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Medicare Coverage Options

Medicare Coverage Options

Original Medicare:

To better understand the plan benefits, let's take a very simplified look at Medicare coverage in general. The Medicare program began in 1965 offering Part A "hospital" benefits and Part B "medical" benefits to anyone age 65 or older or disabled for 2 years at any age.

Part A (See "Medicare and You" - pages 15, 23-25, 35-39)

  • Is generally premium free, based on the recipient's or recipients spouse's work history.
  • Under Part A, if you are hospitalized as an inpatient, you are responsible for the Medicare Part A deductible of $1,260 per stay (2015). After the initial deductible is covered by the patient, Medicare generally will pay 100% of your approved hospital room and board charges for the next 60 days. This would include special dietary meals required due to your condition.
  • Note: Staying overnight in a hospital doesn't always mean you're an inpatient. You're considered an inpatient the day a doctor formally admits you to a hospital with a doctor's order. Being an inpatient or an outpatient affects your out-of-pocket costs. Always ask if you're an inpatient or an outpatient.

Part B (See "Medicare & You" - pages 15, 23-27, 40-61)

  • For 2015, the Part B premium starts at $104.90 per month:
    • You will pay a higher premium if your income is higher than $85,000 for an individual and $170,000 for couples, increasing from there. See the Medicare Costs link below for the full income breakdown. 
  • Part B primarily covers physician services, outpatient care, home health services, and other medical services. Part B also covers some preventive services.
  • For Part B services you are responsible for an annual deductible of $147 (2015) then generally Medicare will pay 80% of approved charges and you are responsible for the remaining 20%.
  • You may also experience daily co-pays while in a skilled nursing facility (SNF) for rehabilitation or recovering from surgery or major trauma. For example, following hip replacement you may be transferred to a SNF for rehabilitative therapy. Medicare generally will pay for the first 20 days of this "skilled" care and you are responsible for $157.50 (2015) per day for days 21-100.
    • Note: For Medicare to cover this service you must be a hospital inpatient for three consecutive days prior to moving to the SNF and must be transferred for the same condition for which you were hospitalized.

Keep in mind that this is a very simplified look at Medicare Parts A & B coverage. As you can see, there are a few areas of exposure that you are responsible for, this is why most people who choose to stay with Original Medicare also enroll in a Medicare supplement. These are also known as "gap" plans; to cover some or all of these areas ("gaps") of exposure.

Enrollment Periods (See "Medicare & You" pg. 25)

  • Initial Coverage Enrollment Period/Initial Enrollment Period: begins three months before you turn 65, the month of your 65th birthday and three months after. You may enroll in a supplement and drug plan, or Medicare Advantage plan.
  • Annual Enrollment Period: Runs from October 15-December 7 of each year with changes taking effect on January 1 of the upcoming year. You may make as many changes to your drug plan or Medicare Advantage, with the last application received by Medicare as your final choice.
  • Special Election Period: Begins the first month of your qualifying event. A few examples are: qualifying for Medicaid, moving out of the service area, involuntarily losing drug coverage, qualifying for low income subsidy and an enrollment based on incorrect or misleading information.

--Medicare and You booklet
--2015 Medicare Costs Page

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