ABC's of Medicare

The Parts of Medicare

What is Medicare Part A? What Does Part A Cover?

In General, Part A covers:

Inpatient care in a hospital
Skilled nursing facility care
Nursing home care (inpatient care
in a skilled nursing facility that’s
not custodial or long-term care)
Hospice care
Home health care

Part A does NOT cover many of the actual treatments that might occur during hospital or skilled nursing stays. Those fall under Part B.

The cost of Part A for most people at age 65 is $0. Most people, or their spouses, have accumulated enough credits by paying in to Medicare during their working years to have a zero cost. Those that do not, may have to pay premium.

What is Medicare Part B?

Part B covers 2 types of services:

Medically necessary services: Services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice.

Preventive services: Health care to prevent illness (like the flu) or detect it at an early stage, when treatment is most likely to work best.

You pay nothing for most preventive services if you get the services from a health care provider who accepts assignment.

Part B covers things like:

Clinical research
Ambulance services
Durable medical equipment (DME)
Mental health
Inpatient
Outpatient
Partial hospitalization
Limited outpatient prescription drugs

Part B also covers treatment for ailments like cancer or dialysis. These costs can be extremely high, so it is important to have Part B to cover them.

The cost of Part B is set by Social Security and it changes from year to year. Individuals in higher income brackets pay more than those in lower incomes brackets. How much you pay is determined by your adjusted gross income reported to the IRS over the past 2 years.

What is Medicare Part C?

Medicare Advantage Plans, sometimes called "Part C" or "MA Plans," are an “all in one” alternative to Original Medicare. They are offered by private companies approved by Medicare. If you join a Medicare Advantage Plan, you still have Medicare. These "bundled" plans include Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance), and usually Medicare drug coverage (Part D).

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Covered Services in Medicare Advantage Plans

Most Medicare Advantage Plans offer coverage for things Original Medicare doesn’t cover, like some vision, hearing, dental, and fitness programs (like gym memberships or discounts). Plans can also choose to cover even more benefits. For example, some plans may offer coverage for services like transportation to doctor visits, over-the-counter drugs, and services that promote your health and wellness. Plans can also tailor their benefit packages to offer these benefits to certain chronically-ill enrollees. These packages will provide benefits customized to treat specific conditions. Check with the plan before you enroll to see what benefits it offers, if you might qualify, and if there are any limitations. Learn more about what Medicare Advantage Plans cover.

Rules for Medicare Advantage Plans

Medicare pays a fixed amount for your care each month to the companies offering Medicare Advantage Plans. These companies must follow rules set by Medicare.

Each Medicare Advantage Plan can Charge Different Out-of-Pocket Costs. They Can Also Have Different Rules For How You Get Services, Like:

Whether you need a referral to see a specialist
If you have to go to doctors, facilities, or suppliers that belong to the plan for non-emergency or non-urgent care
These rules can change each year.

Costs for Medicare Advantage Plans

What you pay in a Medicare Advantage Plan depends on several factors. In many cases, you’ll need to use doctors and other providers who are in the plan’s network and service area for the lowest costs. Some plans won’t cover services from providers outside the plan’s network and service area. Learn about these factors and how to get cost details.

Drug Coverage in Medicare Advantage Plans

Most Medicare Advantage Plans include prescription drug coverage (Part D). You can join a separate Medicare Prescription Drug Plan with certain types of plans that:

Can’t offer drug coverage (like Medicare Medical Savings Account plans)
Choose not to offer drug coverage (like some Private Fee-for-Service plans)
You’ll be disenrolled

What is Medicare Part D?

Prescription drug plans or Part D help offset the costs of prescriptions. Even if you don’t take prescription drugs now, you should consider getting Medicare drug coverage. Medicare drug coverage helps pay for prescription drugs you need. Even if you don’t take prescription drugs now, you should consider getting Medicare drug coverage. Medicare drug coverage is optional and is offered to everyone with Medicare. If you decide not to get it when you’re first eligible, and you don’t have other creditable prescription drug coverage (like drug coverage from an employer or union) or get Extra Help, you’ll likely pay a late enrollment penalty if you join a plan later. Generally, you’ll pay this penalty for as long as you have Medicare drug coverage. To get Medicare drug coverage, you must join a Medicare-approved plan that offers drug coverage. Each plan can vary in cost and specific drugs covered.

There Are 2 Ways To Get Medicare Drug Coverage:

1. Medicare Drug Plans.

These plans add drug coverage to Original Medicare, some Medicare Cost Plans, some Private Fee-for-Service plans, and Medical Savings Account plans. You must have Medicare Part A (Hospital Insurance) and/or Medicare Part B (Medical Insurance) to join a separate Medicare drug plan.

2. Medicare Advantage Plan (Part C) or other Medicare Health Plan With Drug Coverage.

You get all of your Part A, Part B, and drug coverage, through these plans. Remember, you must have Part A and Part B to join a Medicare Advantage Plan, and not all of these plans offer drug coverage.

If you decide not to get it when you’re first eligible, and you don’t have other creditable prescription drug coverage (like drug coverage from an employer or union) or get Extra Help, you’ll likely pay a late enrollment penalty if you join a plan later. Generally, you’ll pay this penalty for as long as you have Medicare drug coverage. To get Medicare drug coverage, you must join a Medicare-approved plan that offers drug coverage. Each plan can vary in cost and specific drugs covered.