Medicare is a federal government plan that provides health coverage to persons age 65 or over, those that are disabled that have been receiving Social Security benefits for 24 months, and those persons who are receiving kidney dialysis treatments are eligible for Part B of Medicare. The program was established in July 1966. Medicare is divided into two parts: PART A hospital coverage and PART B medical coverage.
- Part A is hospital coverage for which most citizens are automatically eligible upon turning 65. It is financed by taxes on employers and employees.
- Part B is doctor and out patient coverage which is optional to purchase. It is financed by individual monthly premiums, usually deducted from a person's social security check.
- Part A has a deductible that you must pay before Medicare will begin paying for health care services. The Part A deductible will be charged each time there is a hospitalization as long as 60 days separates hospitalizations. Once the deductible is paid, Medicare will pay a share of the covered health care expenses and you will be responsible for a share of the costs of the covered health care expenses. Part A also provides coverage for hospice care, limited skilled nursing care and home health care.
- Part B also has a deductible, but the Part B deductible is an annual deductible. Under Part B, Medicare will pay 80% of covered health care costs and you will be responsible for 20% of the covered health care costs that Medicare does not pay. Under the Affordable Care Act, Part B now covers some preventive services, including a yearly wellness exam, without a deductible or coinsurance.
- The Medicare deductibles and coinsurance amounts are adjusted on an annual basis.
THE MEDICARE MODERNIZATION ACT and THE MEDICARE IMPROVEMENTS FOR PATIENTS AND PROVIDERS ACT (MIPPA):
The Medicare Modernization Act was passed in December 2003. The law made several changes to the Medicare program. One of the biggest changes to Medicare is the introduction of a prescription benefit under Medicare identified as Part D. The Medicare Improvements for Patients and Providers Act (“MIPPA”) was passed in July 2008 and became effective June 1, 2010. This law is also known as Medicare Supplement Modernization. MIPPA helped to modernize the original ten Medicare supplement plans, which were originally designed and implemented in 1992. Effective June 1, 2010, plans E, H, and I are no longer offered for sale. New plans M and N are now offered for sale and may have a lower premium because they offer different cost sharing options. Certain plan benefits have been eliminated and others have been increased under MIPPA. For instance, a hospice benefit is offered in all the new plans effective June 1, 2010. Consumers with the old Medicare supplement plans do not have to purchase a new policy if their current policy is working well for them. For up-to-date information and answers to any of your questions about these federal laws, call 1-800-MEDICARE (800-633-4227) or visit www.medicare.gov.
MORE INFORMATION ABOUT MEDICARE:
For more information on the Medicare program, what is covered, and the changes that have recently been made to the program, please visit www.medicare.gov. The website has a lot of information including a "Frequently Asked Questions" section that covers many topics. You may also want to review the publication "Your Medicare Rights and Protections."