Understanding the Different Parts of Medicare
If you prove you’re disabled and win your claim for Social Security Disability Insurance (SSDI) benefits, you will become Medicare eligible. Like Social Security Disability, Medicare is a confusing and complicated program. This article explains the parts of Medicare and how they impact you.
What is Medicare?
Medicare is a federal health insurance program that helps cover healthcare costs for hospitals, doctors, laboratory tests, prescription medications, and medical equipment. Medicare does not cover all of your healthcare costs. For example it usually does not pay for vision or hearing checkups, dental care, or long term care services.
Medicare is not free either. Keep reading for information on what it covers and how much you may have to pay out of pocket after winning your SSD claim.
Four Parts of Medicare
Medicare has four parts: Parts A, B, C, and D. Let’s take a look at each part.
Medicare Part A: Hospital Insurance
Medicare Part A covers basic hospital services, including regular nursing, hospital meals, a semiprivate room (you may have to share), and medications, appliances, and supplies used by the hospital to treat you. It may also cover up to 100 days in a skilled nursing facility if you are transferred as part of your recovery, but only if your hospital stay has lasted at least 3 days and your doctor approves the nursing home care.
Most people do not have to pay a premium for Medicare Part A, which is a few hundred dollars, because it is covered by payroll taxes from when you worked. You will have to pay a deductible for each benefit period. In 2015 the deductible was $1,260.
A benefit period starts on the day you’re admitted to the hospital. It ends when you’ve stayed out of the hospital for at least 60 consecutive days. If you’re readmitted to the hospital after being out for 60 straight days, you will have to pay another deductible for the new benefit period. There is supplemental insurance, known as Medigap, to cover this situation.
Medicare Part A does not cover physicians services. Those are covered by Medicare Part B.
Medicare Part B: Medical Insurance
Medicare Part B pays for 80 percent of the following services:
- doctor visits;
- mental health care
- laboratory and diagnostic tests performed outside hospitals
- outpatient care
You will pay a monthly premium for Medicare Part B. In 2015 the premium was $104.90. There is also an annual deductible, which was less than $150 in 2014.
After you’ve met your annual deductible you pay 20 percent of the cost of approved services, which include:
- An annual wellness visit
- A one-time only preventive checkup, as long as you do this within the first year of signing up for Medicare Part B
- Medical services approved by a physician who has a relationship with Medicare
- Preventive screenings, diagnostic tests, and blood tests performed outside of a hospital
- Oxygen equipment
- Diabetic supplies
- Wheelchairs, walkers, canes, and other assistive devices such as back and knee braces
- Outpatient mental health treatment
Medicare Part C: Medicare Advantage
Medicare Parts A and B are what we usually think of when we hear the term Medicare. Part C is an alternative to Medicare that is managed by private health insurance companies.
Under Medicare Part C, or Medicare Advantage, the private insurance company must offer the same benefits as are offered through Medicare Parts A and B.
Most Medicare Advantage plans are run by health maintenance organizations (HMOs) or preferred provider organizations (PPOs). You may remember these terms from when you received employer-provided health insurance coverage. The HMO or PPO has the right to determine which doctors you treat with under the plan.
If you decide to purchase a Medicare Advantage plan, make sure you review the deductibles, copays, and premiums. Sometimes these plans are more expensive than traditional Medicare. The benefit of Medicare Advantage, however, is that there is an annual limit on out of pocket costs. There is no such limit with traditional Medicare.
What happens if you purchase a Medicare Advantage plan but want to return to regular Medicare? You can always return to Medicare, but you must do so during specific periods of the year. You can return to traditional Medicare from October 15 to December 7, and from January 1 to February 14. These are the periods of open enrollment from Medicare Advantage to Medicare.
Medicare Part D: Prescription Drug Coverage
Medicare Part D covers prescription medication costs. Private plans, not the federal government, handle this part of Medicare.
You can purchase stand-alone Medicare Part D coverage. You do not have to purchase it as part of a Medicare Advantage plan.
If you decide to buy a stand-alone drug policy, you will usually have to pay a premium that ranges from $30 to $60 per month. You may also have to pay copays for drugs. Make sure you check the differences between each Medicare Part D plan.
Here is an example of how much you have to pay under a typical Part D plan:
- Deductible: In 2015 you had to pay up to $320. Some plans had lower deductibles
- Copays: You pay the copays required by your Medicare Part D plan until the total cost of your medication for that year reaches a specific dollar limit – around $3,000 in 2015.
- Doughnut Hole: When you hit the dollar limit for the year on medication, you get a discount on your medication. The size of the discount depends on the medication and whether it is brand name or generic. When the amount of the discount received hits a certain limit, Medicare will step in and pay more of your costs.
A Richmond Social Security Disability Lawyer with Medicare Experience
Choosing and signing up for the right Medicare plan is a difficult decision. If you have questions about your eligibility after a disability approval, contact Social Security Disability Lawyer Richmond VA Corey Pollard for a free consultation.