Medicare and Medigap Blog

Medicare Insurance Basics

Medicare Insurance is a Health Insurance Program For:

  • People Age 65 or Older,
  • People under age 65 with certain disabilities, and
  • People of all ages with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a kidney transplant.)

Medicare Insurance Benefits Plan Basics:

Medicare Part A (hospital) pays for in-patient hospital services, skilled nursing facility care after a hospital stay, home health care, and hospice care. Medicare Part A also pays for all but the first three pints of blood in a calendar year.

Medicare Part B (medical) pays for medical expenses, clinical laboratory services, and outpatient hospital treatment. In most cases, Medicare Insurance pays 80 percent of the cost of covered services.

Covered medical expenses include physicians´ services and supplies. Some Medicare Part B services are paid as a fixed copayment under the outpatient prospective payment system.

Medicare Part B also pays for some preventive services. Ask your physician about screening tests, flu shots, and vaccines covered by Medicare.

Medicare prescription drug coverage (also called Medicare Part D) pays for prescription drugs, both generic and brand name. You must join a prescription drug plan to have this coverage.

Options for receiving Medicare Insurance benefits

Medicare enters into annual contracts with insurance companies and managed care plans to provide coverage through different types of health plans. The original Medicare plan is available to everyone. Original Medicare is also sometimes called Medicare fee-for-service or traditional Medicare. You can go to any doctor or hospital that accepts Medicare. Original Medicare coordinates with most group retirement plans, Medicaid, Medicare savings programs, and Medigap insurance.

You may have the option to join a Medicare Advantage plan (formerly called Medicare + Choice). Medicare Advantage plans include health maintenance organizations (HMOs), preferred provider plans (PPOs), private fee-for-service plans (PFFS), and medical special needs plans. You can only join a Medicare Advantage plan if a plan is available in your area and you have Medicare Parts A and Part B. Some plans may have additional eligibility requirements. The federal Centers for Medicare and Medicaid Services (CMS) administers Medicare Advantage plans. Plans provide their members with a handbook upon enrollment that outlines the complaints and appeals process for denial of services.

CMS publishes a handbook, called Medicare and You, that describes Medicare coverages and health plan options. The handbook is mailed to every Medicare beneficiary each year.

Services Not Covered by Medicare Insurance Benefits

  • Long-term care services (generally not covered) 
  • Private-duty nursing care
  • Most dental care and dentures.  
  • Healthcare received while traveling outside the United States, except under limited circumstances
  • Custodial care, such as help walking, getting in and out of bed, dressing, bathing, toileting, shopping, eating, and taking medicine (these are commonly referred to as activities of daily living)
  • More than 100 days of skilled nursing facility care during a benefit period following a hospital stay (the Medicare Part A benefit period begins the first day you receive a Medicare-covered service and ends when you have been out of the hospital or a skilled nursing facility for 60 consecutive days)
  • Homemaker services
  • Cosmetic surgery and routine foot care
  • Routine eye care, eyeglasses (except after cataract surgery), and hearing aids.

What You´ll Have to Pay with Medicare

Both Medicare Part A and Part B have costs that you must pay. These include monthly premiums, deductibles, copayments, and coinsurance. You also pay the full cost of services not covered by Medicare.

Premiums are amounts you pay regularly to keep your coverage. Most people do not have to pay a Part A premium, but everyone must pay the Part B premium. The premium amounts may change each year in January. A deductible is the amount you must pay for covered medical expenses before Medicare begins to pay. A copayment is a fixed charge for a medical service. Coinsurance is the percentage of the cost of a covered service that you pay after Medicare pays its portion of the cost.

Health care providers who "accept assignment" agree to limit their fee to the Medicare-approved amount for a service or supply, although you must pay any deductibles, coinsurance, or copayments due. Providers who do not accept assignment may charge as much as 15 percent above the Medicare-approved amount when treating Medicare patients. You must pay the excess amount. The amount you owe is shown on the Medicare Summary Notice that you receive from Medicare. If you were charged more than the 15 percent and paid it, your provider must refund the excess charges to you within 30 days. If you believe a provider has overcharged you, question the bill before you pay it and contact the Medicare carrier that processed your claim.

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Brandon Todd is a Patient Advocate, a Licensed Insurance Agent and a Passionate Entrepreneur with a passion for creating unique and abundant win-win relationships.

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