Understanding all the different parts of Medicare can be a lot like Costello trying to understand his side of the old Abbott and Costello skit “Who’s on First?” (Fun fact: Time magazine voted this the best comedy sketch of the 20th century!). There is a lot of confusing lingo and phrases that are difficult to understand. For instance, do you have or are you interested in a Plan C or a Part C? Do you fully understand the difference? When both the parts of Medicare and the Medicare supplemental plans are labeled by letters of the alphabet it can be tough to sort through it all. Let those of us here at Medicare Pathways be your guide.
Medicare Part A- Hospital Insurance
The government provides Medicare Part A to those who are eligible usually at no cost* (as long as you or your spouse has worked for at least 10 years). Part A provides beneficiaries with hospitalization insurance for any inpatient visits. For 2013, Part A has a deductible of $1184. It also has a co-pay of $296 for inpatient days 61 – 90 and a co-pay of $592 for inpatient days 91-150. Medicare Part A is one part of “Original Medicare”.
Medicare Part B – Medical Insurance
Medicare Part B is the second part of “Original Medicare”. It is also provided by the government; however it has a monthly premium of $104.90. This amount is typically deducted directly from the Medicare beneficiary’s Social Security check each month and provides the beneficiary with outpatient or doctor’s insurance. in 2013, Part B has a deductible of $147 and beyond that, the beneficiary is responsible for a 20% co-insurance for every service provided. The Medicare Part B Premium may be higher based on your adjusted gross income.
Medicare Part C – Medicare Advantage
This is where the confusion begins. Medicare Part C, or Medicare Advantage Plans, are NOT provided by the government. There is a rumor out there that claims a beneficiary will lose their Medicare if they sign up with a Medicare Advantage plan. This is false. A Medicare Advantage plan can offering more benefits than Medicare. Opting for a Medicare Advantage plan simply changes the way Medical claims are paid. A beneficiary’s claims will be paid by the Medicare Advantage company, not Medicare itself. By selecting a Medicare Advantage plan, the Medicare beneficiary will receive all of their Medicare benefits from a private insurance program. Medicare Advantage plans run off of an HMO, PPO, or PFFS network, so it is important to take the time to ensure that your existing doctors and hospital selections will be covered under the plan network. Otherwise, you may have to select new doctors. They are designed to have a low monthly premium, but there is cost sharing involved throughout the year in the form of deductibles, copays, and co-insurance (for example copays at the doctor’s office and for inpatient hospital days and a percentage of the cost for medical tests and surgeries). Medicare Advantage plans can also have built-in prescription drug coverage, eliminating the need for a separate prescription drug plan.
Medicare Part D
Medicare Part D is your prescription drug coverage. These plans are designed to give Medicare beneficiaries affordable prescription drug costs throughout the year. Each plan will have its own formulary, or list of covered medications that is required by law to contain at least two prescriptions for every therapeutic category. Again it is important to do your research in advance to see if the medications you take will be covered by the plan in which you choose to enroll.
Medicare Supplement Plans (also called Medigap plans)
Medicare Supplement Plans are labeled by letters A through N. While each individual plan will have differences from one another, every plan classified with the same letter has been standardized by the federal government. That means that each company that offers plans labeled by the same letter are not allowed by law to be any different in their benefits structure. They have a higher monthly premium than a Medicare Advantage plan, but they are more inclusive in what they cover. For instance the Medicare Supplement Plan F is the plan most commonly purchased because it is the most comprehensive. Remember the deductibles, co pays, and co insurance that Medicare Parts A and B leave behind? A Medicare Supplement Plan F will cover all of that. If a Medicare beneficiary has a Plan F, all they will be responsible for paying throughout the year is their monthly plan premium* (*for Medicare covered expenses. Please note that any Medicare supplement can only cover what Original Medicare covers.). This can make budgeting very easy. Also a Medicare Supplement Plan can give Medicare Beneficiaries a flexibility to receive their care at a number of places. As long as the doctor and/or hospital you choose to see accepts Original Medicare, they will accept your supplement as well. This makes a Medicare Supplement a perfect choice for all the Snowbirds and travelers out there. You can receive great medical coverage anywhere in the country. Medicare supplement Plans do not however have built-in prescription drug coverage. You would still need to select a separate Prescription Drug Plan, or Medicare Part D Plan, to receive affordable prescription drug coverage.
Which plan is right for me?
There are multiple ways for Medicare Beneficiaries to receive their supplemental coverage. So, “Who’s on First?” That depends on how you as an individual prefers to have your medical coverage structured. The government has given each of you many options to choose from. While it can certainly be confusing trying to keep all of the Parts and Plans straight, we here at Medicare Pathways are trained professionals who specialize in all of the Plans and Parts of Medicare. We work with multiple carriers to ensure that we can find an option to suit your needs, and would love to be your tour guide. We are happy to take the time to explain your options and ensure you select a plan that will be right for you. Please contact one of our knowledgeable Senior Benefit Advisors today by calling 1-866-466-9118 or click here to request a quote.
Medicare Pathway, Inc.