Medicare is a health-insurance programme for persons over the age of 65 in the United States. People under the age of 65, such as those with disabilities or those who have irreversible renal failure, may be eligible for Medicare.
The programme assists with health-care costs, although it does not cover all medical bills or most long-term care costs.
You can receive Medicare coverage in a variety of ways. You can purchase a Medicare Supplement Insurance (Medigap) policy from a private insurance provider if you opt to have Original Medicare (Part A and Part B) coverage. Medicare is broken down into numerous plans that cover a wide range of healthcare needs, some of which are paid for by the covered person.
While this allows the programme to provide consumers with more cost and coverage options, it also adds to the program’s complexity for those looking to enrol.
At the age of 62, you can only enrol in Medicare if you match one of the following criteria:
For at least two years, you’ve been receiving Social Security Disability Insurance (SSDI).
Because you have amyotrophic lateral sclerosis, also known as ALS or Lou Gehrig’s disease, you are on SSDI. (In this situation, the two-year requirement is lifted.)
End-stage renal disease is something you have.
Otherwise, your initial Medicare enrollment period begins three months before your 65th birthday month. If you turn 65 on July 4, 2022, for example, the registration period begins on April 1.
If you receive Social Security payments, the Social Security Administration, which is in charge of Medicare enrollment, will mail you an information package as well as your Medicare card at the start of the registration period. In the month you turn 65, you’ll be automatically enrolled in Medicare Part A (hospitalisation) and Part B (regular health insurance).
In the interim, check into other health insurance choices to fill the gap until you become Medicare-eligible. Medicaid, private insurance through the Affordable Care Act marketplace, or coverage through a spouse’s employer plan are all options depending on your financial and marital situation.
Keep in mind that if you are not on Social Security when you turn 65, you will have to sign up for Medicare on your own. You can do so by going online, calling 800-772-1213, or going to your nearest Social Security office.
Due to the COVID-19 outbreak, local Social Security offices are presently closed to walk-in visitors. Many Social Security services can be accessed online or over the phone.
You may be able to schedule an in-person session if you have a “dire need scenario” with your benefits or need to alter information associated with your Social Security number, such as your name or citizenship status.
For further information, go to Social Security’s coronavirus page or call your local office.
What is Medicare?
Medicare is a United States national health insurance program that was established in 1965 by the Social Security Administration (SSA) and is now administered by the Centres for Medicare and Medicaid Services (CMS).
It mostly covers Americans aged 65 and above, although it also covers some younger persons with disabilities as established by the Social Security Administration, such as those with end-stage renal illness and amyotrophic lateral sclerosis (ALS or Lou Gehrig’s disease).
According to the 2019 Medicare Trustees Report, Medicare provided health insurance to over 59.9 million people in 2018, including more than 52 million seniors and over 8 million younger people.
Medicare covers nearly half of individuals enrolled in healthcare spending, according to annual Medicare Trustees reports and study by the government’s MedPAC committee.
Beneficiaries face other healthcare-related costs regardless of which of those two options they choose—or if they choose to do nothing extra (about 1% according to yearly Medicare Trustees reports over time).
Deductibles and copays
Deductibles and copays; the costs of uncovered services—such as long-term custodial, dental, hearing, and vision care; the cost of annual physical exams (for those not on Part C health plans that include physicals); and the costs associated with basic Medicare’s lifetime and per-incident limits are all examples of additional so-called out of pocket (OOP) costs.
Medicare is funded through a combination of a particular payroll tax, beneficiary premiums and surtaxes, co-pays and deductibles, as well as general Treasury revenue.
A, B, C, and D are the four parts of Medicare.
Part A includes inpatient (officially admitted only) hospital, skilled nursing (only after being formally admitted to a hospital for three days and not for custodial care), and hospice services.
Outpatient services and parts of Medicare
Outpatient services, including some providers’ services while inpatient at a hospital, outpatient hospital expenses, most provider office visits even if the office is “in a hospital,” and most professionally administered prescription medications, are covered by Part B.
Part C, also known as Managed Medicare or Medicare Advantage, allows patients to choose from a variety of health plans that include at least the same service coverage as Parts A and B (and often more), often the benefits of Part D, and always an annual out-of-pocket expense limit that Parts A and B lack. Before enrolling in Part C, a beneficiary must first enrol in Parts A and B.
Part D mostly covers self-administered prescription medications.
Medicare is available to everyone 65 or older who has lived in the United States for at least five years and has been a lawful resident for at least five years. People under the age of 65 who receive Social Security Disability Insurance (SSDI) benefits may also be eligible.
Specific medical issues may also make it easier for people to qualify for Medicare.
If the following circumstances apply, people are eligible for Medicare coverage and their Medicare Part A premiums are completely waived:
They are 65 years old or older, US citizens or permanent legal residents for the previous five years, and they or their spouses (or qualifying ex-spouses) have paid Medicare taxes for the previous ten years.
They must receive one of these benefits for at least 24 months from the date of entitlement (eligibility for first disability payment) before becoming eligible to enrol in Medicare.
They are under 65, disabled, and have been receiving either Social Security SSDI benefits or Railroad Retirement Board disability benefits; they must receive one of these benefits for at least 24 months from the date of entitlement (eligibility for first disability payment) before becoming eligible to enrol in Medicare.
End-stage renal illness necessitates ongoing dialysis or a kidney transplant.
If they or their spouse have not paid the qualifying Medicare payroll taxes, those 65 and older who wish to participate in Part A Medicare must pay a monthly premium to stay enrolled in Part A Medicare.
People with impairments who receive SSDI remain eligible for Medicare as long as they continue to receive SSDI payments; but, if they cease receiving SSDI, they lose their disability-based Medicare eligibility.
The coverage does not begin for another 24 months after the SSDI application is approved. The 24-month exclusion means that unless they have one of the conditions specified, persons who become incapacitated must wait two years before receiving government medical insurance.
The 24-month period begins on the date that an individual is judged to be eligible for SSDI benefits, not on the date that the first payment is made. Many new SSDI users receive “back” disability pay, which covers a six-month period between the start of disability and the first monthly SSDI payment.
Some people are qualified for both benefits.
As a result, they are eligible for both Medicare and Medicaid. In some areas, Medicaid will cover the beneficiaries’ Part B premium (most beneficiaries have worked long enough and have no Part A cost), as well as some of their out-of-pocket medical and hospital expenses if they earn less than a specific amount.
Medicare’s benefits and parts
There are four parts to Medicare: Part A is, in a nutshell, hospital insurance. Medical Services Insurance is covered under Part B. Many prescription medications are covered by Medicare Part D, however some are covered by Medicare Part B. The distinction is made in general depending on whether or not the medicines are self-administered, however this is not a complete distinction.
Part C Medicare health plans, the most popular of which are branded Medicare Advantage, are an additional means for Original Medicare (Part A and B) members to get their Part A, B, and D benefits; simply put, Part C is a capitated fee while Original Medicare is a fee for service. Medical necessity is required for all Medicare benefits.
Parts A and B were included in the original programme. Part-C-like plans have existed under Medicare as demonstration projects since the early 1970s, but the Part was formally established by legislation in 1997.
Part D was enacted in 2003 and went into effect on January 1, 2006. Previously, private insurance or a public Part C plan might provide coverage for self-administered prescription medications (if wanted) (or by one of its predecessor demonstration plans before enactment).
CMS began mailing new Medicare cards with new ID numbers to all enrollees in April 2018. Previously, ID numbers on cards contained recipients’ Social Security numbers; now, ID numbers are produced at random and are not linked to any other personally identifiable information.
Part A: Insurance for hospitals and hospices
Part A covers inpatient hospital stays, including semi-private rooms, food, and diagnostics, where the beneficiary has been legally admitted to the hospital.
Medicare Part A had a $1408 inpatient hospital deductible, a $352 coinsurance per day after 61 days of confinement within one “spell of sickness,” and a $704 per day coinsurance for “lifetime reserve days” (basically, days 91–150 of one or more stays of more than 60 days) as of January 1, 2020.
In a Skilled Nursing Facility (after a medically required hospital stay of three nights or more), the coinsurance structure is different: $0 for days 1–20; $167.50 per day for days 21–100.
Part B covers several medical services that are covered under Part A (e.g., some surgery in an acute care hospital, some physical therapy in a skilled nursing facility).On the first day of each year, these coverage amounts rise or decrease.
Part B: Medical Protection
Part B medical insurance helps pay for some outpatient services and items that aren’t covered by Part A. (but can also apply to acute care settings per physician designated observation status at a hospital).
Part B is a choice. If the beneficiary or his or her spouse is still employed and receives group health care through that employer, it is frequently deferred. If you don’t enrol in Part B when you’re first eligible, you’ll face a lifetime penalty of 10% of your premium.
After a patient reaches his or her deductible ($183 in 2017), Medicare normally covers 80% of the RUC-set rate for approved services, with the remaining 20% being the patient’s burden, either directly or indirectly through private group retiree or Medigap insurance.
Preventive therapies such as yearly mammography screenings, osteoporosis testing, and many other preventive screenings are covered completely under Part B.
Medicare Advantage Plans (Part C)
The Balanced Budget Act of 1997 gave Medicare recipients the option of receiving their Original Medicare benefits through capitated health insurance Part C health plans rather than the original fee-for-service Medicare payment system. Many people have previously had that opportunity thanks to a series of demonstration projects that began in the early 1970s.
In 1997, these Part C plans were known as “Medicare+Choice.” Most “Medicare+Choice” plans were renamed “Medicare Advantage” (MA) plans after the Medicare Modernization Act of 2003. (though MA is a government term and might not even be “visible” to the Part C health plan beneficiary).
In some places of the country, other plan types, such as 1876 Cost plans, are also available. Cost plans are not Medicare Advantage or capitated plans.
Beneficiaries keep their Original Medicare benefits while their Part A and Part B benefits are administered by their sponsor. An integrated health delivery system or spin-off, a union, a religious institution, an insurance business, or another form of organisation could be the sponsor of a Part C plan.
Prescription drug plans (Part D)
Part D of Medicare became effective on January 1, 2006. Part D, which covers largely self-administered medications, is available to everyone who has Part A or B. The passage of the Medicare Modernization Act in 2003 made it possible.
A person with Medicare must participate in either a stand-alone Prescription Drug Plan (PDP) or a public Part C health plan with integrated prescription drug coverage to access this benefit (MA-PD).
The Medicare programme approves and regulates these plans, but they are actually designed and administered by a variety of sponsors, including charities, integrated health delivery systems, unions, and health insurance companies; almost all of these sponsors, in turn, use pharmacy benefit managers in the same way that sponsors of non-Medicare health insurance do.
Part D coverage is not standardised, unlike Original Medicare (Parts A and B) (though it is highly regulated by the Centers for Medicare and Medicaid Services).
Plans pick and choose which drugs to cover (but must cover at least two drugs in 148 different categories and cover all or “substantially all” drugs in the following protected classes of drugs: anti-cancer; antipsychotic; anti-convulsant, antidepressants, immuno-suppressant, and HIV and AIDS drugs). With CMS approval, plans can also indicate at what level (or tier) they want to cover it, and step treatment is encouraged.
Some pharmaceuticals are completely barred from coverage, and Part D plans that cover them are not authorised to pass those costs on to Medicare, and they must repay CMS if they are found to have invoiced Medicare in these instances.
Is it mandatory to sign up for Medicare at age 65?
If you have a group health plan and work for a firm with 20 or more employees, Medicare will not force you to enrol at the age of 65. You will be given a special enrollment period to join later if you have a group health plan and work for an employer with 20 or more employees.
When I reach the age of 65, do I automatically become eligible for Medicare?
Some people are automatically enrolled in Medicare at the age of 65, but as the Medicare and Social Security ages have drifted apart, this number has decreased.
The majority of people who are automatically enrolled in Medicare at 65 had been receiving Social Security benefits for at least four months prior to turning 65. Medicare premiums are traditionally withheld from your Social Security payment. For a long time, you could retire at 65 and start receiving full Social Security benefits while still enrolling in Medicare.
If you’re drawing Social Security, you’ll still be automatically enrolled in Medicare Parts A and B at 65, but due to changes in the qualifying age for full Social Security payments, fewer people are drawing Social Security at that age these days.
The majority of senior citizens are familiar with Medicare and the age of eligibility, which is 65. Part A and Part B of Medicare are available based on your age or, in some situations, your health condition, such as:
- 65 years old or older
- End-Stage Renal Disease Disabled (ESRD)
- Medicare is available to those under the age of 65 who have been receiving Social Security or Railroad Retirement Board payments for at least 24 months.
Even yet, the majority of recipients join in Medicare when they reach the age of 65.