age or older. It also applies to younger individuals who have disabilities and those with permanent kidney failure. Most people on Medicare receive Social Security Disability Insurance (SSDI).
What does Medicare cover?
There are four parts to Medicare: A, B, C, and D. Parts A and B are generally administered by the government unless you choose a Medicare Advantage Plan. The original Medicare covers most health care services and supplies. There are required deductibles and the services must be medically necessary. There are some programs that help alleviate some out-of-pocket costs, like Medicaid, Medigap, or some other coverage.
With the original Medicare, seeing any doctor or hospital in the United States that takes Medicare is allowed. Participants can also have a stand-alone drug plan under Medicare Part D. Original Medicare can also work with other health insurance coverage to offset costs. Here’s a quick breakdown:
- Part A
Inpatient hospitalization, hospice, skilled nursing facilities, home health care, surgery, lab tests, and X-rays.
- Part B
General medical services, specialists, durable medical equipment, home health care, and preventative services.
- Part C
This is a plan using private health insurance that covers everything under Parts A and B and other benefits that may include routine vision, dental, and hearing.
- Part D
This is the prescription drug benefit program.
Medicare Advantage Plans
A Medicare Advantage plan works a lot like an HMO or PPO. This puts Parts A, B, and D together under one umbrella. That means care for emergency services, hospitalization, home health care, a nursing facility, hospice, outpatient care, medical equipment, general health care, and preventive services, and your prescription drugs are all covered. Under this type of plan, there may be additional benefits and incentives that aren’t offered with the original Medicare model, like dental, hearing, and vision.
There are different plans and rules for each one, and the cost of the premiums may vary depending on that plan. There are a few requirements:
- You can only use in-network physicians unless you have a PPO plan that allows for your own choice.
- There may be an additional premium required in addition to the Part B premium.
- You cannot use separate supplemental coverage.
What if I have insurance with my job?
If you are under an employer-sponsored insurance plan and have Medicare, the costs will be split. One of those plans will pay first (primary payer), and the other will be the secondary payer. It varies who pays first depending on the type of insurance, if there are any special situations, and if you are still working. To fully understand who pays first and why it’s best to speak to a representative who can provide a full breakdown of how this will work in your situation.
Take the time to figure out your needs to determine if you should use the original Medicare or get under a Medicare Advantage Plan.