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Medicare 101
The A, B, C (&D's) of Medicare
Part A
Covers Inpatient hospitalization, skilled nursing, hospice and home health care services. The first 60 days are subject to the Part A deductible. Once the Part A deductible is met there is a per day copay from day 61 - 90.
Part B
This is called your "Medical Insurance" (sometimes referred to as "Physician Services"). Part B covers things like doctor office visits, lab tests, MRI’s, outpatient surgery, and so on. You will have to pay the Part B deductible. Once the Part B deductible is met you are responsible for 20% of charges. There is no stop loss or limit to the dollar amount of the 20%.
Part C - Also known as "Medicare Advantage"
This is a way to receive your Part A (hospital), Part B (medical), and in many cases Part D (pharmacy drug coverage) all in one convenient plan. All Medicare Advantage plans have an out of pocket maximum that greatly limits your total financial exposure.
Part D
Typically covers prescription drugs that you pick up at a pharmacy. There are only two ways to get Part D coverage: 1) Enroll in a standalone Part D prescription drug plan or 2) Enroll in a Medicare Advantage plan that includes Part D prescription drug coverage.
Did you know there are two ways to receive your Medicare benefits?
Option #1
Medicare Supplement + Standalone Drug Plan
You keep Medicare parts A & B.
Enroll in a Medicare supplement plan (a.k.a. “Medigap”) to help cover your portion of medical expenses that Medicare doesn't cover. Also, enroll in a standalone Part D prescription drug plan to cover medications you have filled at a pharmacy (NOTE: Medigap plans do not include Part D drug coverage which is why you would also need to enroll in a standalone drug plan if you choose the Medigap option).
Option #2
Part C - "Medicare Advantage"
Enroll in a Medicare Advantage plan.
These plans are administered by private health insurance companies with a Medicare contract. Medicare Advantage plans incorporate parts A, B, and (in most plans) part D within one plan.
Not sure which Medicare option is right for you?
Let's take a closer look the pros and cons of Medicare supplements and Medicare Advantage plans.
Pros and Cons of Medicare Supplement (a.k.a. "Medigap") plans
Medicare supplement (also called “Medigap”) plans do exactly what the name suggests: they supplement, or ‘fill in the gaps’, of the health care costs Medicare doesn’t cover. Some people mistakenly assume that Medicare supplement plans offer benefits beyond what Medicare covers. The truth is that Medicare supplement plans follow Medicare benefits like a train and caboose. If Medicare covers a procedure or service, then a Medicare supplement plan will cover the same procedure or service – paying the portion Medicare does not pay up to plan limits. Medicare supplement plans are standardized; they offer the same benefits and provider choices regardless of the insurance company and are identified by letters A through N. Premiums are the only difference between Medicare supplement plans with the same letter sold by different insurance companies. Medicare supplement plans are also very portable – meaning that you can take it anywhere in the U.S. and the benefits will be the same. There are no network restrictions, so you can see any medical provider in the U.S. who accepts Medicare and there are no referrals required to see specialist doctors. Medicare supplement plans in general offer more freedom and flexibility compared to Medicare Advantage plans.
Things to consider regarding Medicare supplements
Medicare supplement plans have premiums that tend to be higher than Medicare Advantage plans and the premiums typically increase as you get older. The other downside is that you will also need to enroll in a standalone prescription drug plan, for an additional premium, in order to receive Part D benefits (Medicare Part D is pharmacy prescription drug coverage.
Pros and Cons of Medicare Advantage plans
Medicare Advantage plans have become increasingly popular over the years for a variety of reasons. Most notably the premiums will be considerably lower than Medicare supplement plans (in some areas Medicare Advantage plans have $0 premiums) and most include Part D coverage so there is no need to purchase a standalone drug plan. Copays are fairly nominal under most plans for everything from doctor office visits to diagnostic testing, rehabilitation, outpatient surgeries and inpatient hospitalization. Plus they may also include extra benefits for things that Medicare doesn’t cover like dental, vision, chiropractic and acupuncture. Many also have free gym memberships to help keep their subscribers active and healthy. Some Medicare Advantage plans will also offer free transportation to and from doctor office visits and other medically related appointments (including to and from the pharmacy).
Things to consider regarding Medicare Advantage plans
With a few exceptions, Medicare Advantage plans are network based plans. A majority of Medicare Advantage plans are HMO’s, which are very network restrictive. As with most HMO plans, if you go out of the network for routine care you will be responsible for the entire cost (emergency care is covered in-network for all Medicare Advantage plans regardless of where it occurs). There are Medicare Advantage PPO plans offered in a few areas but they tend to have higher premiums and out-of-pocket costs (i.e.: deductibles, copays and co-insurance) than their HMO counterparts. And even though PPO plans will cover you in the event that you want to see an out of network provider, the out of network costs are typically 50% of charges – which cost wise could be too steep for some people.
One other thing you want to be especially aware of is the “Out of Pocket Maximum” (sometimes referred to as the Annual Out of Pocket Maximum or Maximum Out of Pocket, etc.). This is the most you could be responsible for in a given year. The highest Out of Pocket Maximum that Medicare allows in 2020 is $6,700 – although many Medicare Advantage plans have much lower Out of Pocket Maximums. Ideally, if you do choose a Medicare Advantage plan, you will want a plan with an Out of Pocket Maximum as low as possible.
The Bottom Line
Some people find that their doctors are already in a network and they would prefer to save on monthly premiums. They may also be attracted to the ‘extra benefits’ that a Medicare Advantage plan offers. In these cases, a Medicare Advantage plan works well. For others, perhaps they have doctors who are not in any networks and/or they may do a lot of traveling. Maybe they live in more remote areas where their Medicare Advantage plan choices are ‘slim pickings’ to none at all. In these cases a Medicare supplement plan is much more appropriate. Typically, the right plan option comes down to three things: doctors, drugs and affordability. Will all of your doctors accept your plan? If not, would you be willing to change any of your doctors? Are all of your medications covered and at reasonable copays? Is the monthly premium(s) going to leave you strapped at the end of every month? And so on.
Most people find it very helpful to talk to a knowledgeable health insurance agent or broker who specializes in Medicare and is appointed and contracted with many insurance companies. Agents and brokers by law are not allowed to charge consumers for advice or help with health insurance matters. Your premiums will be the same no matter if you enroll directly through an insurance company or through an agent or broker (agent and broker compensation comes from the insurance companies for the business that they write). Plus a good agent or broker will also advocate on behalf of their Medicare clients on issues that may come up down the road.
Click here to find Medicare plans available in your area.
Find Medicare Plans Available In Your Area:
Medicare 101
The A, B, C (&D's) of Medicare
Part A
Covers Inpatient hospitalization, skilled nursing, hospice and home health care services. The first 60 days are subject to the Part A deductible. Once the Part A deductible is met there is a per day copay from day 61 - 90.
Part B
This is called your "Medical Insurance" (sometimes referred to as "Physician Services"). Part B covers things like doctor office visits, lab tests, MRI’s, outpatient surgery, and so on. You will have to pay the Part B deductible. Once the Part B deductible is met you are responsible for 20% of charges. There is no stop loss or limit to the dollar amount of the 20%.
Part C - Also known as "Medicare Advantage"
This is a way to receive your Part A (hospital), Part B (medical), and in many cases Part D (pharmacy drug coverage) all in one convenient plan. All Medicare Advantage plans have an out of pocket maximum that greatly limits your total financial exposure.
Part D
Typically covers prescription drugs that you pick up at a pharmacy. There are only two ways to get Part D coverage: 1) Enroll in a standalone Part D prescription drug plan or 2) Enroll in a Medicare Advantage plan that includes Part D prescription drug coverage.
Did you know there are two ways to receive your Medicare benefits?
Option #1
Medicare Supplement + Standalone Drug Plan
You keep Medicare parts A & B.
Enroll in a Medicare supplement plan (a.k.a. “Medigap”) to help cover the portion of Medicare parts A & B you are responsible for. Also enroll in a standalone Part D prescription drug plan to cover medications you have filled at a pharmacy (NOTE: Medigap plans do not include Part D drug coverage which is why you would also need to enroll in a standalone drug plan if you choose the Medigap option).
Option #2
Part C - "Medicare Advantage"
Enroll in a Medicare Advantage plan.
These plans are administered by private health insurance companies with a Medicare contract. Medicare Advantage plans incorporate parts A, B, and (in most plans) part D within one plan.
Not sure which Medicare option is right for you?
Let's take a closer look the pros and cons of Medicare supplements and Medicare Advantage plans.
Pros and Cons of Medicare Supplement (a.k.a. "Medigap") plans
Medicare supplement (also called “Medigap”) plans do exactly what the name suggests: they supplement, or ‘fill in the gaps’, of the health care costs Medicare doesn’t cover. Some people mistakenly assume that Medicare supplement plans offer benefits beyond what Medicare covers. The truth is that Medicare supplement plans follow Medicare benefits like a train and caboose. If Medicare covers a procedure or service, then a Medicare supplement plan will cover the same procedure or service – paying the portion Medicare does not pay up to plan limits. Medicare supplement plans are standardized; they offer the same benefits and provider choices regardless of the insurance company and are identified by letters A through N. Premiums are the only difference between Medicare supplement plans with the same letter sold by different insurance companies. Medicare supplement plans are also very portable – meaning that you can take it anywhere in the U.S. and the benefits will be the same. There are no network restrictions, so you can see any medical provider in the U.S. who accepts Medicare and there are no referrals required to see specialist doctors. Medicare supplement plans in general offer more freedom and flexibility compared to Medicare Advantage plans.
Things to consider regarding Medicare supplements
Medicare supplement plans have premiums that tend to be higher than Medicare Advantage plans and the premiums typically increase as you get older. The other downside is that you will also need to enroll in a standalone prescription drug plan, for an additional premium, in order to receive Part D benefits (Medicare Part D is pharmacy prescription drug coverage.
Pros and Cons of Medicare Advantage plans
Medicare Advantage plans have become increasingly popular over the years for a variety of reasons. Most notably the premiums will be considerably lower than Medicare supplement plans (in some areas Medicare Advantage plans have $0 premiums) and most include Part D coverage so there is no need to purchase a standalone drug plan. Copays are fairly nominal under most plans for everything from doctor office visits to diagnostic testing, rehabilitation, outpatient surgeries and inpatient hospitalization. Plus they may also include extra benefits for things that Medicare doesn’t cover like dental, vision, chiropractic and acupuncture. Many also have free gym memberships to help keep their subscribers active and healthy. Some Medicare Advantage plans will also offer free transportation to and from doctor office visits and other medically related appointments (including to and from the pharmacy).
Things to consider regarding Medicare Advantage plans
With a few exceptions, Medicare Advantage plans are network based plans. A majority of Medicare Advantage plans are HMO’s, which are very network restrictive. As with most HMO plans, if you go out of the network for routine care you will be responsible for the entire cost (emergency care is covered in-network for all Medicare Advantage plans regardless of where it occurs). There are Medicare Advantage PPO plans offered in a few areas but they tend to have higher premiums and out-of-pocket costs (i.e.: deductibles, copays and co-insurance) than their HMO counterparts. And even though PPO plans will cover you in the event that you want to see an out of network provider, the out of network costs are typically 50% of charges – which cost wise could be too steep for some people.
One other thing you want to be especially aware of is the “Out of Pocket Maximum” (sometimes referred to as the Annual Out of Pocket Maximum or Maximum Out of Pocket, etc.). This is the most you could be responsible for in a given year. The highest Out of Pocket Maximum that Medicare allows in 2020 is $6,700 – although many Medicare Advantage plans have much lower Out of Pocket Maximums. Ideally, if you do choose a Medicare Advantage plan, you will want a plan with an Out of Pocket Maximum as low as possible.
The Bottom Line
Some people find that their doctors are already in a network and they would prefer to save on monthly premiums. They may also be attracted to the ‘extra benefits’ that a Medicare Advantage plan offers. In these cases, a Medicare Advantage plan works well. For others, perhaps they have doctors who are not in any networks and/or they may do a lot of traveling. Maybe they live in more remote areas where their Medicare Advantage plan choices are ‘slim pickings’ to none at all. In these cases a Medicare supplement plan is much more appropriate. Typically, the right plan option comes down to three things: doctors, drugs and affordability. Will all of your doctors accept your plan? If not, would you be willing to change any of your doctors? Are all of your medications covered and at reasonable copays? Is the monthly premium(s) going to leave you strapped at the end of every month? And so on.
Most people find it very helpful to talk to a knowledgeable health insurance agent or broker who specializes in Medicare and is appointed and contracted with many insurance companies. Agents and brokers by law are not allowed to charge consumers for advice or help with health insurance matters. Your premiums will be the same no matter if you enroll directly through an insurance company or through an agent or broker (agent and broker compensation comes from the insurance companies for the business that they write). Plus a good agent or broker will also advocate on behalf of their Medicare clients on issues that may come up down the road.
Tap here to find Medicare plans available in your area.
Find Medicare Plans Available In Your Area:
Medicare 101
The A, B, C & D's of Medicare
Part A
Covers Inpatient hospitalization, skilled nursing, hospice and home health care services. The first 60 days are subject to the Part A deductible. Once the Part A deductible is met there is a per day copay from day 61 - 90.
Part B
This is called your "Medical Insurance" (sometimes referred to as "Physician Services"). Part B covers things like doctor office visits, lab tests, MRI’s, outpatient surgery, and so on. You will have to pay the Part B deductible. Once the Part B deductible is met you are responsible for 20% of charges. There is no stop loss or limit to the dollar amount of the 20%.
Part C - Also known as "Medicare Advantage"
This is a way to receive your Part A (hospital), Part B (medical), and in many cases Part D (pharmacy drug coverage) all in one convenient plan. All Medicare Advantage plans have an out of pocket maximum that greatly limits your total financial exposure.
Part D
Typically covers prescription drugs that you pick up at a pharmacy. There are only two ways to get Part D coverage: 1) Enroll in a standalone Part D prescription drug plan or 2) Enroll in a Medicare Advantage plan that includes Part D prescription drug coverage.
Did you know there are two ways to receive your Medicare benefits?
Option #1
Medigap + Standalone Drug Plan
You keep Medicare parts A & B.
Enroll in a Medicare supplement plan (a.k.a. “Medigap”) to help cover the portion of Medicare parts A & B you are responsible for. Also enroll in a standalone Part D prescription drug plan to cover medications you have filled at a pharmacy (NOTE: Medigap plans do not include Part D drug coverage which is why you would also need to enroll in a standalone drug plan if you choose the Medigap option).
Option #2
Part C - "Medicare Advantage"
Enroll in a Medicare Advantage plan.
These plans are administered by private health insurance companies with a Medicare contract. Medicare Advantage plans incorporate parts A, B, and (in most plans) part D within one plan.
Not sure which Medicare option is right for you?
Let's take a closer look the pros and cons of Medicare supplements and Medicare Advantage plans.
Pros and Cons of Medicare Supplement (a.k.a. "Medigap") plans
Medicare supplement (also called “Medigap”) plans do exactly what the name suggests: they supplement, or ‘fill in the gaps’, of the health care costs Medicare doesn’t cover. Some people mistakenly assume that Medicare supplement plans offer benefits beyond what Medicare covers. The truth is that Medicare supplement plans follow Medicare benefits like a train and caboose. If Medicare covers a procedure or service, then a Medicare supplement plan will cover the same procedure or service – paying the portion Medicare does not pay up to plan limits. Medicare supplement plans are standardized; they offer the same benefits and provider choices regardless of the insurance company and are identified by letters A through N. Premiums are the only difference between Medicare supplement plans with the same letter sold by different insurance companies. Medicare supplement plans are also very portable – meaning that you can take it anywhere in the U.S. and the benefits will be the same. There are no network restrictions, so you can see any medical provider in the U.S. who accepts Medicare and there are no referrals required to see specialist doctors. Medicare supplement plans in general offer more freedom and flexibility compared to Medicare Advantage plans.
Things to consider regarding Medicare supplements
Medicare supplement plans have premiums that tend to be higher than Medicare Advantage plans and the premiums typically increase as you get older. The other downside is that you will also need to enroll in a standalone prescription drug plan, for an additional premium, in order to receive Part D benefits (Medicare Part D is pharmacy prescription drug coverage.
Pros and Cons of Medicare Advantage plans
Medicare Advantage plans have become increasingly popular over the years for a variety of reasons. Most notably the premiums will be considerably lower than Medicare supplement plans (in some areas Medicare Advantage plans have $0 premiums) and most include Part D coverage so there is no need to purchase a standalone drug plan. Copays are fairly nominal under most plans for everything from doctor office visits to diagnostic testing, rehabilitation, outpatient surgeries and inpatient hospitalization. Plus they may also include extra benefits for things that Medicare doesn’t cover like dental, vision, chiropractic and acupuncture. Many also have free gym memberships to help keep their subscribers active and healthy. Some Medicare Advantage plans will also offer free transportation to and from doctor office visits and other medically related appointments (including to and from the pharmacy).
Things to consider regarding Medicare Advantage plans
With a few exceptions, Medicare Advantage plans are network based plans. A majority of Medicare Advantage plans are HMO’s, which are very network restrictive. As with most HMO plans, if you go out of the network for routine care you will be responsible for the entire cost (emergency care is covered in-network for all Medicare Advantage plans regardless of where it occurs). There are Medicare Advantage PPO plans offered in a few areas but they tend to have higher premiums and out-of-pocket costs (i.e.: deductibles, copays and co-insurance) than their HMO counterparts. And even though PPO plans will cover you in the event that you want to see an out of network provider, the out of network costs are typically 50% of charges – which cost wise could be too steep for some people.
One other thing you want to be especially aware of is the “Out of Pocket Maximum” (sometimes referred to as the Annual Out of Pocket Maximum or Maximum Out of Pocket, etc.). This is the most you could be responsible for in a given year. The highest Out of Pocket Maximum that Medicare allows in 2020 is $6,700 – although many Medicare Advantage plans have much lower Out of Pocket Maximums. Ideally, if you do choose a Medicare Advantage plan, you will want a plan with an Out of Pocket Maximum as low as possible.
The Bottom Line
Some people find that their doctors are already in a network and they would prefer to save on monthly premiums. They may also be attracted to the ‘extra benefits’ that a Medicare Advantage plan offers. In these cases, a Medicare Advantage plan works well. For others, perhaps they have doctors who are not in any networks and/or they may do a lot of traveling. Maybe they live in more remote areas where their Medicare Advantage plan choices are ‘slim pickings’ to none at all. In these cases a Medicare supplement plan is much more appropriate. Typically, the right plan option comes down to three things: doctors, drugs and affordability. Will all of your doctors accept your plan? If not, would you be willing to change any of your doctors? Are all of your medications covered and at reasonable copays? Is the monthly premium(s) going to leave you strapped at the end of every month? And so on.
Most people find it very helpful to talk to a knowledgeable health insurance agent or broker who specializes in Medicare and is appointed and contracted with many insurance companies. Agents and brokers by law are not allowed to charge consumers for advice or help with health insurance matters. Your premiums will be the same no matter if you enroll directly through an insurance company or through an agent or broker (agent and broker compensation comes from the insurance companies for the business that they write). Plus a good agent or broker will also advocate on behalf of their Medicare clients on issues that may come up down the road.
Tap here to find Medicare plans available in your area.