Medicare is a federal health insurance program for people age 65 or older or those with disabilities who qualify.
There are four parts to Original Medicare:
Part A:Original Medicare’s Hospital Coverage
Under Original Medicare’s Part A benefits, you are responsible for paying deductibles and coinsurance for your hospital care. For instance, in 2012, you must pay a deductible of $1,156 when you are admitted to a hospital before your Medicare coverage kicks in. If your hospital admission extends 60 days you must pay an additional $289 per day for days 61-90 and $578 per day if your admission lasts for 91-150 days. These expenses are often why individuals choose a Medicare Advantage plan, like MediGold, over Original Medicare. It saves money.
Part B:Original Medicare’s Medical Coverage
Original Medicare’s Part B benefits cover services like doctor office visits, outpatient surgery and home health care. With Part B, you must also pay deductibles and coinsurance. In most cases, Original Medicare covers 80% of approved services after you meet the yearly $140 (2012) deductible.
Part C:Private Medicare Insurance Options (such as MediGold)
Medicare Advantage plans, like MediGold, automatically include Medicare Parts A and B. Medicare Advantage plans are contracted with Medicare. They receive a subsidy from the Centers for Medicare and Medicaid Services (CMS) to provide alternative coverage to Medicare beneficiaries. These plans replace your Original Medicare coverage. They cover everything Medicare does and more. You do not lose your Medicare coverage when joining such a plan. You simply receive your benefits from a private company. Even when joining such a plan, you can return to Original Medicare in the future if you determine it is not the right coverage for you. Such plans not only provide improved benefits over Original Medicare, but they often help individuals to save money over traditional Medicare Supplements. When you join a Medicare Advantage plan, like MediGold, you must pay your monthly Medicare Part B premium (which is typically deducted from your Social Security check) in addition to your monthly plan premium.
Part D:Original Medicare’s Prescription Drug Coverage
To help Medicare beneficiaries with rising drug costs, CMS added Part D. This part of Medicare was designed to help with your drug expenses. They often include benefits and simple copays for both generic and brand name medications. Many Medicare Advantage programs, like MediGold, offer plans that automatically include hospital, medical and Part D coverage. It’s everything you need in one easy plan.
In addition to Original Medicare and Medicare Advantage plans, there are “Medicare Supplements” or "Medi-Gap" policies. These policies fill the gaps left by Original Medicare coverage, but they do not include Part D drug benefits. Monthly premiums for these options are generally higher than Medicare Advantage plans and may be affected by your age and health status. Medicare Supplements may not be the best option for cost-conscious individuals or those who need drug benefits.
Last Updated 10/25/2012 9:33:00 AM