To qualify for Medicare, you must be a U.S. citizen or resident. You must also be 65 years old or older. If you are under age 65 years old, you must be permanently disabled for 24-months or longer in order to qualify for Medicare. Individuals with End-Stage Renal Disease may also qualify for Medicare benefits.
The federal Medicare program is made up of four parts that help cover specific services. Let’s take a look at them:
Medicare Part A is hospital insurance. It helps pay for inpatient care in hospitals and skilled nursing facilities, for hospice care and for home healthcare. Part A is free for most people. However, there is a $1,184 deductible* per benefit period. So one stay in the hospital could cost you over $1,000*.
After a 60-day period stay in the hospital, you are responsible to pay a $275/copay* per day for any stays between 61 and 90 days, a $550/copay* per day for any stays between 91 and 150 days, and any hospital stays after 150 days will require you to pay all hospital costs.
*Represents 2013 cost-shares that are subject to change in 2014.
Medicare Part B is medical insurance. This is optional coverage that helps pay for doctors’ services and other medical services. There is a premium for Part B. The Part B premium is $104.90*; however, it does vary for higher-income consumers. For most items, Medicare covers 80% of the cost. You pay the other 20%.
Together, Part A plus Part B is called Original Medicare.
For most items, Medicare covers 80% of the cost. You pay the other 20%, but after the $155 annual deductible* is met.
Medicare Part C is known as Medicare Advantage. These are private health insurance plans like HMOs and PPOs, and they combine hospital care, doctor visits and outpatient care in a single plan. If you enroll in a Medicare Advantage Plan, your Medicare benefits are managed by the plan you join. These plans provide all Part A and Part B benefits and help off-set costs like the Part A hospital deductible and the 20% of costs that Medicare does not cover. Members’ copays and coinsurances vary by plan.
Many Part C plans include extras like fitness and wellness programs and supplemental coverage for vision, dental and hearing. Many Medicare Advantage plans also include prescription drug coverage. This means you have one plan and one card for your medical and prescription coverage.
Medicare Part D plans help cover the cost of prescription drugs.
Let’s take a closer look…
Part D is prescription drug coverage with a unique product design. The federal government designed Part D to serve as insurance to help Medicare participants with the cost of their prescription drugs. Part D enrollment is a voluntary benefit and is not required. It serves as catastrophic coverage for those who have high prescription costs and it helps to keep costs manageable for those with lower prescription expenses.
And over the next 5 years those involved with Part D will be doing even more to provide opportunities to save by reducing the coverage gap.
There are two ways to get Part D coverage. You can enroll in a Medicare Advantage plan that includes medical and prescription drug benefits. Or you can join a stand-alone plan that covers only prescription drugs.
If you’re considering a Medicare Advantage plan that offers Part D coverage — and you want drug coverage — you must get it through the plan. You cannot join a stand-alone drug plan if you are enrolled in the Medicare Advantage plan. Or, if you are already in a stand-alone drug plan and you enroll in a Medicare Advantage plan, you will be automatically disenrolled from your stand-alone drug plan.
All Part D plans are run by private insurance companies approved by Medicare. Like all insurance plans, you pay a monthly premium to participate, and for each prescription, you’ll pay a portion of the cost. If you do not sign up for Part D when you are first eligible you may owe a late enrollment penalty which will be added to your monthly premium.
There are several Medicare Election Periods that you should know about.
The first is your Initial Coverage Election Period (ICEP) which is the period during which an individual newly eligible for Premera Blue Cross Medicare Advantage may make an initial enrollment request to enroll in a Premera Blue Cross Medicare Advantage plan. This period begins three months immediately before the individual's first entitlement to both Medicare Part A and Part B and ends on the later of:
The Initial Coverage Enrollment Period (ICEP) for Part B is the seven month period that begins three months before the month an individual meets the eligibility requirements for part B, and ends three months after the month of eligibility.
The Annual Election Period (AEP) takes place between October 15 and December 7 of each year. This is the only time you can sign up for a plan or change plans for the following year, unless you are eligible for one of the following other enrollment periods:
Medigap, also called Medicare Supplement Insurance, is sold by private insurance companies. Medigap policies help pay some of the health care costs that Original Medicare doesn't cover. If you have a Medigap policy, Medicare will pay its share for covered health care costs, and then your Medigap policy will pay its share.
As we’ve discussed previously, Medicare Advantage Plans are offered through private companies that contract with Medicare to provide you with all your Medicare benefits. When you are enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan, and are not paid for under Original Medicare. All of your medical expenses are paid directly, and your plan takes care of all the paperwork. Medicare Advantage Plans may offer supplemental benefits such as routine dental care, acupuncture, routine vision coverage, gym memberships, care outside of the United States and other services not covered by Original Medicare. (See summary information on Premera Blue Cross Medicare Advantage plan offerings: plan options promo, compare plan options promo.)
Finally, let’s define Medicaid. Medicaid is a government program that provides varying levels of hospital and medical coverage for people with low income and resources. Some people with Medicare are also eligible for Medicaid.
If you would like to talk with someone about Medicare and Medicare Advantage plans, please call 888-868-7767. (For TTY, dial 711.) Service is available seven days a week from 8 a.m. to 8 p.m. (Pacific time). Our experienced staff can answer your questions.
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