Who is Medicare Insurance For?
Medicare is a federal government-based insurance plan for:
- Senior citizens aged 65 or older
- Younger people with disabilities
- People with End-Stage Renal Disease (EDRD)
- People with Amyotrophic lateral sclerosis (ALS) Lou Gehrig’s disease
The Different Parts of Medical Care
Medicare insurance consists of different “parts.” The parts of the insurance each cover different elements of care. While only four parts, the structure of Medicare is complicated enough to easily create a situation so tangled, it can seem hard to get anywhere.
To make sense of the different parts of Medicare, we cover each of the different parts in detail below.
Medicare Part A
Commonly known as Hospital Insurance, Medicare Part A covers inpatient care in hospitals. That means that for most routine care received within hospitals, you will be covered. Typical inpatient care includes most generalized hospital services:
- Semi-private or shared rooms
- Nursing services
- Necessary drugs and prescriptions
- Hospital Supplies
Other Medical Part A coverage also includes:
- Critical Access Hospitals (CAH) designated by the Balanced Budget Act of 1997
- Skilled Nursing Facilities (SNF)
- Hospice care
- Home care
- Acute care hospitals and health care facilities
- Inpatient rehabilitation facilities
- Longterm care
- Most urgent care clinics
How much does Medicare Part A cost?
Medicare Part A is known as “premium-free.” The reason for that is because for most participants, Medicare is available if you paid Medicare taxes for 10 years or more of your life. As a general rule of thumb, if you are eligible for Social Security Benefits, you’ll also be eligible for Medicare.
If you are not eligible for “premium-free Part A” and are instead paying for Medicare Part A, you’ll pay one of the following amounts:
- $422 every month if you paid Medicare taxes for less than 30 quarters (7.5 years)
- $232 each month if Medicare taxes were paid for 30-39 quarters (7.5 years to 9.75 years)
What Does A Hospital Stay Cost Under Medicare Part A?
If you are exercising your coverage under Medicare Part A, here is what you can expect to pay for an average hospital stay:
- $1,340 deductible for up to 60 days.
- $0 coinsurance for up to 60 days.
- $335 coninsurance per day after 60 days.
- $670 coinsurance per lifetime reserve day after 60 days.
- All costs will be paid by the insured if lifetime reserve days are used.
Are there limitations on Medicare Part A?
There are certain limitations imposed on Medicare Part A and not everything is covered. These limitations include:
- Private nursing services
- Private rooms not included as part of medical treatment
- Television and phone services with a separate charge
- Generalized personal care or comfort items
Other limitations to keep in mind are that, while rare, not all health care facilities accept Medicare.
Enrolling in Medicare Part A
There is often confusion surrounding when and how to sign up for Medicare Part A. Enrollment is different for every person.
The best time to sign up for Medicare Part A is during your initial enrollment period.
Your initial enrollment period is 7 months long and starts 3 months before you turn age 65 and ends 3 months after the month you turn 65.
For example, if you turn 65 in the month of December, your initial enrollment period begins at the start of the preceding September and ends the last day of the following March. During this time, enrollment is expected and won’t result in penalties.
For those who enroll late, who are not eligible for “premium-free Part A” there could be penalties attached to your insurance, which could result in temporarily higher premiums.
Late enrollment penalties are structured as follows:
If you missed your initial enrollment period, you may see a penalty of 10% on your monthly premium for twice the number of years that you were eligible for Medicare, but weren’t paying. For example:
Suppose you were eligible at age 65 for Medicare Part A, but didn’t think about enrolling until two years later at age 67. Under this scenario, you might be required to pay an additional 10% penalty on your monthly premium for four years.
If an event prevented you from enrolling during your initial enrollment period, you may be eligible for a special enrollment period. To qualify for a special enrollment period, certain conditions may need to be met:
- You are covered under group health insurance from an employer.
- You or your spouse is working.
- If disabled, your family member is working.
- Employer-provided health care ends following employment recently ended
General enrollment period.
Between January 1 and March 31 of each year, Medicare Parts A and B can be signed up for during a General Enrollment Period (GEP). If you missed or were unable to sign up for coverage during your Initial Enrollment Period or your Special Enrollment Period, you may sign up during the GEP.
There may be penalties associated with signing up during the General Enrollment Period if you are enrolling late.
Medicare Part B
Medicare Part B covers “medically necessary” like doctors services, outpatient care, medical supplies and preventative care. That includes services like:
- Health care screening
- Clinical and laboratory research
- Necessary medical equipment
- Inpatien, outpatien, and partial mental health
- Pre-surgery second medical opinions
- Outpatient prescription drugs
The best way to find out exactly what your Medicare Part B insurance covers is to ask understand why you need any of the above services, and ask Medicare about specific coverage.
How much does Medicare Part B cost?
Unlike “Premium-free Part A” Medicare Part B carries premiums that must be paid for by all recipients. Here is what you can expect to pay in Part B premiums:
- $134 per month for annual income up to $85,000 or less (single) or $170,000 or less (joint).
- $187.50 per month for annual income between $85,000 and $107,000 (single) or between $170,000 and $214,000 (joint).
- $267.90 per month for annual income between $107,000 and $133,500 (single) or between $214,000 and $267,000 (joint).
- $348.30 per month for annual income between $133,500 and $160,000 (single) or between $267,500 and $320,000 (joint).
- $428.60 per month for annual income above $160,000 (single) or above $320,000 (joint).
If you are exercising your coverage under Medicare Part B, here is what you can expect to pay:
- $183 per year for your deductible. After your deductible, you will pay 20% of the approved amount for doctor services, outpatient treatment, and medical equipment.
Enrolling in Medicare Part B
Enrolling in Medicare Part B follows the same rules as enrollment in Part A. For rules on enrollment, please see enrollment procedures for Part A above.
Medicare Part C
You can learn more about Medicare Part C, here.
If you have any questions about Medicare Insurance, please feel free to give us a call.