Medicare is the federal health insurance program for people who are 65 or older, have kidney disease or certain disabilities. Sounds simple, but it can get confusing when people start discussing the different parts of Medicare – A, B, C and D. We’re going to define the different parts of Medicare, plan by plan and explain what each does and how each works.
Medicare Part A: Hospital insurance
When you sign up for Medicare, you are automatically enrolled in Part A. Most people do not pay a monthly premium for Part A. The cost is covered if you or your spouse paid Medicare taxes while working.
Part A helps with costs of:
- Inpatient hospital care
- Home health care
- Hospice care
- Shared hospital room
- Skilled nursing facility care
Medicare Part B: Medical insurance
If you sign up for Part B, the monthly premium is automatically deducted from your Social Security check. If you do not receive Social Security, you are billed for the cost. Some people pay more or less for their premiums based on income.
Part B helps cover:
- Doctor visits
- Outpatient procedures that don’t require an overnight hospital stay
- Lab work and pathology testing
- Some preventive care services
Part C is also known as Medicare Advantage. Medicare Advantage plans are offered by private insurance companies that contract with Medicare. By law, they must provide coverage that is equivalent to regular Part A and Part B coverage and they may include Part D, prescription drug coverage. Put simply, Medicare Advantage plans combine Medicare Parts A, B, and often D into one convenient policy.
Also, most Medicare Advantage plans provide benefits beyond what Parts A and B cover, such as a hearing, dental, and vision benefits. You can compare Medicare Advantage plans on the federal Medicare website.
Medicare Part D: Prescription drug coverage
Part D helps cover the . Medicare Part D plans are run by private companies approved by Medicare. The monthly premium varies depending on which plan you have. Each company offering Part D coverage has its own list of covered drugs called a formulary.
As you consider your plan options, you will want to consider coverage needs and your out-of-pocket costs, which includes your monthly premium, the deductible, copayments, and coinsurance.
Other things to consider:
- Is the doctor you see in the plan’s network?
- Are the drugs you take on the plan’s formulary?
- Is the plan available in my area?
- What extras does the plan offer for things such as eye and dental care, hearing aids and eyewear, and wellness programs?
The official U.S. Government Medicare handbook: “Medicare and You” is also a great resource for learning about the different parts or Medicare. A copy of this brochure is available at http://www.medicare.gov or by calling 1-800-MEDICARE.
Have more questions on Medicare and how to determine what plans are right for you? Visit Health Insurance Central to learn more, ask questions and see answers.