Understanding How Medicare Works

The essential ABCs (and D!) of Medicare

The Medicare program was designed in four parts, each part covering a different benefit category. As a Medicare eligible person, you will likely need and use a combination of these services depending on your health and as you get older.

Part A – Hospital Coverage

Most people who qualify for Medicare automatically get Part A coverage without having to pay a premium. Part A includes inpatient hospital care, long-term care in hospitals and treatment in a critical access hospital.

Part B – Medical Coverage

Part B covers your medically necessary doctors’ services and outpatient care. A Part B premium is deducted from your social security check each month to help pay the cost of this coverage.

Part C – Medicare Advantage Plans

If you have part C, your coverage is provided by a private health plan called a Medicare Advantage plan. The health plans are contracted with Medicare. The coverage includes everything covered under Part A and Part B, except hospice care (original Medicare continues to cover hospice care) and may include additional benefits not available with Original Medicare.

Part D – Prescription Drug Coverage

If you choose Part D coverage, it can help lower your prescription drug costs. This coverage is available as a stand-alone plan or may be included in a Medicare Advantage plan. To learn more and have your questions answered, contact your local licensed insurance agent. You may also desire to attend an upcoming Medicare 101 session taught by local area licensed insurance agents. 

Choosing Coverage Based on Your Health Needs

Choosing Original Medicare Only. This means that you have Medicare Part A and/or Medicare Part B only. Keep in mind, Medicare does not cover 100% of your medical and hospital costs, which will require you to meet a deductible and then pay a percentage of the cost of your care. Original Medicare also does not provide coverage for prescription drugs. For this, you need an additional standalone plan that may charge an expensive monthly premium.

Purchasing a Medicare Supplement.  The supplement provides additional, variable coverage to fill in part or all of the gaps or costs not covered by Original Medicare, but the cost to you may be an expensive monthly premium.

Selecting a Medicare Advantage Plan.  A Medicare Advantage plan (Medicare Part C) includes all the healthcare benefits you are entitled to under Original Medicare, and may include coverage like vision, hearing, dental and prescription drug coverage or provide monies toward over-the-counter supplies.  Some Medicare Advantage plans may come with a $0 premium.  Medicare Advantage plans can, however, choose not to cover the costs of services that are not medically necessary under Medicare.  Medicare Advantage plans contract with the government to provide coverage to you, so you are still in the Medicare program but you don’t need to use your Medicare card when you obtain medical services.

To learn more and have your questions answered, contact your local licensed insurance agent. You may also desire to attend an upcoming Medicare 101 session taught by local area licensed insurance agents.