Medicare Basics Breakdown
What’s next after you are enrolled in Part A & Part B?
Let’s breakdown the basic coverages:
- Part A
- Part B
- Medicare Advantage Plans (Part C)
- Prescription Drug Coverage Plans (Part D)
- Medicare Supplement Plan (Medigap)
Medicare Part A & Part B is considered original Medicare. It’s the foundation of your coverage.
Part A covers hospital stays and inpatient care, operating room and intensive care, hospice care, qualifying rehabilitation services and skilled nursing care. Remember that Part A does not cover you forever, and there are guidelines for the coverages you do get.
Part A will cover inpatient care if:
- You are admitted to the hospital as an inpatient at a doctor’s request.
- The hospital accepts Medicare.
- In some cases the hospital must approve your stay.
There are also guidelines for skilled nursing facility care. Part A will cover the first 20 days. Days 21-100 are partially covered, and you are responsible for the full cost after Day 101.
More details of Part A coverages can be found on the Medicare website.
This coverage covers doctor visits and wellness/preventive care services. Part B will also cover lab services, x-rays/MRIs, and other diagnostic tests. This coverage will also cover ambulance rides, out-patient surgery centers and emergency room visits.
More details of Part B coverages can be found on the Medicare website.
Medicare Advantage Plans (Part C)
Medicare Advantage Plans are offered by private insurance companies. The insurance companies contract with Medicare to provide you at least the same coverage as Original Medicare. Most of these plans will offer additional coverage beyond what Original Medicare provides, like dental, vision, and hearing benefits as well as free gym memberships.
These plans are commonly set-up as Health Maintenance Organization (HMO) plans, Preferred Provider Organization (PPO) plans or Medical Savings Account (MSA) plans, just to list a few.
You will need to be enrolled in both Part A & Part B to eligible for a Medicare Advantage plan.
Prescription Drug Coverage Plans (Part D)
Prescription drug coverage is an optional benefit offered to everyone who has Medicare. However, not enrolling in a PDP when first eligible puts you at risk for a late enrollment penalty. There are exceptions to late enrollment penalties if someone has had prior credible coverage, qualify for extra help or low income subsidy.
You can enroll in a prescription drug plan one of two ways:
- A standalone Medicare Prescription Drug Plan (PDP)
- Medicare Advantage Plan (Part C)
Prescription Drug Plans have their own unique “formulary” or list of prescriptions drugs they cover. Each covered drug is listed on a tier on the formulary. The tier will determine the copay amount at the pharmacy. For example, Tier 1 drugs would be the least expensive (more common generic drugs), where a Tier 4 or Tier 5 drug will be more expensive.
Because formularies vary between plans, it’s important to review your plan annually.
Every year, during the Annual Enrollment Period (October 15-December 7) you have the opportunity to compare Part D plans. During this time you can change to another Part D plan. This change would be effective January 1st of the following year. It’s important to compare because plans change each year, and you want to make sure that you are on the plan that best fits your needs.
Breaking down the basics of Medicare coverages can be an overwhelming topic. If you want to learn more about the parts of Medicare, how they can affect your own health insurance, or which plan is best for you, let us help!
Call us at 636-232-3139 and we can schedule a no-cost review!