What is Medicare?

Medicare: the name is all over health information, the news, and even conversations between friends and family. Millions of people use the program, and hundreds of millions at the very least are familiar with the name.

But what is Medicare, exactly? How does it differ from other insurance programs? Is it a form of public aid? What is the difference between Medicare and Medicaid and other insurance programs?

Questions like these must be answered before you can even begin to think about making big decisions. For instance, you cannot answer questions like, “what is the best Medicare Advantage plan in Georgia?” if you aren’t sure what Medicare Part A and Part B cover normally.

Getting oriented to Medicare is, therefore, extremely important. It helps you avoid making incorrect assumptions or being led to the wrong conclusion regarding your healthcare insurance choices.

Let’s start with the biggest question, then: what is Medicare?

Medicare is a publicly funded national health insurance program run in large part by the United States federal government. The Medicare program provides insurance primarily for adults 65 and older. Like social security, Original Medicare coverage is intended to activate automatically when an individual reaches retirement age.

Certain individuals with disabilities or end-stage kidney failure can also qualify for Medicare.

Main Coverage: Medicare Part A and Part B

Medicare coverage is split up into multiple parts. Medicare Part A and Medicare Part B serve as the main insurance plans, and they are the only components that are provided wholly by the federal government. For this reason, they are often referred to as “Original Medicare” by some providers and in some literature.

Medicare Part A — Hospital Coverage

Medicare Part A provides insurance coverage for inpatient care during hospital stays. It also provides coverage for skilled nursing facility care, hospice care, and certain forms of home health care.

Note that this coverage only includes the costs of your hospital or skilled nursing facility stay itself, such as the cost of your semi-private room. It does not cover actual procedures, tests, surgery, or treatment from your physician. Costs like these will be mostly covered by Part B.

Medicare Part B — Medical Coverage

Medicare Part B provides coverage for medically necessary appointments, services, procedures, tests, screening, and supplies. It can also provide coverage for ambulance rides, durable medical equipment, mental health services, clinical research, preventive health care services, and second opinions prior to receiving surgery. Certain drugs prescribed to you as an outpatient will be covered, but for the most part, drugs must be covered by Medicare Part D.

Medicare Part C & Part D

The remaining two components of a Medicare plan — Part C & Part D — act as supplemental coverage to what Part A and B provide. Part C & Part D plans are provided through private insurance carriers.

Medicare Part C

Medicare Part C is the collective way to refer to a large number of available Medicare Advantage supplemental plans. These plans are private insurance plans with much of the same coverage policies guaranteed under Medicare Part A and Part B. In fact, some Medicare Advantage plans replace components of Part A, Part B, and may include Part D.

Medicare Part D — Prescription Drugs

Medicare Part D provides coverage for prescription drugs. Certain prescriptions are covered according to a “drug formulary,” which is listed as part of your plan information. Review your drug formulary carefully to ensure your needed medications are covered.

Medicare Supplements — “Medigap” Plans

Private health insurers provide a number of optional supplemental plans to add to existing medicare coverage. These plans can close coverage gaps in certain plans, or they can lower your deductible and/or coinsurance obligation, depending on the plan type and it’s specific policy details.

Visit our “Medicare Supplements” page for more specific information on Medigap plans and what they typically cover.

How to Enroll in Medicare

For most people, enrollment in Medicare Part A and Part B are automatic as part of the process of registering for Social Security benefits upon retirement age.

Look at our “New to Medicare” article for more information on how to register for Medicare and receive your red, white, and blue Medicare card.

You can also lookup how to enroll in Medicare in our “Apply for Medicare” article.

Medicare Premium Costs

Medicare Part A

Medicare Part A coverage is provided at no cost to individuals who have worked at a job where income was withheld to pay Medicare taxes for at least 40 calendar quarters, or 10 years.

Individuals who did not work long enough to provide the minimum contribution will have their monthly premium set according to a number of factors. The maximum monthly premium is currently $437 as of 2019.

Medicare Part B, Part C, and Part D

Costs for these plans vary according to your selected coverage, your health history, the amount you’ve paid into Medicare through taxes while working when you enroll in your plan, your income, and a number of other factors.

See the respective “Parts of Medicare” page for your Part for more specific information on costs and estimates for premiums or our “Medicare Costs” page for a general overview of the costs for each Part.

What Is the Deductible for Medicare?

Medicare plans include a deductible and a coinsurance cost.

Medicare Part A Deductible and Coinsurance

$1,364 deductible each benefit period
$0 in coinsurance for up to 60 days each benefit period
$341 coinsurance per day for over 60 days up to 90 days
$682 coinsurance per day for stays over 90 days within a benefit period; referred to as “lifetime reserve days,” which you have up to 60 of
You pay all costs for stays past 90 days once you run out of “lifetime reserve days” until the next benefit period

Medicare Part B Deductible and Coinsurance

$185 deductible per year
Coinsurance is 20% of the Medicare-approved billing amount for most doctor’s services, outpatient care, durable medical equipment, etc.

Medicare Part C & Part D Deductibles and Coinsurance

These vary according to the plan selected, it’s coverage, income, and other details
Visit our Medicare Part C or Medicare Part D pages for more specific information and estimates

Other Resources and Information on Medicare

If you have any specific questions about enrolling, coverage, costs, or what plans to select, do not hesitate to contact us online or give us a call at (678) 807-8414. We’re here to help Protect What’s Ahead!