New to Original Medicare during AEP? Start Here.
Monday October 19th, 2020
If you’re new to Medicare, this is a great place to start.
Unsure what your Medicare options are? Read this.
If you’re looking for tips to help you select a health plan, start here.
The word Medicare gets thrown around a lot. With often-used words, it’s important to take a step back and be sure you’ve got a basic understanding of what that word means. In this article, we’ll give you the 101 on Medicare, so you can tell the difference between parts A, B and D—plus a whole lot more. Let’s get started.
A brief history of Medicare
Medicare, often referred to as Original Medicare, is a national health insurance program of the United States federal government run by the Centers for Medicare & Medicaid Services (CMS). It’s available for people 65 or older regardless of income level, medical history or health. Those younger than 65 who have been on Social Security Disability for 24 months are also eligible for Medicare. President Lyndon B. Johnson first signed Medicare into law in 1965, and, in 1972, Medicare was expanded to cover people under 65 with a long-term disability. It’s a social program that provides health insurance to 60 million enrollees across the United States each year.
What Medicare covers
Original Medicare helps to pay for primary care provider visits, hospitalizations, preventive services, limited prescription drug coverage, skilled nursing facility care, home health care and hospice care. It does not include dental or hearing coverage or routine vision care. Here’s a full list of what Original Medicare covers.
Original Medicare is divided into two parts:
- Medicare Part A is Hospital Insurance and covers inpatient hospital, skilled nursing facility and hospice care stays as well as some home health care.
- Medicare Part B is Medical Insurance and covers certain doctors’ services, outpatient care, medical supplies and preventive services.
You may have also heard about Medicare Parts C and D. These are plans from private insurance companies, not the federal government.
- Medicare Part C is a Medicare Advantage plan from a private insurer that replaces Original Medicare Parts A and B. It may or may not include prescription drug coverage. You can learn more about Medicare Advantage in this article.
- Medicare Part D is prescription drug coverage to help cover the cost of prescription drugs including recommended shots or vaccines. To get Part D coverage, you must join a Medicare-approved plan that offers drug coverage such as a stand-alone Prescription Drug Plan or Medicare Advantage plan.
Original Medicare perks:
- Enrollees can go to any provider or facility that is enrolled in Medicare and accepting new patients.
- Pays for about 80% of covered medical costs, which leaves you to pay the remaining 20%.
Original Medicare gaps:
- Offers no cap on out-of-pocket expenses.
- Does not include routine dental or hearing coverage or routine eye exams.
- Prescription drug coverage is not automatic.
- No supplemental health or wellness benefits.
Original Medicare considerations
Original Medicare works on a traditional fee-for-service model. That means doctors are paid based on the number of services and treatments they perform. As a healthcare consumer, you manage and coordinate your care between different providers.
If you have complex or chronic health conditions, this could be an extra burden. You may instead want to choose a Medicare Advantage plan as well as a value-based care provider. A Medicare Advantage plan may provide additional support through a care team of nurses, case managers and other health professionals as well as benefits like over-the-counter allowances for medical devices like blood pressure machines to help you manage your condition. A value-based care primary care provider will serve as your medical home base, coordinating your care. A value-based care provider may offer a health coach and behavioral health specialist to further assist you.
How Original Medicare Works
- Sign up for Part A when you turn 65 if you’re not already getting Social Security or Railroad retirement benefits. Learn how here.
- Most people sign up for Part B at the same time to avoid a penalty later. Learn more about Part B and your situation here.
- If you qualify due to age you can sign up as early as three months before or as late as three months after your 65th birthday.
- For example, if your birthday is September 1 and you’re turning 65, you have from June 1 to December 1 to sign up. This is called the Initial Enrollment Period.
- If you miss the Initial Enrollment Period, you can sign up during Annual Enrollment Period or the General Enrollment Period:
- Annual Enrollment Period: October 15 through December 7 each year.
- General Enrollment Period: January 1 and March 31 every year.
- If you or your spouse continue working past 65 and are covered by a group health plan from an employer or union based on that work, you may qualify for a Special Enrollment Period:
- You have one month after the employment or employer/union-sponsored health insurance ends to sign up for Parts A and B. Parts A and B coverage begins depending on when you sign up. Learn more here.
If you need Part D coverage, you will need to enroll in a prescription drug plan through a private insurance carrier. Costs for that will vary by carrier, plan and area. If you are struggling to afford prescription drug costs, you may be eligible for Social Security’s Low-Income Subsidy or Extra Help program. See if you qualify and apply here.
Your Medicare Choices
Just as you have the option to have a private retirement fund in addition to your Social Security benefits, you also have the option to have a private Medicare plan. Depending on your health needs and goals, a private Medicare plan could help you save money and enjoy more perks like transportation to and from the doctor, fitness benefits, an over-the-counter product allowance plus dental, vision and/or hearing coverage. Learn more about Humana’s Medicare Advantage plans here. A Medicare Advantage plan could also give you access to the right care for you and your needs. Find out if a value-based provider is right for you.
Want to determine which Medicare plan type is right for you? Learn more here.