What Is Medicare?

Medicare is a national health insurance program administered by the Centers for Medicaid and Medicare Services of the U.S. federal government. It provides health insurance for Americans aged 65 and older who have worked and paid into the system through the payroll tax. It also provides health insurance to younger people with some disabilities, as well as people with end stage renal disease and amyotrophic lateral sclerosis. 

Medicare Part A (Hospital Insurance)
Medicare Part B (Medical Insurance)
Medicare Part C (Medicare Advantage Plans)
Medicare Part D (prescription drug coverage)
Medicare Supplement (Medigap)
Medicare Part A (Hospital Insurance)

  • Hospital care – covers inpatient hospital, skilled nursing facility care, and long-term care
  • Skilled nursing facility care – Medicare-covered services include, but aren’t limited to:
    • Semi-private room (a room you share with other patients)
    • Meals
    • Skilled nursing care
    •  Physical and occupational therapy (if they’re needed to meet your health goal)
    • Speech-language pathology services (if they’re needed to meet your health goal)
    • Medical social services
    • Medications
    • Medical supplies and equipment used in the facility
    •  Ambulance transportation (when other transportation endangers health) to the nearest supplier of needed services that aren’t available at the SNF
    • Dietary counseling 
  • Nursing home care -may cover care in a certified skilled nursing facility (SNF). 
  • Hospice – is usually given in your home, but it also may be covered in a hospice inpatient facility.
  • Home health services

Medicare Part B (Medical Insurance)

  • Clinical research – All people with Part A and/or Part B are covered, in qualifying studies.
    You may pay 20% of the Medicare-approved amount, depending on the treatment you get. The Part B deductible may apply. Medicare will help pay for some of your costs if you join a covered clinical research study. Medicare pays routine costs for items and services, including:
    • Room and board for a hospital stay that Medicare would pay for even if you weren’t in a covered research study.
    • An operation to implant an item that’s being tested.
    • Treatment of side effects and complications that may result from the study
  • Ambulance services -Medicare Part B (Medical Insurance) covers ambulance services to or from a hospital, critical access hospital (CAH), or skilled nursing facility (SNF). Medicare covers and helps pay for ambulance services only when other transportation could endanger your health, like if you have a health condition that requires this type of transportation. Medicare will only cover ambulance services to the nearest appropriate medical facility that’s able to give you the care you need. If you choose to be transported to a facility farther away, Medicare’s payment will be based on the charge to the closest appropriate facility. If no local facilities can give you the care you need, Medicare will pay for transportation to the nearest facility outside your local area that’s able to give you necessary care. 
  • Durable medical equipment (DME) – Medicare Part B (Medical Insurance) covers medically necessary durable medical equipment (DME) that your doctor prescribes for use in your home. Only your doctor can prescribe medical equipment for you.
  • Mental health
    • Inpatient -Medicare Part A (Hospital Insurance) covers mental health care services you get in a hospital that require you to be admitted as an inpatient. You can get these services either in a general hospital or a psychiatric hospital that only cares for people with mental health conditions.

    • Out Patient – Medicare Part B (Medical Insurance) covers mental health services and visits with mental health professionals. 
  • Partial Hospitalization – Medicare Part B covers partial hospitalization in some cases. Medicare helps cover partial hospitalization services when they’re provided through a hospital outpatient department or community mental health center.
  • Second opinion before undergoing surgery – If your doctor says you need surgery to diagnose or treat a health problem that isn’t an emergency. It’s up to you to decide when and if you’ll have surgery.
  • Limited outpatient prescription drugs -Medicare Part B covers a limited number of outpatient prescription drugs under limited conditions. Drugs that aren’t covered under Part B may be covered under Medicare prescription drug coverage (Part D)

Medicare Part C (Medicare Advantage Plans)

If you qualify for or are already enrolled in Original Medicare, you are eligible for Medicare Advantage. Medicare Advantage can provide both Medicare Part A and Part B coverage (hospital and medical benefits).  If you join one of these plans, you generally get all your Medicare-covered health care through that plan. Medicare Advantage Plans Requirements: 

  • Must have Part A and Part B
  • Offered as an alternative to Original Medicare
  • Combines many benefits of Part A, B and sometimes D
  • Must provide the same benefits in lieu of Original Medicare
  • Most Plans offer lower premiums than a Medigap policy
  • May require payments of copays and some coinsurance up to the annual out of pocket limit

Medicare Part D (prescription drug coverage)

Each Medicare drug plan has its own list of covered drugs (called a formulary). Many Medicare drug plans place drugs into different “tiers” on their formularies. Drugs in each tier have a different cost.

A drug in a lower tier will generally cost you less than a drug in a higher tier. Your prescriber may think you need a drug that’s on a higher tier. If so, you or your prescriber can sometimes ask your plan for an exception to get a lower copayment.

A Medicare drug plan can make some changes to its formulary during the year within guidelines set by Medicare. If the change involves a drug you’re currently taking, your plan must do one of these:

  • Provide written notice to you at least 60 days prior to the date the change becomes effective.
  • At the time you request a refill, provide both:
    • A written notice of the change
    • A 60-day supply of the drug under the same plan rules as before the change

Ways to Purchase a Prescription Drug Plan:

  • A stand-alone Prescription Drug Plan or PDP
  • May also be included in a Medicare Advantage plan with drug coverage or MAPD

Medicare Supplement (Medigap)

Medicare Supplement Insurance is a private health insurance policy designed to help pay some costs that are not covered by Medicare Parts A and B. When entitled to original Medicare and purchasing a Medigap policy, together they will both pay their covered shares leaving little to no out of pocket expense. When purchasing a Medicare supplement plan to “fill the gap”, you must also purchase a stand-a-lone Medicare prescription drug plan. 

  • You may be able to keep your same doctor or hospital. 
  • You and your spouse must each buy separate Medigap policies. Your Medigap policy won’t cover any health care costs for your spouse.
  • To buy a Medigap policy you must have Medicare Part A and Part B. 
  • Most insurance carriers offer the same plans A-L, however its important to compare rates to ensure a better priced plan.
  • It is illegal to have a Medicare supplement policy along with a Medicare Advantage Plan. You can only have a Medicare supplement with a stand- alone- prescription drug plan, or Medicare Advantage Plans with Drug coverage.

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