With the ever-changing medical insurance environment understanding Medicare is coming very challenging.
Helping your elderly parents understating Medicare is as important as you understanding how it works.
Are you Eligible for Medicare?
If you are age 65 or older, you qualify for Medicare if:
- You collect or qualify to collect Social Security or Railroad Retirement benefits OR
- You are a current U.S. resident, and you are a U.S. citizen. Or you’re a permanent U.S. resident who has lived in the United States for five continuous years.
If you are under age 65, you qualify for Medicare if:
- You’ve been receiving Railroad Disability Annuity or Social Security Disability Insurance (SSDI) checks for 24 months or more
- You’ve been diagnosed with Amyotrophic Lateral Sclerosis (ALS) and have or are currently receiving Railroad Disability Annuity checks or Social Security Disability Insurance (SSDI) or,
- You have a condition called “end-stage renal disease” (ESRD), and you, your parent, or your spouse has paid all their Medicare taxes within a sufficient time period. ESRD refers to a case where one’s kidneys no longer work properly and requires a kidney transplant or dialysis to continue living.
What Medicare Covers?
First, it is important to realize that there are different parts of Medicare for your aging parent:
Part A (Hospital Insurance): Part A provides coverage for inpatient hospital care, home care, and some facility stays with skilled nursing and hospice care. If you or your spouse has been gainfully employed for a period of over 40 quarters (10 years) and you have paid your Medicare taxes from your payroll, then you qualify for Part A health coverage, meaning that you don’t have to pay a monthly premium. This is referred to as “premium-free Part A.”
Part B (Medical Insurance): Part B, or the Supplementary Medical Insurance (SMI) program, helps pay for physician services, outpatient hospital care, and some home care service visit not covered under Part A. It also covers laboratory and diagnostic tests, such as X-rays and blood work; durable medical equipment, such as walkers and wheelchairs; specific preventive tests and screening services, such as screenings for prostate cancer, mammograms, outpatient speech, occupational and physical therapy; outpatient treatment for mental health care, and ambulance services.
Part C (Medicare Advantage): Part C, Medicare Advantage is a private insurance plan. Medicare Advantage plans are managed care plans, such as Health Maintenance Organizations (HMOs) or PPOs – Preferred Provider Organizations. The Medicare Advantage plans must cover all Part A and B services and usually include Part D (prescription drug coverage) benefits in the same plan. Plans like these cover other benefits not included by traditional Medicare. For example, dental care and routine vision check-ups. All plans have an annual limit on your out-of-pocket costs for Part A and B services, and once you’ve maxed that limit, you are no longer responsible for payment for services that are covered for the rest of the calendar year. The amount one pays out-of-pocket can be set to a high limit, which may protect you if you anticipate that you will need a lot of expensive health care treatment. One can expect out-of-pocket costs to still include deductibles, copayments, and coinsurance.
Part D (prescription drug coverage): Medicare began to offer outpatient prescription drug coverage under Medicare Part D in 2006. Medicare drug coverage is optional for most people with Medicare, but it is often only offered through private Medicare plans. If you are someone who has Original Medicare and wants to add the additional Part D that covers drugs, you can get a stand-alone prescription drug plan (PDP). People who want a Medicare Advantage plan and drug coverage must generally get it through one plan called a Medicare Advantage prescription drug plan (MA-PD)