Medicare is the national health insurance program to which all Social Security recipients who are either over 65 years of age or permanently disabled are eligible. This also includes individuals receiving railroad retirement benefits and individuals suffering from end stage rental disease.
Medicare is a national program and is not a welfare program; it should not be confused with Medicaid. The assets and income of a Medicare beneficiary are not a consideration in determining eligibility or benefit payment.
Coverage under Medicare is similar to that provided by private insurance companies: it pays a portion of medical care. Medicare has two coverage components: Part A and Part B.
- Part A – covers inpatient hospital care, hospice care, inpatient care in a skilled nursing facility and home health care services. Part A is financed largely through federal payroll taxes paid into Social Security by employers and employees.
- Part B – covers medical care and services provided by doctors and other medical practitioners, home health care, durable medical equipment and some outpatient care and home health services. Part B is financed by monthly premiums paid by Medicare beneficiaries.
|Part B Income Related Premiums|
|Beneficiaries who file an individual tax return with income||Beneficiaries who file a joint tax return with income||Income-related monthly adjustment amount||Total monthly premium amount|
|Less than or equal to $85,000||Less than or equal to $170,000||$0||$104.90|
|Greater than $85,000 and less than or equal to $107,000||Greater than $170,000 and less than or equal to $214,000||$42.00||$146.90|
|Greater than $107,000 and less than or equal to $160,000||Greater than $214,000 and less than or equal to $320,000||$104.90||$209.80|
|Greater than $160,000 and less than or equal to $214,000||Greater than $320,000 and less than or equal to $428,000||$167.80||$272.70|
|Greater than $214,000||Greater than $428,000||$230.80||$335.70|
Deductibles for 2015
- Hospital Deductible: $1,260.00 / Benefit period
- Hospital Coinsurance:
- Days 0 – 60: $0
- Days 61-90: $315 / Day
- Days 91-150: $630 / Day
- Skilled Nursing Facility Coinsurance: Days 1 – 20: $0; Days 21 – 100: $157 / Day
Medicare Advantage Plans (Part C)
Medicare Advantage Plans are offered by private companies approved by Medicare. If you join a Medicare Advantage Plan, you still have Medicare. You’ll get your Part A (Hospital Insurance) and Part B (Medical Insurance) coverage from the Medicare Advantage Plan and not original Medicare. Medicare pays a fixed amount for your care each month to the companies offering Medicare Advantage Plans. These companies must follow rules set by Medicare. However, each plan can charge different out-of-pocket costs and have different rules for how you get services (like whether you need a referral to see a specialist or if you have to go to only doctors, facilities or suppliers that belong to the plan for non-emergency or non-urgent care). These rules can change each year.
You usually get prescription drug coverage (Part D) through the plan. In some types of plans that don’t offer drug coverage, you can join a Medicare Prescription Drug Plan.
Drug Coverage (Part D)
Medicare offers prescription drug coverage to everyone with Medicare. To get Medicare drug coverage, you must join a plan run by an insurance company or other private company approved by Medicare. Each plan can vary in cost and drugs covered.
What’s Medicare Supplement Insurance (Medigap)?
A Medicare Supplement Insurance (Medigap) policy, sold by private companies, can help pay some of the health care costs that original Medicare doesn’t cover, like co-payments and deductibles. Some Medigap polices also offer coverage for services like medical care when you travel outside the U.S. If you have original Medicare and you buy a Medigap policy, Medicare will pay its share of the Medicare-approved amount for covered health care costs. Then your Medigap policy pays its share.
Medigap policies generally don’t cover long-term care, vision or dental care, hearing aids, eyeglasses or private-duty nursing.
A Medigap policy is different from a Medicare Advantage Plan. Those plans are ways to get Medicare benefits, while a Medigap policy only supplements your original Medicare benefits.