Medicare is a federal health-insurance program used by millions of people in the United States. Most people who qualify for Medicare are aged 65 and older. Traditional Medicare benefits, Medicare Part A, only cover a few services, such as in-patient hospital services, requiring users to purchase supplemental plans in order to gain additional benefits. Medicare supplement plans are offered by private companies who have been approved to work with Medicare. Exactly what plans you are able to buy depends on which state you live in, but there are 12 standardized Medigap policies available as of 2010.
Medicare Advantage
Medicare Advantage plans are run by private companies, but also include Parts A and B Medicare, just the same as if you were getting them straight from the federal government. Medicare Advantage plans are allowed to differ in most other ways, however, and their premiums, rules, deductibles and services will vary. Some offer prescription drug coverage, vision and/or hearing insurance. Medicare Advantage plans are offered in different forms as well. You can find them as HMO (health maintenance organization) policies, PPO (preferred provider organization) plans, special needs plans, private fee-for-service plans and health savings account policies. Which one you choose will depend on your budget, your personal preferences and your medical needs.
Medicare Part D
Medicare Part D is purely for prescription drug coverage. Although Part D is part of Medicare, you do not get Part D from the government but from private companies. You must be enrolled in Medicare Part A in order to qualify for Part D. Getting Part D is optional and results in having to pay a monthly premium. If you already have a Medicare Advantage Plan which covers prescription drugs, you do not need to also get Part D.
Medigap Standard Supplements
As of 2010, there are 12 different standard Medigap policies, lettered A through L. They all offer slightly different services and have different monthly premiums. Medigap A is the most basic. It covers hospital costs for up to an additional 365 days after Medicare Part A benefits run out, as well as the co-payments and co-insurance costs for Medicare Part B and your first three pints of blood, if needed. Medigap Plan F and J feature the most benefits, such as at-home recovery, foreign travel emergency costs, coverage of Medicare Part B excess charges, and skilled nursing facility and hospice co-insurance and co-payments. Both F and J are available as high-deductible plans, where monthly premiums are low but you pay for all costs up to $2,000. Plans K and L are also unique. Plan K covers 50 percent of the costs for Medicare Part B co-insurance, hospice co-insurance, the first three pints of blood, the Medicare Part A deductible and skilled nursing facility co-insurance and has an annual out-of-pocket limit of $4,620. Plan L is similar, but covers 75 percent of the same services instead of 50, and has an annual out-of-pocket limit of $2,310.
Tags: Medicare Part, Medicare Advantage, Advantage plans, Medicare Advantage plans, private companies, annual out-of-pocket, annual out-of-pocket limit
