Making Sense of Medicare
Medicare is confusing, and your choices when you go on Medicare are critical. You are inundated with telephone calls, mail, and television advertisements. There is a lot of information to sort through. I am dedicated to helping you make an educated and informed decision about your healthcare. I can explain how Medicare works, answer your questions, and review your options.
Original Medicare (Part A and Part B) will not cover all your medical expenses. There are deductibles, coinsurance, and copays. The solution to have these out-of-pocket costs covered is to enroll in a Medicare Supplement Plan.
Part A of Medicare (Inpatient)
Hospital Inpatient Care
Skilled Nursing Facility (Rehab and Recovery Care)
Part A of Medicare is free for most people
Part B of Medicare (Outpatient)
- Part B of Medicare covers outpatient medical services and treatments received at a Doctor’s office, Hospital, or Clinic to examine, diagnose, and treat your health conditions.
- There is an annual deductible of $226 for Part B medical services, and after the deductible is met, Medicare only covers 80% of Part B medical expenses. Most Medicare Supplement Plans will cover the 20% coinsurance.
- You pay a monthly premium to the government for your Part B coverage. If your income exceeds a certain amount, your premium could be higher than the standard premium. The standard Part B premium for 2023 is $164.90.
Part C of Medicare (Advantage Plans)
Part C of Medicare refers to private health insurance plans. Insurance companies approved by the Center for Medicare and Medicaid Services offer Medicare Advantage plans. These private health plans are not considered supplemental Medicare coverage.
These plans must provide the same benefits as Original Medicare (those covered under Parts A and B); however, each plan can charge different out-of-pocket costs and have different rules for getting services. If you enroll in one of these plans, you must continue to pay the Medicare Part B premium of $164.90.
What is the Downside of Medicare Advantage?
- You leave Medicare, and your primary coverage is with an insurance company
- Advantage Plans have networks (HMO or PPO). The doctors and hospitals you can see will be limited.
- If you want to go to a doctor or hospital, not in the plan’s network, you’d have to pay all or a significant portion of the cost.
- When you travel, you are out of network.
- Advantage Plans are managed care plans that require pre-authorization for many medical services and treatments, which could mean delay or denial of medical care. The plan can dictate which doctors you see and what treatments you can get.
- You can think of Medicare Advantage plans as “pay as you go.” You have higher deductibles, copays, and coinsurance when you use the plan. You could face substantial out-of-pocket costs with an Advantage Plan, as much as $8,300 in a calendar year. Some plans set lower limits. With Original Medicare and a supplement, you pay a monthly premium but have very low out-of-pocket costs.
Part D of Medicare
Part D of Medicare is the prescription drug benefit that covers outpatient prescription drugs at your pharmacy.
Private insurance companies with government contracts offer prescription drug coverage.
You pay a monthly premium to an insurance company for your Part D plan. You will have an annual deductible to meet and pay copays or a percentage of the drug’s cost.
- Each Medicare prescription drug plan has a list of covered drugs called its formulary.
Medicare Supplement (Medigap)
- Medicare Supplements (Medigap) offered by insurance companies only supplement Original Medicare by filling in the gaps you would have to pay (deductibles, coinsurance, and copays). Medicare Supplements are considered your secondary coverage.
- With Original Medicare, you have nationwide coverage for doctors and hospitals – you can use it anywhere in the United States. If a doctor or hospital accepts Medicare, they will also take your Medicare Supplement, regardless of which company provides the coverage.
- Between Medicare and your Supplement, you will know what is covered and your costs for every medical service and treatment, leaving you with low, predictable medical expenses. That gives you peace of mind when you are on a retirement income.