Basic Information About Medicare

If you are over 65, disabled and under 65, or if you have End-Stage Renal disease, you are entitled to enroll in a Medicare health insurance program.

There are three components to Medicare.

Overtime Medicare has increased the number of plans you can choose from. There is now the original Medicare Plan plus the Medicare Advantage Plans which include a HMO, PPO Plans, Medicare Special Needs Plans, Medicare Private Fee-for-Service Plans, Medicare Cost Plans and Medicare Prescription Drug Plans.

Medicare also covers some common items and services such as Ambulance services, Chiropractic services, Clinical trials, Diabetic Self Management Training, Diabetic supplies, Durable medical equipment, Emergency room services, Eyeglasses, Foot exams and treatment, Hearing and balance exams, Kidney dialysis services, Long-term care, Medical nutrition therapy services, Mental health care, Practitioner services, Prosthetic/orthotic items, Second surgical opinions, Smoking cessation counseling, Surgical dressings, Telemedicine in some rural areas, Test-X-rays, MRIs, CT scans, EKGs when medically necessary.

Medicare Part A

Medicare Part A is the "Hospital Insurance" portion of Original Medicare. Most people that are eligible for Medicare do not have to pay for Part A coverage. Those persons that are eligible, but have not paid enough into the Medicare program through payroll deductions during working years are able to pay a set monthly premium to participate. The amount that those people must pay is based on how many years they or their spouse worked in the United States. For most persons over the age of 65, enrollment in Medicare Part A is automatic. If you are registered with the Social Security Administration, you will receive information and a Medicare ID card approximately 3 months before your 65th birthday.

Medicare Part A is health insurance that helps pay for inpatient medical care in the hospital, skilled nursing facilities, hospice care and limited home health care. There are annual deductibles that must be met per benefit period for inpatient hospital services. For prolonged hospital stays, there are daily coinsurance amounts that must also be paid by the Medicare recipient. For 2007, the inpatient hospital deductible is $992 per benefit period. There is no coinsurance for the first 60 days of hospitalization. For days 61-90 there is a $248 coinsurance per day, which increases to $496 per day for over 90 days. For skilled nursing facility care, there is no coinsurance for the first 20 days, after which the coinsurance is $124 per day, up to 100 days. Medicare Part A does not provide benefits for office visits, outpatient care, lab and radiology or ambulance services. These are benefits that are covered under the voluntary Medicare Part B program.

Medicare Part B

Medicare Part B is the "medical services" portion of Original Medicare. Prior to becoming eligible for Medicare, you will be given the option to enroll in Medicare Part B for an additional monthly premium. In 2006, the Medicare Part B premium is $88.50 per person, per month. If you do not accept Medicare Part B when it is first made available to you, there may be a penalty charge that will increase this monthly premium amount. Beginning in 2007, the Medicare Part B monthly premiums will be based on your income.

Medicare Part B provides health insurance coverage for medical items and services that are deemed "medically necessary" or are a Medicare-covered preventive service. Preventive health care include medical exams, lab work and screening shots. Additional benefits of having Medicare Part B include coverage for ambulance services, ambulatory surgery centers, blood, bone mass measurement, cardiovascular screenings, limited chiropractic services, clinical laboratory services, clinical trials, colorectal cancer screenings, diabetes screenings and self-management training, diabetic supplies, doctor services, durable medical equipment, emergency room services, limited eyeglass benefits, flu shots, foot examinations and treatment, glaucoma testing, hearing and balance exams, hepatitis B shots, home health services, kidney dialysis services and supplies, mammograms, medical nutrition therapy, mental health care, occupational therapy, outpatient hospital services, outpatient surgical services, pap test and pelvic exams, physical therapy, practitioner services, prosthetics, second medical opinions, smoking cessation programs, transplant services and urgent care.

Some of the covered services under Medicare Part B require a coinsurance or a deductible. Medicare Part B does not provide prescription drug benefits, except for certain injectable cancer drugs. Medicare Prescription Drug coverage is offered through Medicare Part D.

Not covered under either Part A or B

Some of these services may be covered if you elect join one of the other plans offered. You can also look for coverage of these procedures in a Medicare supplemental insurance policy.

Acupuncture, dental care/dentures, cosmetic surgery, custodial care, eye refractions, hearing aids, hearing test order by someone other than your doctor, long term care, special shoes, some diabetic supplies are not covered.

Medicare Part D

Medicare Part D is the new optional prescription drug coverage program that allows Medicare eligible persons to add prescription coverage for an additional monthly premium. These plans are available through private health insurance companies that have been approved by Medicare. The monthly premium will vary based on the type of prescription drug plan you choose. You may also be required to pay an annual deductible and coinsurance, which will also vary based on your plan selection. Medicare Part D plans have contracts with specific pharmacies and each has a list of the covered drugs, called a formulary. It is important to know which pharmacies and what drugs are covered under the plan that you select to make sure that the plan meets your needs geographically and medically.

For 2007, the standard annual deductible for Medicare Part D will be $265. This means that you pay the first $265 of your prescription drug costs each year before your Part D benefits begin paying. Medicare Part D will cover the cost of your medications each year, up to a $2,400 limit. From $2,400 to $3,850 in annual drug costs, you are responsible for paying 100% of the drug costs. This is often referred to as the Medicare Part D "doughnut hole". If your prescription drug costs exceed $3,850 per year, you will have a 5% coinsurance, or $2.15 for generic and $5.35 for brand name drugs. Premium and coinsurance assistance may be available to low-income persons. Prescription drug coverage may also be available separately to persons enrolled in a Medicare supplemental or Medicare Advantage plan.

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