Some of you may know that I am a licensed (though not currently active) insurance agent. I am licensed in Accident and Health, Life and Annuities. I want to take some time today to explain in clear language what exactly Medicare covers… and what it doesn’t.
There are four parts of Medicare.
1. Part A which is your hospital coverage
2. Part B is your doctor’s coverage
3. Part C is Medicare Advantage
4. Part D which provides some prescription coverage
Let’s go over Part A first.
Part A is your hospital coverage and this covers your basic room and board while you are in the hospital. It may also include any supplies and prescriptions you may need while you are in the hospital. Coverage includes: cost of a semi-private room, meals, regular nursing services, inpatient prescription drugs, lab tests and x-rays, use of durable medical equipment, including wheelchairs and walkers, and rehab services, such as physical or occupational therapy. Part A is free and you do not pay anything for that coverage.
Under Part A, Medicare breaks things down in to two columns. One column in the days that you are in the hospital. The other is how much you have to pay before the Medicare program begins paying.
Under Part A, Medicare says that from day 1 to day 60 while you’re in the hospital you must pay the first $1,216 (in 2014) deductible and then Medicare will pay the rest of the bill. A very interesting thing to note is that this $1,216 is NOT an annual deductible. The Medicare rule is: if you go into the hospital and are discharged and you are out of the hospital for 60 days, if you go back in, you are responsible for the $1,216 again. So theoretically, you could pay this $1,216 as many as 5 or 6 times a year. How do you feel about THAT?
Then Medicare continues. Medicare says that from day 61 to day 90, while you are in the hospital, you are responsible for the first $304 (in 2014) each and every day before Medicare starts paying.
And they continue to say that from day 91 to day 150, you are responsible for $608 (in 2014) each and every day before Medicare starts paying.
After that, beyond 150 days, Medicare says that they don’t want you any more and you are responsible for 100% of the costs. How do you feel about that?
Also covered under Medicare Part A is what’s called Skilled Nursing Care. I don’t want to mislead you into thinking that if you require Recovery Care that Medicare will pay for it, because they won’t. As a matter of fact, of all the folks receiving care today, Medicare is paying for only 4.6% of those folks, but they do pay for a small portion of Skilled Care, so let’s review it.
Just as in Part A, Medicare breaks this down into a series of days and how much you have to pay before they will begin paying. Medicare says that from day 1 to day 20, they will pay for 100% of the costs for those 20 days. From day 21 to day 100, Medicare says that you are responsible for the first $152 (in 2014) each and every day before they will begin payment. Beyond 100 days, Medicare says that you are responsible for all costs.
In addition to that, for any Skilled or Rehab Home Health Care you might require, Medicare will pay a limited amount and that varies depending upon your needs. After that, you are responsible for all costs. However, you must be homebound (in other words, there is no possible way you can get to the door) and must have a program of care set up by your doctor.
In order to qualify for this coverage from Medicare, you also have to spend three full days in the hospital, no counting the day of discharge, just to begin your qualification process, and a doctor must certify that the reason you are receiving Skilled Care is the same reason you were in the hospital. And that same doctor must also certify that your condition is improving each and every day. Once you fail to show improvement or don’t meet other criteria, you are put into Intermediate or Custodial Care.
For Intermediate or Custodial Care, the type of care that 95.4% of all people needing Long Term Care are receiving, Medicare pays for nothing and you are responsible for ALL costs. For Assisted Living, Medicare pays for nothing and you are responsible for ALL costs.
The agency you choose to provide Home Health Care must be Medicare-approved. You do not need to be admitted to the hospital first for Home Health Care. Medicare does NOT cover 24-hour full-time care. The case will be reviewed every 60 days to determine need. Medicare does not cover housekeeping, shopping, cleaning, or Custodial Care.
For Hospice Care, Medicare will cover terminally ill patients who have life expectancies of 6 months or less. This coverage includes both at-home and inpatient care. To be eligible for coverage, your doctor must certify you are terminal, you must choose Hospice Care instead of other Medicare benefits, and you must receive care from a Medicare-approved hospice program. Medicare will cover the full cost of physician and nursing services, medical appliances and supplies for up to 210 days. Hospice care is available 24/7.
For Psychiatric Hospital Care, Medicare pays for inpatient care in a Medicare-participating psychiatric hospital for up to 190 days. After that, Medicare stops.
Exclusions to Part A include:
1. Personal convenience items (phone, TV, etc.)
2. Private duty nurse
3. Custodial care in a Skilled Nursing Facility
4. Full-time nursing care
5. Prescription drugs (not in hospital)
6. Homemaker services
7. Home-delivered meals
Now for Part B, this covers your doctor’s visits, outpatient services and supplies connected to those services. Unlike Part A, Part B is not free. Part B costs $104.90 (in 2014) a month and the cost is automatically deducted from your Social Security check before you ever see it.
Medicare also breaks Part B down into 2 columns. The first is how much Medicare pays and the second is how much you pay. Medicare says that you first have to pay a $147 (in 2014) annual deductible. Unlike Part A, this IS an annual deductible and you only have to meet this once a year. After that deductible is met, Medicare will pay 80% of the bill and you are responsible for the other 20%. Pretty basic.
Covered services under Part B include:
1. Surgeon and physician fees
2. Surgical services and supplies
3. Physical and speech therapy
4. Medical lab fees
5. Diagnostic tests
6. Some outpatient psychiatric costs
Excluded from coverage under Part B:
1. Routine physical, eye and hearing exams
2. Eyeglasses and hearing aids
3. Dental care
4. Most immunizations
5. Diagnostic or therapeutic chiropractic services
6. Full-time private nursing care in home
7. Homemaker services provided by a relative
8. Most prescription drugs
Now for the last two parts of Medicare: Parts C and D. Medicare Part C is referred to as Medicare Advantage. Medicare Advantage includes: HMOs, PPOs and Private Fee For Service (PFFS) plans. These plans all differ so it‘s extremely important that you understand them. These may or may not be for you.
Also included in Medicare is Part D. Part D covers some prescription drug costs, and that coverage varies depending upon which Preferred Drug Provider you choose. Like Part B, the premium for Part D may also be deducted automatically from your Social Security check, or be included in a Medicare Advantage plan. The amount of the premium will depend on the plan you choose.
As you can see, there are many gaps in Medicare coverage. This is why it is so very, very important to make sure you compare Medicare supplements and Advantage plans and get the most comprehensive coverage you can afford.
Please SHARE this with anyone you know who is getting to that age where they will be getting on Medicare. Trust me, they will thank you for it!