In 2010, the U.S. had almost 47 million Medicare beneficiaries.
Medicare, the national health insurance program used mainly by senior citizens, comes in four separate parts. Original Medicare consists of Parts A and B. Part A covers inpatient hospital services while Part B covers outpatient hospital care and preventive services. Part C, called Medicare Advantage, allows buyers to purchase plans from private insurance companies. Part D covers prescription drugs. Each part has its own own set of copayments and coinsurance costs. Coinsurance and copays are similar, but copays are a fixed amount charged for services while coinsurance payments cover a percentage of service costs.
Part A
Part A Medicare offers benefits for inpatient hospital services, skilled nursing care with a qualifying inpatient hospital stay, home health care, inpatient mental health care and hospice services. Part A is the only part of Medicare which is mandatory; you are not required to buy any other Medicare policy to use the program, although you must generally have Part A before you can enroll in B, C or D. Part A copays mainly concern inpatient stays and change depending on the length of the stay. You must meet the annual Part A deductible before the copayment costs apply. In 2011, the copay for a hospital stay of 61 through 90 days was $283 per day. The copay for hospital stays of 91 to 150 days is $566 per day. The copay for skilled care in a nursing facility is $141.50 for stays of 21 to 100 days.
Part B
Part B has benefits for outpatient stays, including mental health outpatient services, as well as other preventive services, such as health screenings and vaccinations. Most Part B services require a 20 percent coinsurance payment, but many preventive services are offered free of charge. Even if you receive a free service, you may owe the doctor or hospital facility a copay. Mental health outpatient treatment comes with a 45 percent coinsurance payment, although this is amount is due to go down after 2011.
Part C
The main benefit of Part C for many Medicare users is that they can get their parts A and B benefits from a private insurance company rather than the government. Medicare Advantage plans also usually offer additional benefits, such as vision, dental or hearing. The companies that sell MA plans are allowed to set their own copayments for services. The copays and coinsurance amounts also change depending on which kind of MA plan you buy, as Medicare Advantage policies can be sold as HMOs, PPOs, special needs plans and high-deductible policies that work with medical savings accounts.
Part D
Part D Medicare has benefits for prescription medications only. You may be able to get Part D benefits through a Medicare Advantage plan. You can also buy them as stand-alone plans. Part D is also sold by private insurance companies. The amount of Part D copayments and kinds of drugs covered varies. Part D also comes with a "donut hole" in coverage, in which benefits cease once you reach an initial coverage limit and you must pay all costs yourself until catastrophic coverage begins. Part D reforms that began in 2011 offer discounts on generic and name-brand drugs to users in the hole.
Tags: Medicare Advantage, inpatient hospital, Part covers, Part Part, preventive services
