What is Medicare
Are you eligible for Medicare? Welcome to a whole new kind of care.
For many Americans, healthcare is complicated and expensive.
For our Medicare members however, healthcare can be simple, affordable and remarkably caring.
What is Medicare?
Medicare is a federal health insurance program for eligible individuals U.S. citizens and legal residents, ages 65 and over and for some under 65 with a qualifying disability or with a diagnosis of end-stage renal disease or ALS.
Understanding Medicare can be overwhelming at first and as your healthcare partner, Clear Spring Health is here to help you wade through the mounds of Medicare information and help you choose the right plan for you.
Understanding Medicare
It’s important to understand Medicare so you can make the right choices for your future health needs.
As you near the age of 65 and begin to look at your Medicare options with its different moving parts and pieces, it may simply seem overwhelming. We are here to break those parts down for you, so you can understand the differences between Medicare Parts A and B, Medicare Advantage Plans and Supplemental or Medigap plans. When you are armed with the right information you will be ready to choose the right plan to meet your healthy aging goals.
- Medicare Part A
- Medicare Part B
- Medicare Part C
- Medicare Part D
- Medicare Supplement Plan
- Original Medicare
Medicare Part A – Hospital Coverage
Medicare Part A covers hospital expenses and care such as inpatient stays, drugs, labs, equipment, intensive care, surgeries, and skilled nursing care.
Medicare
Part A
Did You Know?
- You will not pay a premium if you or your spouse worked and paid taxes for ten years or longer
- Coverage is nationwide and includes any qualified hospitals in the United States
- Coverage and costs are per “benefit period”
- Must be admitted as an inpatient and not on an “observation status”
- An additional 60 “lifetime reserve” days are available
Enrollment Window
You have plenty of time to sign up for Medicare: three months before your birth month, your birth month, and three months after your birth month. You have 7 whole months to make your decisions and enroll.
$ What Does Medicare Part A Cost?
While most people don’t pay a premium for Part A, there are other costs to be aware of in the way of deductibles. Here are the cost facts for Medicare Part A:
- $0 Premium for most people (check this vs. monthly premium, adjusted for income)
- Before Medicare will cover any hospitalization costs, you need to pay a deductible and the deductible can be assessed more than once in a year
- The 2020 Part A deductible for inpatient hospital coverage is $1.364 per benefit period up to 60 days. (Note: check the 2020 amount)
- $341 per day for days 61-90 in one benefit period
- No out of pocket
- Premium penalty for late enrollment
Medicare Part B- Coverage for Doctor Visits and Outpatient Care
Medicare Part B covers the cost of doctor visits, outpatient care, blood, and urine tests, medical equipment, and some preventative services such as physical and occupation therapy, diabetes screenings, and mental health care.
Medicare
Part B
Did You Know?
- Monthly premiums are adjusted for income
- You cannot be denied coverage
- Coverage is nationwide and includes any provider who accepts Medicare
- Coverage is nationwide and includes any provider who accepts Medicare
Medicare Cost Terms
Here are some terms you should know when we talk about the cost of Medicare Part A and Part B:
Premium – A fixed amount you pay for coverage, usually on a monthly basis
Deductible – A set amount you pay for services before your plan begins to pay
Copay – A fixed amount you pay at the time you receive a covered service
Coinsurance – The amount you pay when the cost of a service is split with you, usually by 80/20 %
$What does Medicare Part B Cost?
There are premiums and deductibles to consider when looking at the costs of Part B. Here are the cost facts for Medicare Part B:
- Most people need to pay a monthly premium to maintain their Part B coverage
- You will need to pay a deductible before Part B begins paying for services
- The 2020 Part B annual deductible is $185.00
- No out of pocket limit
Medicare Advantage Plan (Medicare Part C) – Combining your Coverage
Medicare Advantage plans (Medicare Part C) are administered by private insurance companies such as Clear Spring Health and offer extra benefits not available with Original Medicare.
Medicare Advantage plans consist of a network of health care providers that together provide you with additional benefits. Networks can be more efficient which results in lower overall health care costs. Some Medicare Advantage plans require you to use their network of providers. Others, such as Clear Spring Health, allow you to see the physician of your choice.
Before signing up for a Medicare Advantage Plan, you need to sign up for Medicare Part A and Part B and enroll in the Medicare Advantage Plan directly with the private insurer that offers the benefits that best suit your needs.
Medicare
Part C
Did You Know?
- Must be enrolled in both Parts A and B and live in plan service area
- Cannot be denied coverage based on current financial or health status including pre-existing conditions
- May be required to use provider and pharmacy networks
- Coverage and costs vary per plan and may change each year
- There may be an annual limit on out of pocket costs for covered service
- You may be charged a monthly plan premium
- Must continue to pay Part B premium to Medicare
- Most plans include prescription drug costs
All Medicare Advantage Plans Cover:
- All the benefits of Part A (except hospice care, which is still covered by Part A)
- All the benefits of Part B
In addition, most Medicare Advantage Plans Cover these extras:
- Prescription Drugs
- Emergency care covered at any facility and at a generally lower cost of services in-network
- Guaranteed maximum yearly limit on out of pocket costs for covered medical services. This is sometimes called, out-of-pocket maximum. Once the limit is reached, there is no charge for covered services for the rest of the plan year.
Medicare Advantage Plans may offer even more benefits such as:
- $0 monthly plan premium
- Dental exams, cleanings and X-rays
- Eye exams, eyeglasses and corrective lenses
- Hearing tests and hearing aids
- Wellness programs and fitness memberships such as Silver Sneakers
$What does Medicare Part C cost?
When you choose a Medicare Advantage plan, you will continue to pay a monthly Medicare Part B premium. While premium pricing varies, depending on the Medicare Advantage company you choose, many Advantage plans offer $0 premium plans and they also set the amounts for your deductible, coinsurance, and copays. You get an additional benefit with Medicare Advantage that is not available with Original Medicare: a limit on the annual amount you pay for your covered medical care (out-of-pocket maximum).
Learn More
Medicare Part D – Prescription Drug Coverage
Medicare Part D covers prescription drugs and is a stand-alone plan that is only available from private insurance companies if you choose to go with Original Medicare and would like to add prescription drug coverage (Parts A and B).
Every Medicare prescription drug plan has a list of drugs – known as a formulary, that are covered by the plan. While researching plans, be sure to compare your list of medications with the plan’s formulary to make sure your medications are covered.
Medicare
Part D
Did You Know?
- Must be enrolled in Part A, Part B or both
- May be required to use a pharmacy network
- Coverage costs vary by plan and may change each year
- You will be charged a premium penalty for late enrollment
- Specific brand name drugs and generic drugs are included in the drug list (Formulary)
- You will pay a monthly premium and sometimes a deductible as well as out of pocket costs for prescriptions
- Part D covers commercially available vaccines that are not covered by Part B
Tiered Formulary
The list of covered drugs is provided in accordance with a tiered formulary. Drugs are grouped into tiers based on cost and the lower the tier- the lower the cost. Deductibles are most often charged by tier as shown in the graphic below.
There are two ways to cover your prescription drug costs.
1. Purchase a Medicare Advantage plan that includes prescription drug coverage.
2. Purchase a stand-alone Part D plan to supplement your Original Medicare plan. Part D plans cannot be combined with Medicare Advantage plans. Like Medicare Advantage, Part D plans are offered by approved private insurance companies.
$What does Part D cost?
The cost of Part D depends largely on the plan you choose. You will pay a monthly premium and maybe a deductible. Out of pocket costs will also add to your Part D expenses. The costs of plans vary widely between the premium, drug prices and the list of drugs that are covered, depending on the tiered formulary.
Medicare Supplement Plan (Medigap)
Medigap plans are designed to help pay for costs that Medicare Parts A and B don’t cover, including copays, deductibles and coinsurance. You may combine Original Medicare, a Medicare Supplement plan (Medigap) and a separate Part D plan, but just like with Part D, you cannot combine a Medicare Supplement Plan with a Medicare Advantage Plan.
Medigap
Did You Know?
- Must be enrolled in Part A, Part B or both
- Best time to buy a Medigap policy is within the 6-month open enrollment period starting the month you turn 65 and during which companies are not allowed to use medical underwriting to determine eligibility
- Nationwide coverage is available, and you can choose your own provider with no network
- Plans are guaranteed to be renewable each year
- Plan premiums may vary, even with the same coverage
- Must continue to pay Part B premium to Medicare
- The federal government has standardized ten plan benefits – MA, MN and WI plans differ from standardized plans in other states
- Plans are offered by private insurance companies in your state
Original Medicare
Medicare Part A and Medicare Part B are the equivalent of what is sometimes referred to as “Original Medicare”. Often, people who don’t have additional coverage through an employer, sign up for Parts A and B at the same time.
Original Medicare still does not cover all your healthcare needs. Refer to the chart below for what is not covered by Original Medicare.
What Isn’t Covered
- Most care received outside of the U.S.
- Excess charges for services by doctors who don’t accept Medicare
- Long term care
- Dental
- Prescription Drugs
- Hearing aids, eyeglasses, and contacts
- Total cost of care
- Hearing
- Vision
- Fitness Memberships
Know your Choices
You Have Choices.
You can choose Original Medicare (Part A plus Part B), a Medicare Advantage Plan (Part C), or you can add Part D for prescription coverage to Original Medicare, and/or a Medicare Supplement Plan (Medigap) for additional coverage of benefits that you need such as dental, vision, and prescription drugs.
Medicare Coverage Choices
- The first step is to enroll in original Medicare
- Next, decide if you need additional coverage
- If yes, you have two options:
Option 1
Add one or both of the following to Original Medicare
Medicare Supplement (Medigap)
Medicare Supplement Insurance Plan
*Offered by private companies
Part D
Medicare Part D Plan
*Offered by private companies
Option 2
Choose a Medicare Advantage Plan
Part C
Combine Part A (hospital insurance) and Part B (Medical Insurance) into one plan
Part D
Usually includes prescription coverage
+
May offer additional benefits not provided by Original Medicare
How do I know if I need Additional Coverage?
Now that you are informed about Medicare and the differences between Original Medicare, Medicare Advantage plans Part C, Part D, and Supplemental plans you have the tools to make some decisions and choices. Consider your healthcare needs and how different plans will fit your healthy aging goals.
Concerned about making the wrong choice? Good news!
You are only committed to your choice until the next Annual Election Period, which is October 15 through December 7th and at that point you’ll be able to change your plan as your healthcare needs change.