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FREQUENTLY ASKED QUESTIONS
Original Medicare (Part A & B)
Medicare is our Federal Insurance Program designed for people 65 years or older, certain people with disabilities, and those with permanent kidney failure treated with dialysis or a transplant. Also known as Original Medicare, there are 2 Parts to Medicare – Part A (hospital insurance), and Part B (medical insurance). A patient can schedule and see any doctor or hospital in the country that takes Medicare.
Medicare Part A provides inpatient/hospital coverage for those who have been admitted to a hospital by their doctor. Some in-patient skilled nursing facility care, some home health care, and hospice care are also covered under Part A. There is no monthly premium for Part A coverage for those who have 40 or more quarters of Social Security credits (10 years of work), and who are eligible to receive Social Security or Railroad Retirement benefits. A co-insurance may apply after a 60-day benefit period has been reached.
Medicare Part B provides outpatient/medical coverage for services such as doctor’s visits, outpatient hospital care received, physical & speech therapy, laboratory testing fees, ambulance services, some medical equipment/supplies and some home health care. There is a monthly premium individuals must pay for Part B coverage that is based on their modified adjusted gross income (MAGI).
If you (or your spouse) are still working and have coverage through a group health plan through your work, you may not need Part B of Medicare right away. Part B coverage is optional, and can be delayed until you (or your spouse) are retired and coverage is needed. It is highly recommended that you contact your benefits administrator though to find out how your employment coverage works with Medicare before declining Part B. Once employment or coverage through your work ends, you have 8 months to sign up for Part B without a penalty.
A U.S. citizen or permanent resident who has lived here at least 5 years can enroll in Medicare 3 months before or after they turn 65. One can also enroll if they’ve been receiving Social Security disability benefits for at least 24 months, or if they have end-stage renal disease or ALS (Lou Gehrig’s Disease).
Those receiving Social Security, Railroad Retirement, or disability benefits, will be automatically enrolled in Medicare Part A & B, and sent an Initial Enrollment Package with Medicare Card 3 months prior to a 65th birthday or 24th month of disability. Others will need to file an application through the Social Security Administration.
Medicaid is a separate health insurance program administered by the government that is intended to help people with low incomes and very limited resources. There are income and resources requirements one must meet in order to qualify for Medicaid. Medicaid offers coverage similar to Original Medicare (Part A and B), but it also includes prescription drug coverage. One can be dually-eligible for both Medicare and Medicaid and obtain each.
A veteran may be eligible for Veterans Affairs (VA) benefits. VA benefits are administered by the federal government and include health care, among other benefits. Medicare and VA benefits do not work together, though one can be enrolled in both. Medicare will not pay for any care received at a VA facility.
Medicare Advantage (Part C)
Medicare Advantage (Part C) are private health plans that contract with the federal government to provide the same Medicare benefits included with Original Medicare (Part A & B); however, different costs, rules, and restrictions may apply, and added benefits may be offered above what Original Medicare provides, such as: gym memberships, prescription drug coverage, health and wellness services, and transportation for doctor’s visits.
There are 5 different plan types under the Medicare Part C umbrella: Preferred Provider Organization Plans (PPO), Health Maintenance Organization Plans (HMO), Medicare Medical Savings Account Plans (MSA), Private Fee for Service Plans (PFFS), and Special Needs Plans (SNP).
Preferred Provider Organization (PPO) Plans offer a network of doctors, specialists, hospitals, and health care providers that you can choose to receive care from. Out-of-pocket costs are minimal if you stay in network. You can seek medical care outside of the network and still be covered, though not fully, so there may be some additional costs. Medically necessary emergency and urgent care are always covered though. Most PPO plans come with prescription drug coverage, but some don’t, so make sure you compare the plans. Some of the extra benefits that may be offered include: dental, vision, and hearing coverage, gym membership, transportation services, and even meal delivery.
HMO plans are generally more limited than Original Medicare. They don’t allow HMO members to see providers outside of their network, and if one does, they would be responsible for the full cost. The exception to this is in the case of emergent care or out-of-area urgent care. HMO plans are required to offer the same benefits as Original Medicare, with the option to include prescription drug coverage benefits. Extra benefits, such as: dental, hearing, and vision coverage, meal delivery, and transportation to and from medical appointments may also be found in these plans.
These plans combine a high-deductible insurance plan with a medical savings account Medicare funds that can be used to pay for health related expenses. You cannot fund your own Medical Savings Account. Once the Medical Savings Account runs out of money, you would be required to pay any expenses out-of-pocket until your deductible is reached. The funds used from the Medical Savings Account for Medicare Eligible expenses also count towards the plan’s deductible, and any funds still in the account at the end of the year will stay in the account to be used towards future expenses.
PFFS plans identify a set rate for all services you could receive. You are allowed to see any Medicare-approved provider, but some providers may not accept the terms of the plan. A list of in-network providers who have agreed to treat members of the plan is generally available. All PFFS plans must also cover out-of-network care received, though you may pay a higher cost. PFFS plans are not available in every state, so reach out with any questions about your particular state.
Special Needs Plans are designed for people who suffer from a severe, chronic, or disabling condition. These plans cover the same benefits as Original Medicare, and many have additional benefits included to cover extra services that members often need. You may qualify due to a specific disease, unique health care needs, or limited income.
You don’t need to sign up for Medicare each year. However, each year it is recommended you review your coverage, and make any changes you need. Those who are currently on a Medicare Advantage Plan or Part D prescription drug plan can make any changes during the Annual Enrollment Period (Oct. 15 – Dec. 7). One can also qualify for a special election period to make changes outside of the Annual Enrollment Period in certain situations. Reach out to our team to discuss.
Medicare Part D
Original Medicare does not cover the cost of prescription drugs. Medicare Part D is the insurance plan that covers the cost of outpatient prescription drugs.
The specific list of drugs covered under a Part D plan is known as a “formulary.” Many plans will place the drugs they cover into different “tiers” based on their formularies, with the lowest tier usually having the lowest costing drugs.
Also known as Medigap, Medicare Supplements are insurance policies that help you pay the out-of-pocket costs (coinsurance & copayments) of Medicare. Some will also help cover emergency care that may be needed when traveling outside the U.S. (which Medicare won’t do).
There are 10 different Medicare Supplement plans available in 47 states — Plan A, B, C, D, F, G, K, L, M, and N. Each plan provides a specific level of coverage for these costs: Part A coinsurance, deductible, hospital expenses, and hospice care coinsurance/copayment, and Part B coinsurance, copayment, deductible, and excess charges. Plans can also provide a specific level of coverage for foreign travel emergency care, skilled nursing care facility coinsurance, and blood for transfusions. Those who live in Massachusetts, Minnesota, or Wisconsin have options that are a bit different, so feel free to reach out to us to discuss if you are from one of these 3 states.
Original Medicare does not cover foreign travel, except under few exceptions – please reach out to our team to discuss these. We recommend that frequent travelers (outside of the states), look for a supplemental plan that will help to offset this gap in coverage.
Coverage is guaranteed issue, regardless of health status, if you enroll during the 6 month, Open Enrollment Period that starts the first month you are 65 and enrolled in Part B. One can still apply for a plan outside of open enrollment periods; just be aware that in most states, the carrier will use medical underwriting to determine whether to accept your application, and how much to charge.
Dental, Vision, and Hearing
Original Medicare does not include dental, vision, or hearing benefits, so generally there will be out-of-pocket costs for any dentures, hearing aids, or any eye wear needs. Fortunately, Medicare recipients can purchase a Dental, Vision, or Hearing (DVH) insurance plan to help offset these costs. Or, for those who are considering a Medicare Advantage plan (Part C), they may want to consider a plan that includes dental, vision, and hearing coverage.
Cancer plans are insurance policies that supplement your current health plan to offset the typically high costs associated with a cancer diagnosis. Benefits generally include hospital stays, surgery, radiation, chemotherapy, and other types of cancer treatment, though they can vary by plan.
2023 MEDICARE COSTS
- People who have worked and paid Medicare taxes for 10 years (40 quarters), don’t have to pay a monthly premium for Medicare Part A.
- If you paid Medicare taxes for 30-39 quarters, your Part A monthly premium will be $278 in 2023.
- If you paid Medicare taxes fewer than 30 quarters, your Part A monthly premium will be $506 in 2023.
- You will pay $1600 deductible for each benefit period.
- $0 coinsurance for days 1-60 in each benefit period.
- $400 daily coinsurance for days 61-90.
- $800 daily coinsurance for days 91 and beyond (Lifetime Reserve Days)
- All costs beyond Lifetime Reserve Days
- The standard monthly premium for Part B coverage in 2023 is $164.90.
- This premium could be higher, depending on your income.
- The Part B yearly deductible is $226 in 2023.
- Once the deductible has been met, you would be responsible for paying 20% of the Medicare-approved amount for the care you received.
- Part C monthly premiums will vary by plan.
- Most Part C plans will have little or no monthly premium.
- You would be responsible for your Part A and Part B costs as well.
- Part D monthly premiums will vary by plan.
- The average monthly premium is currently $31.50.
- Part D plans can include a maximum deductible of $505.00 in 2023.
- Some Part D plans have no deductible.