Medicare Coverage

For most Americans, Medicare is on the distance horizon. But as you approach retirement age, knowing about medicare and what it can or cannot do for you could be very important to you physical and financial well-being.

You will be automatically enrolled in the program if you're already collecting Social Security or receiving benefits from the Railroad Retirement Board when you turn 65 - or if you 'vs beeen collecting disability for more than two years. But if you're working and not collecting government pension benefits, you need to sign up three months before your 65th birthday.

Medicare program isn't exactly "free" government-sponsored health care. You'll have to pay dedectibles and copayments out-of-pocket, and certain services aren't covered at all.

What you'll ultimately pay for your future medical care will depend on the type of Medicare plan you choose, whether you'll have additonal health insurance coverage from a former employer or you've puchased "supplemental coverage", and how often you make use of the medicare services offered by your doctors or hospitals.


Medicare ABC's

You have several options, and they're not cut-and-dry. Here's what you need to know to make inteliigent decisions about your insurance coverages. Let's start with the basics. You can choose between two (02) ways of receiving your Medicare benefits:

1. The Original Medicare (Part A & B) with options for additional insurance such as Part D and Medicare Supplemental insurance (Medigap)


2. Medicare Advantage Plans (Part C) that combines your benefits.

The Original Medicare Plan : Part A & B

The original medicare plan is designed to help pay for certain medical services and supplies providedin hospitals, doctors' offices and other health care settings. All citizens and legal residents of the United States who have paid Medicare payroll taxes for a minimum of 10 years will be eligible for Part A and Part B coverage upon reaching age 65.

You usually don't pay a monthly premium for Part A coverage if you (or your spouse) paid medicare taxes while working at least 40 calendar quarters. But if you aren't eligible for premium -free Part A coverage - meaning you have worked fewer than 40 calendar quarters - you may be able to buy Part A coverage if you meet a certain conditions.

Those enrolled in Part B have to pay a monthly Part B premium and an annual deductible. Most plan participants will pay the standard monthly premium amount, which is $96.40 in 2009 (normally deducted from your monthly Social Security checks). The monthly premium amount, however, will be higher for people above certain income thresholds. Financial hardship cases can get this premium covered with governmental help.

• Part A - basically helps people better absorb the costs associated with inpatient care in hospitals (including inpatient rehabilitation facilities) inpatient stays ina skilled nursing facility (but not custodial or long-term care), inpatient mental health in a psychiatric hospital (limited to 190 days ina lifetime), as well as hospice are services and home health care services. Some of the costs associated with these services and procedures will be covered completely by Medicare Part A. Others will required out-of-pocket co-payments or the satisfaction of annual deductibles.

• Part B - coverage helps pay for "medically necessary" services such as doctor's services, outpatient care and other medical services not covered by Part A. Part B also helps pay for some preventive care services that are designed to prevent or detect illness at an early stage, when treatment is likely to work best. Part B has its own separate annual deductible-$135.00 for 2009 - as well as its own co-payment and co-insutrance costs. General speaking, Medicare will pay about 80% of the expenses for part B-covered services and supplies.

"You need to be aware of that fact that you will spend money out-of-pocket, either for the cost sharing un der medicare, or for the cost of supplemental insurance if you don't have that through an employer or if your income isn't low enough to qualify for additional assistance through Medicaid (Medical in California). And it's important to remember that Medicare doesn't have any annual out-of-pocket limits."

• Medicare Part D: Prescription Drug Benefit - Medicare offers prescription drug coverage for everyone with Medicare under Part D. But to get Medicare drug coverage, you must take the initiative and join a medicare drug program. Medicare drug plans are run by insurance companies and other private companies approved by medicare. Each plan varies in cost and drug covered. Even if you don't take a lot of prescription drug now, you should still consider joining a medicare drug plan because , if you decide not to join such a plan when you are first eligible, you will pay a late-enrollment penalty if choose to join later. The penalty is one percent (1%) of the monthly premium for each month you don't enroll and it's applied to all future month premiums. There are 2 ways to get Medicare Part D coverage:

1) Stand-alone Mdicare Part D Plan: Enrolling these plans, sometimes called PDPs, add drug coverage to the original Medicare plan and to some medicare Private Fee-For-Service (PFFS) plans.

2) Join Medicare Advantage Plan (such as an HMO, PPO, or SNP). Through these you will get all your medicare coverage (part A & B), including Part D. These plans are sometimes called "MA-PD" and you will usually pay a separate monthly premium (if any) in addition to your Part B premium.