Medicare Parts

Medicare covers services (like lab tests, surgeries, and doctor visits) and supplies (like wheelchairs and walkers) considered medically necessary to treat a disease or condition. Medicare consists of four parts: Part A, Part B, Part C and Part D. Parts A and B are often referred to as “Original Medicare” since originally this was all that was offered. Medicare Parts A and B cover 80% of your medical costs. If you do not have other insurance, such as a supplement or an advantage plan, you will be responsible for the other 20%.

Medicare Part A
Part A You usually don’t pay a monthly premium for Medicare Part A (Hospital Insurance) coverage if you or your spouse paid Medicare taxes while working. This is sometimes called “premium-free Part A.” However, if you have to buy Part A, you’ll pay up to $426 each month (in 2014). In general, Part A covers:

  • Hospital care
  • Skilled nursing facility care
  • Nursing home care (as long as custodial care isn’t the only care you need)
  • Hospice
  • Home health services
Medicare Part B
Part B Most people pay the Part B premium of $104.90 each month (in 2014). In general, Part B covers:

  • Medically necessary services: Services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice.
  • Preventive services: Health care to prevent illness (like the flu) or detect it at an early stage, when treatment is most likely to work best. You pay nothing for most preventive services if you get the services from a health care provider who accepts assignment. Part B covers things like:
  • Clinical research
  • Ambulance services
  • Durable medical equipment (DME)
  • Mental health
    • Inpatient
    • Outpatient
    • Partial hospitalization
  • Getting a second opinion before surgery
  • Limited outpatient prescription drugs
Medicare Part C
Part C Part C is also called Medicare Advantage. Medicare Advantage is not a Supplement. Medicare Advantage operates differently than a Supplement. If you’re in a Medicare Advantage Plan or other Medicare plan, you may have different rules, but your plan must give you at least the same coverage as Original Medicare. Some services may only be covered in certain settings or for patients with certain conditions. Your out-of-pocket costs in a Medicare Advantage Plan depend on:

  • If the plan charges a monthly premium.
  • If the plan pays any of your monthly Medicare Part B premium.
  • The plan’s yearly deductible or any additional deductibles.
  • What you pay for each visit or service (copayment or coinsurance).
  • The type of health care services you need and how often you get them.
  • If you go to a doctor or supplier who accepts Medicare assignment
  • If you follow the plan’s rules, like using network providers.
  • If you need extra benefits and if the plan charges for it.
  • The yearly limit on your out-of-pocket costs for medical services.
Medicare Part D
Part D Part D is for prescription drug coverage for those individuals who have Medicare. A Prescription Drug Plan has its own list of covered drugs, called a formulary. Drug plans from different insurance companies 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. In some cases, if your drug is on a higher tier and your prescriber thinks you need that drug instead of a similar drug on a lower tier, you or your prescriber can ask your plan for an exception to get a lower copayment.
Supplements Medicare Supplements, also called medigap policies, are offered by insurance companies to cover some or all of the 20% that Medicare does not cover. There wasn’t any standardization of medicare supplement policies until 1981. There are now standardized supplements A, B, C, D, F, High Deductible F, G, K, L, M, and N. Not all companies offer all supplements. However, the supplements that are offered are identical in coverage from company to company. This makes comparison much easier. The cost of the supplement is in addition to the cost of Medicare Part B.

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