Medicare is a federal medical insurance program. It was founded in 1965 and was designated primarily for people over the age of 65. In 1972, it was expanded to cover younger people with specific disabilities and people with ESRD (End-Stage Renal Disease).
The parts of Medicare (A, B, C, D)
Medicare is divided into four categories, namely:
Things covered under part A include hospice care, inpatient hospital stays, home health care, and skilled nursing facility care. In 2019, Part A beneficiaries were subject to a $1,364 deductible per benefit period. Beneficiaries also require coinsurance for extended skilled nursing facility stays and inpatient hospital stays.
Some of the costs covered under part B include outpatient care, preventive services, and certain doctors’ services. In 2019, part B beneficiaries were subject to a $185 deductible and coinsurance of up to 20%.
However, beneficiaries are not subject to deductibles or coinsurance for preventive and annual wellness visits.
Part C (advantage program)
Part C is a medicare advantage program as stated on ClearMatch Medicare. Cle. It allows beneficiaries to enroll in a private health plan such as a preferred provider organization (PPO) or a health maintenance organization (HMO).
Beneficiaries enrolled in plan C receive part A, B, and, in some cases, Part D medicare-covered benefits.
Part D (prescription drug coverage)
Part D helps cover the cost of prescription medications, including any recommended vaccines or shots. Plan D beneficiaries are expected to pay cost-sharing and monthly premiums for prescriptions.
However, beneficiaries with moderate assets and low incomes get additional financial assistance.
How does Medicare Work?
Any US citizen over the age of 65 or a permanent US resident for over five years is eligible for the medical insurance cover. You can also receive benefits if you have any disability or suffer from ESRD, regardless of your age or income.
Once you turn 65, you can enroll in the original program (part A and part B). If you want a more inclusive plan, you can also enroll in an advantage plan through a private medical insurance provider.
You can enroll three months before you turn 65, on your birthday month, and three months after your birthday. So, you have about seven months to sign up.
Younger people can sign up if they have any disability or suffer from end-stage renal disease or other chronic diseases.
The Open Annual Enrolment Program
The federal medical insurance program offers an annual enrolment period that runs from 15th October to 7th December each year. During this period, you can make any changes to your yearly coverage plan.
For example, if you originally signed up for the original plan, you can switch to the Advantage plan or vice versa.
Signing up for Medigap (Medicare Supplement Insurance Policy)
All American citizens over the age of 65 who had already signed up for the original plan are eligible for a supplement plan. Medigap is not part of the federal insurance program. It is, therefore, sold exclusively through private insurance providers.
Medigap has an open enrolment period that spans six months. You can buy any supplement insurance policy sold in your state during this time, regardless of any pre-existing medical conditions. You are eligible to receive full benefits of the plan as long as you meet these criteria;
- l You are 65 years or older
- l You are already enrolled in part B
You can also enroll for a supplement insurance policy at any time of the year, but it comes with a few limitations.
For starters, you may be subject to restrictions based on your current medical conditions or previous health history. In some cases, you may also be denied acceptance.
Advantages of Medicare
1. Low Monthly Costs
Anyone over the age of 65 automatically qualifies for a free plan A. You are, however, required to pay a small out-of-pocket fee for plan B. This will cost you around $135.50 per month.
When you compare this fee to the out-of-pocket costs like operations and prescriptions you would have incurred without the plan, your cost savings are enormous.
2. It has resulted in an increased level of medical standards.
The creation of the program prompted congress to create a set of standards for hospital enrolment. Over the past decades, the government has become more involved in ensuring the implementation of these standards.
The government now requires hospitals to prepare a public report on things such as re-admissions and infection rates. The increased level of accountability prompts hospitals to perform better in ways that they wouldn’t have before the program was created.
3. It has led to Prescription Innovations.
Since the program was rolled out, it has created a big market for drug companies. It gave millions of Americans access to prescription medications they wouldn’t have had otherwise.
Drug companies began investing billions in drugs tailored to particular conditions affecting seniors and the disabled, seeing this untapped potential.
Gaps in Medi -healthcare Coverage
Although it provides financial cushioning against the costs of many healthcare services, it has relatively high cost-sharing requirements and deductibles.
Moreover, it doesn’t limit out-of-pocket spending for beneficiaries covered under parts A and B.
It’s also quite disadvantageous to older people and people with disabilities who require long-term services and support like eyeglasses, hearing aids, and dental services.
For this reason, many beneficiaries covered under the original plan have some supplementary insurance policy that helps to cover some of the costs not covered by the original plan.
The Bottom Line
The creation of this healthcare program opened the doors for vulnerable members of our society to receive affordable medical care coverage. In 2019, there were 61.2 million people enrolled in the program. This number has risen considerably over the past one and a half years, with over 26 million people enrolled in an advantage plan.