A Guide To Medicare Parts
Medicare Parts: What You Need To Know
What Is Medicare?
According to Medicare.gov, medicare is a federally funded health insurance program for people who are 65 or older, those with disabilities (who qualify), and people with lifelong, chronic major medical needs such as End-Stage Renal Disease (ESRD), which causes permanent kidney failure requiring regular dialysis or a transplant, which typically has a very long waiting list.
Medicare Parts Broken Down
Medicare comes in different parts: Part A, B, and D, that cover different healthcare services. Here is a simple breakdown:
- Medicare Part A – This covers more expensive, long-term, and specialized healthcare needs, such as hospital in-patient stays, the costs of nursing homes and hospice, and sometimes in-home care.
- Medicare Part B – This covers more routine care, such as doctors’ services, medical supplies, check ups, outpatient services, and preventative care.
- Medicare Part C – Medicare part C is a bit different, as it’s a Medicare Advantage plan. Medicare Part C is similar to a Medigap plan, but it includes a prescription drug plan and it usually comes at little or no cost (but it’s more limited in terms of doctors and coverage, and can be harder to qualify for).
- Medicare Part D – This covers prescription drugs, as well as shots and vaccinations.
While some people may be under the impression that Medicare is free for everyone who qualifies, this isn’t true. Medicare is usually less expensive than regular insurance, but there are still premiums to pay. The cost of premiums can vary wildly, and fluctuate from state to state and year to year. They can change due to a variety of factors, including the beneficiary’s health, where they live, whether the government or insurance providers have tinkered with price increases, as well as what services and medications they choose to cover, the amount they are willing to cover for these things, changes in income requirements, and of course what plans and coverage they choose to get. Medicare also still comes with deductibles, copays, out-of-pocket costs and (for some) the cost of coinsurance. After adding everything up, the average Medicare enrollee may find themselves reeling at the total sticker price. But the bill is still somewhat in the beneficiary’s control, as they can choose what plan they get and how much coverage they want. Premiums are also mainly income-based, so what you can reasonably afford is also taken into consideration by insurers and the federal government. So how do these premiums apply? They typically break down as follows:
- Part A – For most people, Part A is fully covered and doesn’t cost anything. However, if you don’t qualify for Part A, you may be able to buy it.
- Part B – Everyone is subject to a premium of some kind for Part B. While Medicare Part B is optional, you are likely to be enrolled automatically if you are auto-enrolled in Part A, but you have the option to drop it.
- Part C – Premiums for Part C are sold in the private marketplace, which means they vary by provider, plan, and location.
- Part D – Because Medicare Part D strictly covers prescription drugs only, it is sold by private insurance providers. This means the premiums will vary plan to plan. In order to qualify for Medicare Part D, you will also need to enroll in a Medicare-approved plan. That being said, all plans come with a standard amount of coverage set by Medicare.
To get an idea of what your Medicare expenses might be, the Centers for Medicare & Medicaid Services offers an Out-Of-Pocket Cost Calculator. While this isn’t a definitive guarantee of your actual cost, it can help you prepare for what you might be looking at paying.
What If I Can’t Afford Medicare?
As was stated earlier, the out-of-pocket costs (premiums, deductibles, copays, coinsurance costs, etc) can be staggering for the average Medicare recipient. If you find yourself struggling to afford the cost of your healthcare, you may qualify for federal and state subsidies. This often comes in the form of Medicaid.
Medicaid is a program provided by the federal government for those who qualify due to disability or low income. It covers some or all of the costs of Medicare. If you qualify for both Medicare and Medicaid, you are know as having “Dual Eligibility”.
As healthcare costs continue to rise, lawmakers and insurance companies are constantly working together to balance the cost of care for beneficiaries with keeping the Medicare Trust Fund from going into bankruptcy. It’s hard to know what the future holds for both beneficiaries and taxpayers who fund their care. Doctors are constantly having to tailor their services to provide Medicare recipients access to care while still fitting in to new rules, reforms, and costs of service. With all of these changes happening on a routine basis, it can be difficult for beneficiaries to navigate as well, and for them to find plans that best fit their medical needs while balancing affordability into the equation.
Oftentimes, recipients get hit with surprises in their bill and coverage when they need it the most, and are unable to change it. There are so many details and difficulties to enrolling, navigating the system, and keeping up with what plan will be right for you. Opportunities to save money may go amiss, and certain coverage needs may be overlooked. Don’t go it alone. Get a quote and talk to an insurance specialist today.