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Medicare Coverage Basics

MP900314367Understanding what Medicare is and what it does and doesn’t cover is important in making decisions. Becoming informed will help the process feel a little less intimidating.

An article in the Queens Chronicle, “What Medicare does and does not cover,” explains some of the basics about Medicare, with a special focus on what it does and does not cover. For starters, Medicare is the federal health insurance program for people who are 65 and older and for some young people with disabilities. It is managed by the Centers for Medicare & Medicaid Services, known as CMS. It is not Social Security, although Social Security does work with CMS to enroll people in Medicare.

A person can apply for Social Security benefits at age 62, with eligibility for Medicare three years later. Initial eligibility begins three months before the 65th birthday, extending through one’s birth month, and continuing for the next three months. So new enrollers have a seven-month window with open enrollment for 2017 coverage from October 15 until December 7.

Many people forget to file for Medicare. Sometimes it’s because they’re still working or because they already have another form of health insurance. This can be a costly mistake, along with knowing what Medicare does and doesn’t cover.

Home-care services can become prohibitively expensive and can often quickly deplete one’s life savings.

Medicare pays in full for the first 20 days in a nursing home and then in part for another 80 days. That can leave a patient responsible for a hefty co-payment. In addition, to be eligible, an individual must have a skilled-care need, like physical therapy.

Long-term care insurance might help, as it covers home care, assisted living care, and nursing home care. But many folks can’t get insurance due to the cost or an existing physical condition.

There are two main ways to be covered: original Medicare—Parts A and B—or a Medicare Advantage Plan (Part C). Some choose additional coverage like Medicare Supplement Insurance, which, along with Parts A and B, is also replaced by the Medicare Advantage Plan, or Medicare outpatient prescription drug coverage (Part D).

If you require services that Medicare doesn’t cover, you’ll have to pay for them yourself—unless you have other insurance or you’re in a Medicare health plan that covers them. Medicare covers 80% of medical bills and, to cover the difference, many seniors purchase Medicare Supplement Insurance, which costs around $200 to $300 per month. There’s also a Medicare Advantage Plan, or Part C. This replaces regular Medicare and the supplemental insurance.

Each Medicare Advantage plan can charge different out-of-pocket costs. These can be based on many factors, like whether the plan charges a monthly premium, whether it pays any of Medicare Part B premiums, whether it has a yearly deductible or any additional deductibles, and the amount you pay for each visit or service.

Some insurance companies charge high rates for supplemental coverage, so shop around. Look at several health insurance companies for the best prices.

Before you can enroll, you must first make sure that you are eligible. Here are a few different scenarios: a working person who has health insurance from their employer, a person who is retired and has health insurance from a group health plan from an employer, or a person who is retired and does not have any other health insurance. Eligibility and the impact of being enrolled may have an impact on how the non-Medicare policies pay health care bills, so it’s very important that you understand how one affects the other. Usually, Medicare pays first, and your group health plan coverage pays second, but every situation is different.

Reference: Queens Chronicle (October 6, 2016) “What Medicare does and does not cover”

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