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How Does Medicare Work?

If you’re an American citizen (or permanent resident who has lived in the US for 5 continuous years) who is 65 years or older, you may be eligible to sign up for Medicare. Additionally, people with certain disabilities or End Stage Renal Disease (ESRD) may be eligible for Medicare long before they turn 65.

Read through the guide below to learn how Original Medicare works.

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Original Medicare Part A and Part B Benefits

Original Medicare is composed of two parts: Medicare Part A and Medicare Part B.

Medicare Part A is Original Medicare’s hospital coverage. It covers a variety of health services, including:

  • Care received in the hospital
  • Skilled nursing facility care
  • Nursing home care
  • Hospice

Medicare Part B (Medical insurance) provides coverage for:

  • Doctor visits
  • Surgeries
  • Lab tests
  • Preventive care, which detects or prevents illness early on
  • Clinical research
  • Ambulance services
  • DME, or durable medical equipment
  • Mental health care
  • Second opinions before surgery

Out-of-Pocket Health Insurance Costs

In addition to your Medicare Part B monthly premium (the standard premium is $134 in 2018), you are typically responsible for numerous out-of-pocket Medicare costs, including:

  • Part A deductible: $1,340 per benefit period
  • Part A coinsurance
    • Day 1-60: $0 per benefit period
    • Day 61-90: $335 per day of each benefit period
    • Days 91 and beyond: $670 per each “lifetime reserve day” after day 90 for each benefit period
    • Beyond lifetime reserve days: all costs
  • Part B deductible: $183 per year
  • Part B coinsurance: 20% of Medicare-approved costs of services after deductible

Medicare Supplement Insurance Helps Cover Health Care Costs

Many Medicare beneficiaries choose to supplement their coverage with a Medigap plan, also known as Medicare Supplement Insurance. These plans help cover some of the out-of-pocket costs of Original Medicare, including some deductibles and coinsurance.

In most states, there are 10 standardized Medigap plans to choose from, labeled A, B, C, D, F, G, K, L, M and N. Each plan provides a unique mix of benefits, and plan types that share a letter have the same basic benefits, no matter where you purchase them. However, since Medigap plans are sold by private insurance companies, the price you pay can vary from state to state and from insurer to insurer.

Call us today to compare free Medigap policy quotes, to learn more about how Medicare Supplement Insurance works and to find the right plan for your unique needs. Connect with a licensed insurance agent at 1-888-264-0148.

Learn More

To learn more about Medicare and how it works, read through some of our guides below.

 

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Or chat about my options with an agent:1-888-264-0148

Resource Center

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