Straight talk. Answers to 3 FAQ’s about Medicare and Medicare Supplement Insurance. You don’t need to be a Medicare expert or devote hours reading info and researching online to understand your Medicare and Medicare Supplement options.
Q: What is the difference between Original Medicare and Medicare Advantage (MA) Plans?
A: There are several key differences between Original Medicare and Medicare Advantage Plans. Original Medicare is your government Medicare. Medicare Advantage is private Medicare that takes the place of your government Medicare. You will have similar out-of-pocket expenses with an MA plan as you would with Original Medicare alone.
It is important to understand that in general an MA plan is the same coverage as Original Medicare. You may get some extra benefits such as dental or eyeglasses, and some of the plans include drug coverage as well, but the base coverage will be the same as original Medicare.It is not the same as Medicare plus a Medigap or Supplement Plan. You can not get a supplement plan to cover your out-of-pocket expenses when you are enrolled in an MA plan.
Q: What are my potential out-of-pocket expenses with my Medicare coverage?
A: Medicare itself is great coverage but there are some gaps in the coverage that many beneficiaries fill with a Medicare Supplement policy.
Medicare Part A covers hospital room and board, short-term skilled nursing care and hospice care.
There is a deductible for Part A. Currently the deductible is $1132.00. This means that you will pay the first $1132.00 before Medicare benefits are paid. This is not an annual deductible. It is a benefit period deductible. A benefit period starts the day you are admitted to the hospital and ends 60 days after you are released. It is possible that you could encounter the Part A deductible more than once in a year. After the deductible is met Medicare covers 100% semi-private room and board for 60 days. From day 61-90 the is a daily co-insurance of $283 per day. After 90 days Medicare provides coverage for an additional 60 lifetime reserve days with you paying a daily co-pay of $566.
Skilled nursing facility following a hospital stay of at least 3 days is covered by Medicare at 100% for the first 20 days. Days 21-100 have a $141.50 co-pay per day.
Hospice is covered by Medicare with very limited co-pays.
The deductibles and co-insurances increase from year to year.
Your exposure on the A side of Medicare are your deductible, and the various co-insurances mentioned above.In addition, Medicare doesn’t cover the first 3 pints of blood.
Medicare Part B covers medical expenses in or out of the hospital such as doctor visits, inpatient and outpatient medical and surgical services and supplies.Diagnostic testing, speech and physical therapy, and durable medical equipment are Part B expenses.
There is a calendar year deductible for Part B. This year the deductible is $162.00. After you have met your deductible medicare covers 80% of approved amounts for covered services.
Your exposure on the B side of Medicare includes the deductible and 20% of approved amounts for covered services and any Part B excess charges. Part B excess charges are charges for covered services that exceed Medicare approved amounts.
Q: How can I limit my exposure and cover the gaps in my Medicare coverage.
A: You can supplement your Medicare coverage with a Medigap insurance policy.
There are 10 Medicare supplement policies that are approved by Medicare. All of the supplements have the same basic benefits.
Medicare supplement basic benefits for Medicare Part A cover all of your hospital co-insurances and will extend your covered days beyond Medicare coverage for and additional 365 days. The Part A deductible and skilled nursing co-insurance coverage are optional benefits.
Your supplement will automatically adjust to the changes in Medicare deductibles and co-pays from year to year.
Under Medicare Part B, Medicare Supplement basic benefits will cover your 20% co-insurance.
You can choose a supplement plan that includes optional benefits such as Part B deductible, Part B excess, and foreign travel emergency coverage.
Seek the guidance of a broker who specializes in Medicare to help you determine which of the 10 Medicare Supplement Plans best suits your needs.
For information on what is Medicare plan N click here.