What Is Medicare?
Medicare is a social health insurance program that provides coverage to qualifying disabled or elderly Americans. This government program was created in 1965, and it now serves millions of people. According to the Centers for Medicare & Medicaid Services (CMMS), over 52 million people were enrolled in 2013. These individuals receive insurance coverage that helps address various healthcare costs (equipment: POC’s, CPAP’s, stationary oxygen concentrators) including hospital care, general medical expenses and prescription drug costs.
Who Qualifies for Coverage?
Medicare is not available to the general public; the government establishes specific criteria that people must meet to receive coverage. People who are over the age of 65 can qualify for coverage regardless of their personal health. For example, if you are a current oxygen users you can still qualify. Younger people who are disabled may also be eligible if they meet strict standards. Disabled individuals must collect Railroad Retirement Board (RRB) disability benefits or Social Security Disability Insurance (SSDI) benefits for at least two years to qualify for the program. The only exceptions are for people afflicted with End Stage Renal Disease and victims of amyotrophic lateral sclerosis who qualify for SSDI benefits.
Who Pays for the Program?
Various sources help finance Medicare. The government uses payroll taxes to fund the hospital insurance coverage that is offered through the program. These taxes are used to reimburse insurance companies or pay medical professionals and healthcare facilities that have provided care to covered patients. Medical insurance and prescription drug coverage are primarily paid for through the premiums, deductibles and copays that people enrolled in the program pay.
What Coverage Is Available?
Medicare provides three primary types of insurance coverage, which are described below. Patients who qualify for this program also are eligible for enrollment in private insurance plans that consolidate these three areas of coverage. One area of coverage is generally offered free of charge, while the other areas require patients to pay premiums. Enrollment in the plans that require payments is voluntary.
Part A: Hospital Insurance
The first area of Medicare coverage, Part A coverage, helps pay for various forms of healthcare. The expenses covered under this insurance, which is also known as Hospital Insurance, can be divided into the following categories:
- Inpatient procedures and hospital stays. Part A may cover diagnostic and clinical tests, oxygen tests, medical supplies, hospital meals and the cost of a room.
- Skilled assisted care. Care in a nursing facility or at home may be covered. This can include part-time but necessary care, such as physical therapy, speech therapy or occupational therapy.
- Approved medical equipment. The cost of equipment such as CPAP’s, wheelchairs, portable oxygen concentrators, oxygen tanks may also be covered under Part A.
The government typically provides this coverage free of charge to eligible adults. However, people who did not pay Medicare taxes while working may have to pay a premium to secure coverage.
Part B: Medical Insurance
Medicare Part B, which is also known as Supplementary Medical Insurance, is a form of coverage that patients can enroll in. Patients must pay monthly premiums, and coverage only kicks in once patients have paid the annual deductible. This coverage addresses certain outpatient and home healthcare costs, along with physician visits that are made out of medical necessity.
Part B helps cover the expenses associated with several specific treatments or procedures. These include medical testing, x-rays, transfusions, chemotherapy, outpatient procedures, renal dialysis and the use of immunosuppressant medications after organ transplants. Part B also helps address the cost of eyeglasses, prosthetic devices and medical equipment that is designed for long-term use, such as a POC’s or oxygen tanks. Additionally, Part B may provide coverage for hormonal treatments, vaccinations and ambulance transportation, but this coverage isn’t guaranteed.
Part D: Prescription Coverage
Medicare Part D, which is a relatively new addition to the program, is not offered through the government. Instead, patients who wish to receive prescription drug coverage purchase Part D plans through private insurers. These plans and the companies that provide them are approved and monitored by the CMMS. Patients can choose from various plans, which cover different drugs and feature different price points. Some plans combine Part B and Part D coverage, while others exclusively offer Part D coverage.
Anyone who qualifies for Part A or Part B coverage may opt in to receive Part D coverage. Like Part B, this coverage requires patients to pay premiums and reach an annual deductible before coverage begins. Additionally, certain prescriptions may require copays. Elderly adults who have lower income may qualify for government assistance with these costs.
Like prescription drug coverage, Medicare Advantage, or Part C coverage, is an insurance plan that is approved by the CMSS and administered through private insurance companies. Standard Part C coverage typically helps address the same costs as Part A and Part B coverage. During enrollment, patients also can choose to add in Part D prescription coverage.
Medicare Advantage is designed to allow patients to bundle all of their health insurance coverage into one policy. As a result, this insurance can address various services that Medicare would not normally cover, such as dental care. Patients pay extra fees for all of the services that are not covered under Part A.
Medicare and Medicaid
Some people who qualify for Medicare are also eligible for Medicaid, which is another government program that helps address healthcare costs. Elderly adults and disabled individuals who have limited income may qualify for both types of coverage. Medicaid can address some of the same costs as Medicare, and it also covers long-term services, such as institutional care. People who quality for both programs and enroll in Medicare Part D automatically receive assistance paying for their Part D coverage.
The Enrollment Process
Although some people receive Medicare benefits automatically, most people must apply for coverage. Disabled individuals who receive SSDI or RRB benefits are automatically enrolled in the program once they have received benefits for enough time. However, adults who are over the age of 65 and people with End Stage Renal Disease must apply for coverage.
Prior to Medicare enrollment, it is advisable for patients to fully understand the coverage that is available through this government program. Patients should then assess their current coverage, their medical needs (will you need a portable oxygen concentrator and a stationary oxygen concentrator) and likely future changes to both. This should make it easier for patients to identify the type of plan that will offer full protection without any unnecessary extra coverage.