Although some individuals are still covered by company and union health plans once they start Turning Age 65, fewer and fewer people have that opportunity. By far, Most US citizens discover that they have come under the Medicare umbrella. Whatever other insurance they may consider, it is all influenced by Medicare. Or, if your income level provides that alternative, Medicaid. (A few qualify for both.)
What do these choices mean?
Original Medicare Part-A provides hospitalization coverage for no charge. It doesn’t cover everything, but it does cover a lot. The key words for coverage are “medically necessary” procedures, i.e. those required to keep you alive and functioning. Once you get in to “elective” or “experimental” procedures, you are no longer covered. For example, it does not cover private rooms, private nurses, or even TV and phones in the room because they are not “medically necessary”. Basically, during each year it covers hospital stays for -
- days 1 - 60 after $1,068 deductible,
- days 61 - 90 at $267/day,
- days over 90 at $534/day, which are deducted from a 60-day pool of “lifetime reserve days”, and
- days beyond the pool of “lifetime reserve days” at full coverage.
- Charges for blood as well as home, hospice, of skilled nursing facility care are determined separately.
Original Medicare Part-B provides coverage for doctors, lab work and other medical services. There is a monthly charge for this coverage which amounts to $96.40 during 2010. The coverage is limited to the Medicare-approved amount for the Medicare-approved services. For example, a colonoscopy is limited to once every ten years, or two years for high-risk patients. Basically, after an annual deductible of $135, Part-B covers -
- 80% of doctors services and medical devices,
- 100% of clinical lab and home health services, and
- other “medically necessary” services after a co-pay or co-insurance deductible.
Original Medicare Supplement policies, Medigap fill in some of the gaps left by deductibles and co-pays. The coverage offered by these policies is strictly formulated by Medicare and specified by the letters A through N. (Plans E, H, I, and J are being phased out.) Until now, F has been the most popular. Although the coverage of each lettered plan is specific, the companies and charges vary by state.
Medicare Advantage, i.e. Part C plans, are privately run HMO alternatives to Original Medicare. Your care is generally restricted to the doctors and facilities that are members of that organization. Essentially, the government pays your Medicare allocation directly to these plans. The plans then set up their own internal rules for coverage as well as any additional charges that may apply. These plans vary on a state-by-state basis, and must be reviewed in that context.
Medicare Part-D Drug Plans, which also vary state-by-state, provide coverage for prescription drugs. Unless you have other drug insurance, you must sign up for one of these plans within four months of turning 65 to avoid being charged a late penalty.
Medicaid programs offer more extensive coverage to people with limited income and resources. This program is jointly funded by both federal and state governments, so it also varies state-by-state.
Go to the government’s Medicare Web Site for more information and for links to individual state programs.
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