Health Insurance: Medicare

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KEY POINTS

• Medicare is a federal government program. It provides healthcare coverage for people 65 and older. It also provides coverage for people of any age who have certain disabilities or end stage kidney disease.
• A Medicare supplement (Medigap) insurance, sold by private health insurance companies, can help pay some of the health care costs that Medicare doesn’t cover, like copayments, coinsurance, and deductibles.
• Medicare will pay for some of your skilled nursing care or therapy costs for up to 100 days after you have been in the hospital. Long-term care insurance can help cover costs if you need to be in a skilled nursing facility, hospice care, or have some types of home health care for a longer time.
• Medicaid provides medical insurance for people with low incomes or limited assets. The states set the rules about what is covered. You can have both Medicare and Medicaid.

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What is Medicare?

Medicare is a federal government program. It provides healthcare coverage for people 65 and older. It also provides coverage for people of any age who have certain disabilities or end stage kidney disease.

Medicare Part A and Part B pay some of the costs for needed medical services. Both parts pay toward home healthcare if certain conditions are met.

People who get Social Security or Railroad Retirement benefits when they turn 65 are automatically enrolled in Medicare Part A. If you will not get Social Security at age 65, you need to apply for Medicare 3 months before you turn 65.

Part A

Medicare Part A covers:

• Inpatient hospital care
• Skilled nursing facilities
• Home healthcare
• Hospice care

Part B

Medicare Part B is optional. If you want Part B, you must pay a monthly premium. You must also pay a certain amount of money out of pocket each year for health care services, called a deductible. After the deductible is met, Medicare B will pay 80% of Medicare-approved charges for covered services. You are responsible for copayment of the other 20%. Medicare Part B covers:

• Doctor visits
• Lab and X-ray services
• Durable medical equipment, such as wheelchairs, hospital beds, and oxygen tanks
• Ambulance services
• Outpatient hospital care

Medicare does not cover all types of medical services and equipment. Some examples of healthcare not covered by Medicare are:

• Most types of nursing facility care unless you are receiving skilled care, such as IV medicines or some types of wound care
• Most types of dental care
• Most prescription medicines taken outside a hospital

Part C

Medicare Part C, also called a Medicare Advantage Plan, is a type of health plan offered by a private health insurance company that contracts with Medicare to provide you with all your Part A and Part B benefits. If you're enrolled in a Medicare Advantage Plan, covered healthcare services, such as doctor visits and prescriptions, are paid through the plan instead of Medicare.

Part D

You can get Medicare Part D to help cover prescription medicines. These plans are offered by insurance companies and other private companies approved by Medicare.

What is a Medigap policy?

A Medicare supplement (Medigap) insurance, sold by private health insurance companies, can help pay some of the health care costs that Medicare Part A and B don't cover, like copayments, coinsurance, and deductibles. There are many Medigap plans. The plans differ in cost. They also differ in how much they pay toward medical costs and under what conditions. In general, the more a Medigap plan agrees to pay, the more it costs. You must weigh the risk of paying medical costs yourself against paying for Medigap insurance.

What is long-term care insurance?

Medicare will pay for some of your costs for up to 100 days in a skilled nursing facility, hospice care, or some types of home health care. Medicare pays only after you have been in the hospital for 3 or more days, and only if you need skilled nursing care or therapy. If you need help with bathing, dressing, and eating for more than 100 days, you pay 100% of the costs unless you have long-term care insurance.

Most long-term care insurance policies limit what they cover. For example, some will not cover:

• Care given in your home
• More than a certain number of years or certain dollar amount of long-term care
• People with certain illnesses, such as Alzheimer's disease

Before you buy long-term care insurance, find out what is and is not covered. You also need to think about whether you can pay the insurance premiums now and in the future.

You can buy long-term care insurance before or after age 65. The younger you are when you buy long-term care insurance, the lower the payments are. Some long-term-care policies are not sold to people over a certain age (for example, age 75).

What is Medicaid?

Medicaid provides medical insurance for people with low incomes or limited assets. Federal and state governments pay for it. The states set the rules about what is covered.

It costs a lot to live in a nursing facility. You may not be able to afford nursing facility care for very long. When you have spent all of your money, you can apply for Medicaid. You can have both Medicare and Medicaid.

Medicaid rules change from time to time and the rules can be different from state to state. Check with your state social services agency for more information.

Where can I get more information?

Rules about what Medicare covers can be confusing. The rules can also change. The monthly payment for Medicare Part B can change every January. The deductible and your copayments may also change.

For more information, you might want to talk with:

• Your healthcare provider
• A lawyer
• A social worker at a hospital or nursing facility
• A private care manager
• Other people who have Medicare

The following agencies can help you understand health insurance and your options:

• Social Security or US Department of Health and Human Services for Medicare information

  There may be a local Social Security office you can visit. The national Social Security phone number is 800-772-1213. The Web site is http://www.ssa.gov.

  The Medicare phone number is 800-633-4227. The Web site is https://www.medicare.gov.

  Through these agencies you can:

  • Request copies of the free Medicare booklet (updated every year).
  • Get information about applying for Medicare.
  • Find out how to get a Medicare card.
  • Ask other Medicare questions.
• State insurance department or state insurance counseling center for information about Medigap and long-term-care insurance
• Local area agency on aging for general information on Medicare. It may also have general information on other types of health insurance. Call 800-677-1116 to find an agency near you.
• The social services or patient services department at a local hospital
• Senior citizen centers, which may bring in expert speakers or have information booklets. They may be able to put you in touch with other people who are facing the same decisions.
• American Association of Retired Persons (AARP), which publishes many booklets about health insurance. You do not have to be a member to ask for free booklets. Call 800-424-3410.
• National Council on Aging, which sells booklets about Medicare, Medigap, and long-term-care insurance. Information is also available on their Web site (https://www.ncoa.org). The phone number is 800-373-4906.

If you get health insurance through your employer, check with your employer about what is covered by your employer's plan.