It may come as a surprise, but not everything is covered by medicare. We’ll explain what medicare covers and what it doesn’t so you can be fully prepared.
Are you close to retiring? Good for you! You deserve it after all your many years of service to society as well as your family.
Along with your well-earned retirement, you now qualify for Medicare health coverage. You’ve probably heard of Medicare all of your professional life.
Are you familiar with what Medicare covers? What does Medicare not cover? Read further and familiarize yourself with the program so that you can avoid any future uncovered healthcare debt.
Medicare is the US government’s health insurance plan that provides health care coverage to US senior citizens 65 years old or older. Medicare is financed by many funding sources including the federal budget and deductions from American workers’ paychecks.
Today’s Medicare program is not restricted to senior citizens in retirement. Younger adults with specific medical disabilities can also receive Medicare coverage.
According to the Centers for Medicare & Medicaid Services (CMS), there are over 55 million Americans registered in the Medicare program.
Medicare became law in 1965 when Congress passed Title XVIII of the Social Security Act. Medicare was created to assist seniors at that time, who couldn’t secure health insurance, regardless of their medical history or income.
Don’t confuse Medicare with another government health program called Medicaid. Medicaid is both a federal and state program that provides health care coverage to low-income individuals of all ages.
Medicare provides its members access to hospitals, doctors and other medical professionals who accept Medicare. Medicare is called a fee-for-service plan.
That means that the Medicare patient pays a portion of the fee for each service and the Medicare system pays the rest.
Medicare offers different plans for different benefits and are labeled with different letters.
There are two basic parts to Medicare that are available to all recipients. They are called Medicare Plans A and B.
Plan A Medicare covers expenses like hospital stay costs and home health care services. Plan A Medicare members don’t pay monthly premiums for these basic services.
Plan B Medicare pays expenses for doctor visits or medical equipment fees. Plan B members pay $134 monthly premiums to cover these types of costs.
Both Plans A and B can’t pay for other common medical expenses like cosmetic surgery, hearing tests, or prescription medication. Additional coverage can be purchased from private insurance companies at higher premiums.
This additional coverage is called “supplement plans.”
Medicare supplement insurance plans (sometimes called Medigap or “Gap” plans) provides additional coverage for medical expenses beyond what Medicare Plans A and B cover.
Examples of these other expenses include deductibles, co-payments or medical fees incurred when traveling outside the US.
There are 10 plans available that provide levels of basic medical coverage beyond what’s offered in Plans A and B.
You can sign up for these plans through most private insurance companies and pay higher premiums for this additional coverage. Medicare then reimburses these Advantage Plan companies to cover your Plan A and Plan B costs.
It’s important to know what each Medicare supplement plan has to offer. No two plans are completely alike. Here’s an outline of the most common Medicare Supplement plans:
Supplemental Plan C covers hearing, vision and dental costs. This plan, however, will no longer be available to new Medicare members starting in 2020. People who became eligible for Medicare before that year can still choose to sign up for Medicare Supplement Plan C benefits.
Supplement Plan D is an extra benefit that pays prescription drug expenses. Private insurance companies can also coordinate this coverage. Enrollees who live in Medicare Plan D service areas can sign up for this coverage.
Supplement Plan F can pay for nursing facility and hospice care co-payment costs. Plan F can also pay up to 80 percent of any emergency medical costs you run up incurred while you’re out of the country.
Plan F can also cover 100 percent of Plan A and Plan B benefits for another 365 days, once they’ve been exhausted.
Supplement Plan G can help pay for hospitalization costs for 365 additional days beyond what Plans A and B cover. Blood transfusions and nursing facility and hospice co-payments are also completely covered with Supplement Plan G.
Supplement Plans K , L, and M are alike in that they pay a portion of the expenses beyond what Plan A and Plan B covers. Supplement Plan K will help with 50 percent of nursing facility and hospice care costs while Supplement Plan L will help pay 70 percent of these same costs. Supplement Plan M covers 20 percent of these same costs.
Supplement Plan N covers costs such as lab work or ambulance transport fees. Supplement N can also pay for imaging and other medical services.
Still have some lingering questions about what Medicare covers? Is a Medicare Supplement Insurance plan right for you and your spouse when you retire?
If your retirement date falls after the expected end of Supplement Plan C in 2020, then you will need to look for some alternatives.
You can find out more details on each of these Medicare supplement plans on the comparison chart here that outlines the benefits of each of these supplemental plans. These charts are a great way to educate yourself on what does Medicare pay for.
The coverage scenarios are varied and worthy of your review. If you’re in retirement or close to it, you should learn all that you can.
Get the most out of that benefit you’ve been waiting your entire career to enjoy.