More than 40 million people received Medicare benefits in 2010.
Medicare is a health insurance program used primarily by those over 65. Medicare was first offered in only two parts, called A and B, which are still often referred to as "original" Medicare. Part A mainly covers inpatient hospital services, home health and hospice, while part B covers outpatient services like doctor visits, tests and imaging. Later, more Medicare options were added, including Part D that pays for prescription drugs. Only Part A coverage is mandatory.
Part B
While Part B is also considered original Medicare along with Part A, it is not mandatory. If you are automatically enrolled in both parts of original Medicare because you are already receiving Social Security, you will have to opt out of Part B if you don't want it. If you do not take for Part B when you first have the chance, and later change your mind, you will have to pay a late enrollment penalty. Part B has a number of out-of-pocket costs, including monthly premiums, annual deductibles and a 20 percent copay for most services.
Medicare Advantage
Another option for Medicare beneficiaries is Part C, more often called Medicare Advantage. Medicare Advantage plans combine the benefits of Parts A and B (except for hospice) with extras like vision, dental and hearing. Many MA plans also include prescription drug benefits. MA is sold according to service area by private insurance companies rather than the federal government. These companies decide their own premiums, deductibles, copays and benefits. Medicare Advantage plans take the form of HMOs, PPOs, special needs plans and high-deductible plans for use with medical savings accounts.
Part D
Part D Medicare offers coverage for prescription medications. If you are already getting this through an MA plan, you do not need to sign up for Part D. Part D plans are sold by private companies and have their own rules about deductibles, the kinds of medications they cover and coinsurance payments. Like Part B, if you don't enroll in Part D during your initial enrollment period for Medicare, and have no other creditable medication coverage, you will have to pay late fees.
Medigap
Medicare users can purchase supplement plans to help them pay for original Medicare's copays, coinsurance, deductibles and excess use charges. Medigap plans are not part of Medicare, but they are designed to work with Medicare. The pricing for Medigap policies can vary according to company. Medicare supplements will cover only one person. You and your spouse will have to purchase individual Medigap plans if you both want coverage.
Tags: Medicare Advantage, original Medicare, will have, Advantage plans, have late
