Medicare, established in 1965, provides health coverage to Americans who are 65 years and older, who have disabilities, or who have end-stage renal disease. This federal program is composed of four main parts:
- Part A – Hospital Insurance
- Part B – Medicare Insurance
- Part C – Medicare Advantage
- Part D – Voluntary (Outpatient) Prescription Drug Benefits
Parts A and B are the basic Medicare options.
Overall, Medicare is designed to help the disabled and seniors obtain access to quality health care without exorbitant costs. Americans are automatically enrolled in Medicare at age 65.
Medicare can be a maze of complex rules, confusing regulations, and varying coverage. What follows is a simplified explanation of how it works.
Part A – Hospitalization Insurance
Medicare Part A helps to cover inpatient hospital care, including care provided by skilled nursing facilities and nursing homes, as well as hospice care and certain home health care expenses.
Part B – Medicare Insurance
Supplies and services needed to diagnose and treat medical conditions are covered under Medicare Part B, also referred to as Medicare Medical Insurance. This includes outpatient care, physician services and services such as occupational therapy, physical therapy, and home health services that are not covered under Part A. Some preventative health screening services are also covered under Part B.
Part C – Medicare Advantage
Also known as Medicare Advantage, Medicare Part C enables you to select a health plan through a private insurance provider approved by Medicare. Medicare Advantage Part C plans include managed care insurance plans, such as HMOs and PPOs, as well as private, fee-based plans.
Part D – Prescription Drug Benefits (voluntary and outpatient)
To obtain Medicare Part D prescription drug coverage, you must be enrolled in a Medicare-approved prescription drug plan. Enrollment in a Medicare Advantage plan that contains prescription drug coverage is another way to get prescription drug coverage.
To address some of the costs that are not covered by other Medicare plans, you can choose to purchase supplemental Medigap insurance. Medigap is provided by private insurance companies and commonly requires that you first be enrolled in Medicare Part A and B.
As you can see, there are many options for health care coverage with Medicare. Because Medicare can be a complicated program to fully understand, it is best to contact your health insurance provider to tailor a Medicare plan that is best for your individual budget and health concerns.