Two parts of Medicare are provided by the federal government (Original Medicare)

 

Part A – Hospital Insurance

Part B – Medical Insurance

Original Medicare is health insurance, but results in a beneficiary having financial gaps in coverage: deductibles, coinsurance and no cap on out-of-pocket expenses. If a beneficiary has Original Medicare, there will be an effective date for Part A and another effective date of Part B on their Medicare Card (the dates can be the same or different, depending on the enrollment date for Part B).

Medicare Part A – Hospital Insurance

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1) Covers hospital and skilled nursing facility stays, some home health and hospice care

2) Premium: $0 for most people if you or your spouse/former spouse paid Medicare taxes for at least 40 calendar quarters (10 years)

3) Has a deductible in 2021 of $1,484… per benefit period. A new benefit period occurs once a beneficiary has been discharged from the hospital for 60+ days

Medicare Part B – Medical Insurance

1) Covers medically necessary services and some preventive services like doctor visits, lab tests, outpatient hospital care and durable medical equipment

2) Premium: $148.50 for most people in 2021, however those considered “higher wage earners” pay higher amounts. (See Blogs #1 and #5)

3) Has an annual deductible in 2021 of $203

4) Coinsurance: Medicare pays 80%, of covered benefit… you pay 20%

5) Medicare Part B can be deferred with no penalty if you have equivalent "creditable" coverage through an employer health plan (self/spouse)

To choose any additional Medicare plan, a beneficiary must have Medicare A and B and continue to pay their Part B premiums.

How do you fill in the gaps or expand the coverage provided by Medicare?

Most people enroll in a Medicare Supplement Plan or a Medicare Advantage Plan. These types of plans are mutually exclusive. This represents the basic health coverage decision, once you’re eligible for Medicare. Will you be better served on a Medicare Supplement Plan or a Medicare Advantage plan? That depends… we can help you make the decision that’s best for you, usually after a conversation and some analysis.