What Does Medicare Cover?

Part A is insurance covering most inpatient hospital care or hospitalization, skilled nursing facility care, home health care, and hospice care. Most people don’t pay a premium for Part A because they or a spouse already paid for it through their payroll taxes while working.

Part B is insurance for outpatient and doctors’ services. Part B also covers some physical and occupational therapist services, and some home health care. Most people pay a monthly premium for Part B which is deducted from your Social Security check.

Part C refers to Medicare Advantage plans. Part C plans provide additional benefits to Parts A and B. This means you will have all Part A and B benefits and possible prescription drug benefits with a range of premium options.

Prescription Drug Coverage, also known as Medicare Part D provides coverage for some of your prescription drugs. Most people will pay a monthly premium for this coverage.

What Isn’t Covered By Medicare Part A and Part B?

Medicare doesn’t cover everything. Items and services that aren’t covered include, but aren’t limited to:

• Acupuncture.
• Deductibles, coinsurance, or copayments when you get health care services.
• Dental care and dentures (with only a few exceptions).
• Cosmetic surgery.
• Custodial care (help with bathing, dressing, using the bathroom, and eating) at home or in a nursing home.
• Eye refractions.
• Health care you get while traveling outside of the United States.
• Hearing aids and hearing exams for the purpose of fitting a hearing aid.
• Hearing tests (other than for fitting a hearing aid) that haven’t been ordered by your doctor.
• Long-term care, such as custodial care in a nursing home.
• Orthopedic shoes (with only a few exceptions).
• Prescription drugs — most prescription drugs aren’t covered.
• Routine foot care such as cutting of corns or calluses (with only a few exceptions).
• Routine eye care and most eyeglasses.
• Routine or yearly physical exams. (Medicare will cover a one-time physical exam within the first six months you have Part B.)
• Screening tests and screening laboratory tests except those specifically identified by Medicare. See Medicare and You for more details - www.medicare.gov
• Shots (vaccinations) except those specifically identified by Medicare. See Medicare and You for more details - www.medicare.gov
• Some diabetic supplies (like syringes or insulin unless the insulin is used with an insulin pump or you join a Medicare Prescription Drug Plan)

What is the Coverage Gap in Medicare Part D?

Most Medicare drug plans have a coverage gap. This means that after you and your plan have spent a certain amount of money for covered drugs, you have to pay all costs out-of-pocket for your drugs up to a limit. Your yearly deductible, your coinsurance or copayments, and what you pay in the coverage gap all count toward this out-of-pocket limit. The limit doesn't include the drug plan's premium.

There are some plans that offer some coverage during the gap, like for generic drugs. However, plans with gap coverage may charge a higher monthly premium. Check with the plan first to see if your drugs would be covered during the gap.

Catastrophic coverage - Once you reach your plan's out-of-pocket limit during the coverage gap, you automatically get "catastrophic coverage." Catastrophic coverage assures that once you have spent up to your plan's out-of-pocket limit for covered drugs, you only pay a small coinsurance amount or a copayment for the rest of the year.

What Are My Options?

The Original Medicare Plan —This is a fee-for-service plan that covers many health care services and certain drugs. You can go to any doctor or hospital that accepts Medicare.

Medicare Advantage Plans and Other Medicare Health Plans —These plans, which include HMOs, PPOs, and PFFS plans, may cover more services and have lower out-of-pocket costs than the Original Medicare Plan. However, in some plans, like HMOs, you may only be able to see certain doctors or go to certain hospitals.

Medicare Supplement Plans (Medigap) - A Medigap policy is health insurance sold by private insurance companies to fill gaps in Original Medicare coverage. Medigap policies don't work with any other type of health insurance, including Medicare Advantage Plans, employer/union group coverage, Veterans Administration (VA) benefits, or TRICARE. Medigap policies help pay your share (coinsurance, copayments, or deductibles) of the costs of Medicare-covered services. Some Medigap policies cover certain costs not covered by Original Medicare.

Medicare drug plans —Medicare prescription drug coverage started January 1, 2006. You can obtain prescription drug coverage through Medicare Part D plans or as part of your Medicare Advantage Plan, if applicable. 
 

What is the Original Medicare Plan?

The Original Medicare Plan is one of your health plan choices as part of the Medicare Program. You will stay in the Original Medicare Plan unless you choose to join a Medicare Advantage Plan or other Medicare Health Plan.

The Original Medicare Plan is a fee-for-service plan that is managed by the Federal Government. The rules for how the Original Medicare Plan works are below:

• You use your red, white, and blue Medicare card when you get health care.
• If you have Medicare Part A, you get all Part A-covered services.
• If you have Medicare Part B, you get all Part B-covered services. You usually pay a monthly premium for Part B.
• You can go to any doctor or supplier that accepts Medicare and is accepting new Medicare patients, or to any hospital or other facility.
• You pay a set amount for your health care (deductible) before Medicare pays its part. Then, Medicare pays its share, and you pay your share (coinsurance or copayment) for covered services and supplies (unless you have a Medigap policy).
• For more detailed information about Medicare-covered items and services, visit www.medicare.gov on the web, or call 1-800-MEDICARE (1-800-633-4227) to get a free copy of “Your Medicare Benefits” (CMS Pub. No. 10116).

What things should I consider when choosing Medicare coverage?

• Cost —What will you pay out-of-pocket, including premiums?
• Benefits —Are extra benefits and services, like additional drug coverage, eye exams or hearing aids covered? (These may be covered by some plans.)
• Doctor and hospital choice —Can you see the doctor(s) you want to see? Do you need a referral to see a specialist? Can you go to the hospital you want?
• Convenience —Where are the doctors offices? What are their hours? Is there paperwork? Are they accepting new patients? Do you spend part of each year in another state?
• Prescription drugs —Are they covered? Are your prescription drugs on the plan’s list of covered drugs (formulary)?
• Pharmacy choice —Can you use the pharmacy you want? Are the pharmacies convenient?
• Quality of care —How is the quality of the plans in your area? Information about quality is available at www.medicare.gov on the web.

Do I give up my Medicare benefits to join a Medicare Advantage plan?
No. You get the equivalent of your original Medicare benefits plus additional benefits.

What doesn't Original Medicare cover?
Medicare does not cover the Part A and Part B deductibles and coinsurance. It also does not cover items such as routine hearing, eye exams, and most outpatient prescription drugs.

Why is Part B optional?
Some people don't need Medicare Part B because they are still covered by an employer group plan or their spouse's health plan. However, if you do not join Part B right away and you are not covered under another health care plan, the Part B premium will increase 10 percent each year after you were first eligible to purchase it. Call 1-800-MEDICARE (1-800-633-4227) for more information, 24 hours a day, 7 days a week. TTY/TDD users should call 1-877-486-2048.

How do I choose between a Medicare Advantage plan and a Medicare Supplement plan?
There is no perfect answer. You need to select the plan that best meets your current financial and health care requirements. Many of these plans fill in gaps left by Medicare.

Original Medicare covers only those benefits listed under Part A (hospital care) and, when selected, Part B (doctor bills and other expenses), leaving you responsible for several out-of-pocket expenses, including the Part B deductible and Part A and Part B coinsurance. To enroll in either a Medicare Advantage plan or a Medicare Supplement plan, you must have Medicare Part A and Part B and continue to pay your Part B premiums (and Part A, if applicable) unless otherwise paid for by a third-party.

Medicare Advantage plans replace your Original Medicare benefits. If you join a Medicare Advantage plan (either PFFS (Private Fee For Service), HMO, or PPO), then you will use the health care card that you get from your Medicare Advantage plan for your health care. If you're in a Medicare Advantage plan, you don't need a Medicare Supplement policy.

Medicare Supplement plans allow you to enhance your Original Medicare coverage by selecting only those additional benefits that are important to you. You also maintain the freedom to visit any licensed doctor who accepts Medicare.

My income is very limited. It will be hard for me to pay the premiums and deductible under the Medicare prescription drug coverage. Is there any extra help for me?
You may be able to get extra help to pay for your prescription drug premiums and costs. To see if you qualify for getting extra help, call:

• 1-800-MEDICARE (1-800-633-4227). TTY/TDD users should call 877-486-2048, 24 hours a day, 7 days a week ;
• The Social Security Administration at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday; or
• Your State Medicaid Office.

Enrollment Periods: When Can I Enroll? When Can I Change?

Initial Coordinated Enrollment Period: (ICEP)

This is a seven-month period that begins three months before the month you are first eligible for Medicare Part B.

Annual Coordinated Election Period (AEP)

The Annual Coordinated Election Period runs from October15 through December 7 each year. During this time beneficiaries may change prescription drug plans, change Medicare Advantage plans, return to original Medicare, or enroll in a Medicare Advantage plan for the first time. Enrollment changes take effect on January 1.

General Enrollment Period (GEP)

Medicare beneficiaries who did not enroll in Part B when they first became eligible for Medicare may elect Part B coverage during the General Enrollment Period, which extends from January 1 through March 31 each year. Enrollment becomes effective on July 1 of the same year.

Beneficiaries who delay enrollment in Part B will be assessed a late enrollment penalty on their Part B premium. The penalty is 10% for each full year of delayed enrollment for as long as the beneficiary remains covered under Part B.

Someone who enrolls in Part B during the General Enrollment Period also has a Special Enrollment Period (SEP) for Part D. From April through June of each year a new Part B enrollee may make one election to join a Part D plan. Because beneficiaries who only have Part A and not Part B are not eligible to enroll in a Medicare Advantage plan, the SEP enables beneficiaries who elect Part B during the General Enrollment Period to enroll in a Medicare Advantage plan with drug coverage (MA-PD).

Special Enrollment Period (SEP)

Special Enrollment Periods allow beneficiaries to make an enrollment change outside of the ICEP, IEP, and AEP.

Beneficiaries who delay enrolling in Part B because they are covered by employer-sponsored health insurance as an active worker or as a dependent of an active worker are not limited to enrolling in Part B during the GEP. They have an SEP that runs for eight months from the time they (or their spouse) retire or they lose their health insurance. Part B coverage starts the month after the election is made, and no late premium penalty is assessed.

A number of SEPs exist for Medicare Advantage and PDP enrollment and disenrollment. For example, someone who moves out of a Medicare Advantage Plan or PDP service area has an SEP to enroll in a plan that serves their new home. Beneficiaries who move into, reside in, or move out of a nursing home may also have an SEP. Individuals who are eligible for Medicare and Medicaid have an SEP that allows them to change Part D drug plans at any time. CMS has the authority to create SEPs for exceptional circumstances.