Medicare is a federal health benefits program which covers medical expenses for seniors age 65 or older and individuals under 65 years old with certain disabilities. Medicare insurance is administered by the Centers for Medicare & Medicaid Services (CMS), a division of the U.S. Department of Health & Human Services (HHS).
Medicare open enrollment is active from October 15, 2018, to December 7, 2018, meaning that if you’re 65 or older and eligible for Medicare this year, you’ll need to enroll during those dates to be guaranteed coverage. However, “Medicare” doesn’t refer to just one type of health insurance or insurance company.
Just like there are multiple health plans available from Blue Cross Blue Shield, Medicare offers different covered services, prescription drug plans, and points of service depending on which insurance plan you choose.
Medicare is broken down into four parts:
- Medicare Part A
- Medicare Part B
- Medicare Part C
- Medicare Part D
Medicare Part A
When most people think of Medicare, they’re thinking of Medicare Part A, also referred to as “Original” Medicare. Part A covers hospital stays, hospice care, care given in a skilled nursing facility, and a limited number of home health care services. Individuals 65 years of age and older are often automatically enrolled in Original Medicare since it does not have a monthly premium.
You might hear Part A referred to as “hospital insurance,” since it primarily covers patient care only once they’ve been admitted to a covered healthcare facility or qualified for certain types of home health care in which the patient cannot be admitted to an in-patient facility.
Medicare Part B
Part B is often called “medical coverage,” as it offers coverage for medical services such as outpatient care, ambulance and emergency services, certain types of medical equipment, and approved services and treatments recommended by your doctor. Together, Part A and Part B offer better coverage than Original Medicare alone. You’re automatically eligible for Part B once you’ve enrolled in Part A, but you’ll need to pay a premium each month to keep your coverage.
Medicare Part C
Medicare Advantage Plans cover all Medicare services (Part A and Part B), but they also offer additional benefits not covered by Original Medicare since they are covered by third-party insurance companies rather than the just the government.
There are several types of Medicare Advantage Plans, with some offering coverage for:
- Vision and dental services
- Alternative medicine
- Gym memberships
Depending on the administering insurance company, Medicare Advantage Plans have different:
- Maximum out-of-pocket costs
- Prescription drug coverage policies
Medicare Part D
Part D refers to Medicare’s prescription drug coverage options. Drug coverage can be included as part of your Medicare Advantage plan, but you can also enroll in Part D as a stand-alone option if you’re enrolled in Part A.
Medicare Supplement Insurance
Original Medicare plans cover 80% of your medical expenses, meaning you’re responsible for covering the remaining 20%. Medigap plans are meant to close the coverage gap. You can only enroll in Medigap insurance if you’re enrolled in Part A, but you cannot enroll in both Part C and a Medicare Supplement at the same time.
Keep in mind: Medicare Advantage Plans and Medicare Supplement Plans are often part of a preferred provider organization (PPO), meaning you’ll get better rates and guaranteed coverage from specific healthcare providers.