This article aims to provide you What Is Medicare, and What Does It Cover? with all the information you need about Medicare basics, including coverage, costs, enrollment, and more. Americans with chronic health conditions and disabilities may qualify for Medicare, a government-funded health insurance program. The type of coverage each Medicare plan can provide you varies, so it’s important to understand your options.
What Is Medicare?
The Medicare program is a U.S. government health insurance program. Those 65 and older, those with disabilities, and those with end-stage renal disease are covered under the plan.
Several Medicare plans cover specific healthcare aspects, and some have a cost associated with them. More choices in terms of costs and coverage allow the program to offer more options to participants, but it also adds complexity to the enrollment process.
Is Medicare Free?
The Federal Insurance Contributions Act (FICA) provides a free Medicare Part A premium for most individuals based on past payroll tax payments. Individuals can qualify for free Medicare Part A if their spouse has a work history. A premium is required for those not eligible for Medicare Part A. For other components of Medicare, a premium is required as well.
How Does Medicare Work?
Medicare is an American government-funded health insurance program. To provide coverage for people without health insurance age 65 and over, Congress amended the Social Security Act in 1965.
Medicare now covers people older than 65 with disabilities and those with amyotrophic lateral sclerosis (ALS), also known as Lou Gehrig’s disease. The Centers for Medicare and Medicaid Services (CMS) administer the program. There are four components to Medicare, each covering a different aspect of healthcare:
- Medicare Part A covers hospital, skilled nursing, and hospice care.
- The Medicare Part B plan covers doctor’s visits, outpatient care, home health care, and durable medical equipment. Screenings for prevention and early detection.
- Part C of Medicare describes Medicare-approved plans offered by private companies to cover Medicare Part A, Part B, and typically Part D coverage.
- The Medicare Part D program covers prescription drugs.
Eligibility Criteria for Medicare
It is common for people to begin enrolling in original Medicare three months before they turn 65. Medicare coverage may be available at any age in some circumstances, however. The following exceptions apply:
You will be eligible for Medicare after 24 months if you receive disability benefits through the Social Security Administration or Railroad Retirement Board (RRB).
Amyotrophic lateral sclerosis (ALS)
The first month after developing ALS, you will be eligible for Medicare benefits if you receive Social Security or RRB benefits.
End-stage renal disease (ESRD)
The Medicare program is automatically available to those with ESRD.
Medicare Advantage plans are available to eligible Americans once enrolled in Medicare parts A and B.
How Do I Enroll in Medicare?
Medicare Part B and Part A are automatically included in your Social Security benefits when you reach 65 if you qualify for Social Security benefits. Taking Advantage of these programs does not require any action on your part.
The Medicare program requires enrollment in other parts, however.
The enrollment process for Medicare Part D prescription drug coverage is entirely on your own. You can apply for Social Security benefits through the SSA website if you still need to receive them. It is best to do this around your 65th birthday, within seven months. Three months before your 65th birthday, three months after your 65th birthday, and three months after your 65th birthday is included in this window. You may incur a penalty if you miss this deadline.
It is also necessary for you to enroll yourself in Medicare Supplement Insurance (Medigap). You can enroll in this plan during the six-month open enrollment period starting the month after you turn 65. Private insurers must offer Medigap coverage if you sign up during this period. You cannot be guaranteed a Medigap policy if you do not ask.
The Medicare open enrollment period is repeated annually if you miss the initial enrollment period or wish to change plans later.
What Does Medicare Pay for?
The four types of Medicare programs mentioned above can be accessed by individuals in various ways. The Medicare Part C plan is available only to those with Medicare Part A and B coverage. Medicare Part D is also available to individuals.
What Does Medicare Part A Cover?
Medicare Part A pays for hospitalization, skilled nursing facilities, hospice care, and home-based care. It does not cover long-term or custodial care, however. Social Security benefits recipients are automatically covered. Enrollment can be done through the SSA website for those who do not receive benefits.
What Does Medicare Part B Cover?
Outpatient care, such as doctor visits, is generally covered by Medicare Part B. As part of Part B, you will also receive preventive services, ambulance transportation, certain medical equipment, and mental health care. This plan also covers some prescription drugs.
A standard monthly premium of $164.90 is expected for Medicare Part B enrollees for 2023, down from $170.10 in 2022. It is $226 for 2023, a decrease from $233 for 2022.
The premiums are higher for taxpayers whose modified adjusted gross income (MAGI) exceeds limits adjusted annually. Single taxpayers filing jointly and married couples filing separately are expected to have MAGIs of $97,000 and $194,000, respectively, in 2023. Those figures are up from $91,000 to $182,000 based on the 2020 MAGI.
What Is Medicare Part C?
Medicare Part C, also known as Medicare Advantage, is available to individuals with Medicare Parts A and B. Medicare Advantage plans are purchased by consumers from private insurers rather than from Medicare. The coverage these plans provide must be equivalent to that of Original Medicare (Parts A and B).
There are many Medicare Advantage plans that offer annual caps on out-of-pocket costs. Original Medicare patients must purchase additional insurance, such as a Medigap plan to receive these benefits, including copays, deductibles, and travel coverage outside the country. In addition to providing dental, vision, and hearing coverage, some Medicare Advantage plans also offer vision coverage. The basic Medicare program does not cover hearing aids, although Medicare Advantage plans may cover them as supplemental benefits.
What Is Medicare Part D?
The Medicare Part D program offers supplemental prescription drug coverage. Medicare Part A and Part B participants may enroll in Part D to receive subsidies for prescription drug costs not covered by Original Medicare.
What’s the difference between Medicare and Medicaid?
The Medicare program provides health insurance to seniors and those with disabilities and conditions that the government covers. The Medicaid program provides health insurance to low-income Americans who qualify.
You can qualify for both Medicare and Medicaid. Then Medicare would be your primary insurance coverage, and Medicaid would be your secondary coverage to cover any costs and services not covered by Medicare.
Each state determines the eligibility criteria for Medicaid, and it is as follows:
- Family status
- Household size
- Yearly gross income
- Disability status
Contact or visit your local social services office to determine if you qualify for Medicaid coverage.
Who Runs Medicare and Medicaid?
The federal government administers Medicare. Medicaid programs are run by states independently. Medicaid programs differ from state to state, so Medicare is the same everywhere.
The federal government’s Centers for Medicare and Medicaid Services administer the Medicare program. As part of its responsibilities, it oversees all Medicaid programs nationwide to ensure they meet federal minimum standards.
The federal government sets standards for Medicaid programs so all can receive federal funds (Medicaid is jointly funded by the state and federal governments, with matching rates varying by state). The federal government must approve waivers before states change their Medicaid programs significantly.
How do the Programs Differ?
Medicaid is a social welfare program, whereas Medicare is an insurance plan. Those eligible for Medicare pay for it through payroll taxes while working and pay monthly premiums once they become eligible.
Medicaid recipients don’t need to pay taxes or premiums; however, some states require them to pay a small amount if they fall below a certain income threshold.
Taxpayers fund the Medicaid program similarly to other social welfare programs such as Temporary Assistance for Needy Families, Women, Infants, and Children, and Supplemental Nutrition Assistance Program.
Is Medicare Insurance?
Medicare covers the healthcare costs for eligible individuals in the same way as those covered by health insurance. Unlike private health insurance, Medicare has limited coverage, but there is no premium for the basic part. Dependents, such as spouses and children, can usually be covered by private health insurance. In contrast, Medicare participants must be elderly or disabled to qualify.
Does Medicare cover dental and eye care?
Some dental services that original Medicare does not cover include cleanings, fillings, teeth extractions, dentures, plates, and other dental equipment. When you’re in a hospital and need dental services for another surgery or procedure, Medicare Part A (hospital insurance) covers them. Eyeglasses and contact lenses aren’t covered by Medicare either.
A portion of vision, dental, and hearing coverage is included in some Medicare Advantage Plans (Medicare Part C). Use Medicare’s plan-finding tool to locate plans that cover your area.
Who qualifies for Medicare?
Typically, Medicare is available to people 65 and older, to people with disabilities who qualify for Social Security disability insurance, or to those with end-stage renal disease (permanent kidney failure requiring dialysis or transplantation) or ALS.
The Medicare program is a U.S. government health insurance program that subsidizes healthcare costs. The plan can only cover a person who is 65 or older and meets certain eligibility criteria. A person cannot be covered if they are younger than 65. The cost of hospital care and doctor visits will be covered by Medicare Part A as long as you qualify for Social Security benefits when you turn 65. Once you are eligible, you may enroll in other parts of Medicare.