Understanding Medicare

If you are exploring your options or you are new to Medicare –

Learn about the coverage offered by different Medicare Parts, associated costs, and compare Original Medicare to Medicare Advantage (also known as Part C)

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Who is Eligible for Medicare?

Are you new to Medicare? You qualify if you are:

  • Turning 65 soon
  • Retiring soon after working past age 65
  • Disabled under age 65
  • Legal resident age 65 and older
  • Have End Stage Renal Disease

What Does Medicare Do?

Medicare is the federal health insurance program for people who are eligible.

There are 3 main parts of Medicare that cover costs for medical services. When you first sign up for Medicare, you will enroll in Parts A and B. Then you need to select a prescription drug plan that meets your needs.

Part A: Hospital Insurance
  • Hospitalization
  • Skilled Nursing Care
  • Home Health Care
  • Hospice Care
Part B: Medicare Insurance
  • Doctor’s Visits
  • Preventive services
  • Outpatient Care
  • Home Health Care
  • Medical Supplies (durable medical equipment)
Part D: Prescription Drug Coverage
  • Prescription Drugs
  • Many Recommended Shots or Vaccines

Your Medicare Options

Medicare covers you through either of two options. You can choose different options when you first enroll and during certain times of the year (see Enrolling In Medicare).

Option 1

Original Medicare
  • Original Medicare includes Part A and Part B.
  • You can choose to add other coverage to help cover costs not covered by Medicare, like prescription drugs and supplemental insurance.
  • Part A
  • Part B
  • Part D

Additional Insurance

  • Medigap

Option 2

Medicare Advantage (Part C)
  • Medicare Advantage is an “all in one” alternative to Original Medicare. These “bundled” plans include Part A, Part B, and usually Part D.
  • Most plans offer extra benefits that are not covered in Original Medicare—like vision, hearing, dental, and more
  • Part A
  • Part B
  • Part D
  • Extra benefits

The Line Up: Original Medicare Vs. Medicare Advantage (Part C)

Doctor and Hospital Choice
Original Medicare Medicare Advantage (Part C)
You can go to any doctor or hospital that takes Medicare, anywhere in the U.S. In many cases, you’ll need to use doctors who are in the plan’s network and service area. Using providers outside the plan’s network and service area may not be covered.
In most cases, you don’t need a referral to see a specialist. You may need to get a referral to see a specialist.

For most Medicare enrollees who have SSA’s 40 work credits, Part A premium is free. Everybody must pay a monthly premium for Part B. To be eligible for Part C, you must be enrolled in Parts A and B, and pay your Part B monthly premium.

Original Medicare Medicare Advantage (Part C)
You pay 20% of the Medicare-approved amount (your coinsurance) of any Part B-covered services, after you meet your deductible. Out-of-pocket costs vary—plans may have lower out-of-pocket costs for certain services.
For drug coverage, a plan , you’ll pay a Medicare drug (Part D) plan premium separately from your monthly Part B premium. You have to pay the Part C plan’s premium, PLUS your monthly Part B premium. Most plans include drug coverage (Part D).
There is no yearly limit on what you pay out of pocket, unless you have supplemental coverage—like Medicare Supplemental insurance (Medigap). Plans have a yearly limit on what you pay out of pocket for Medicare Part A and B covered services. Once you reach your plan’s limit, you’ll pay nothing for Part A and B covered services for the rest of the year.
You can get Medigap to help pay your out-of-pocket costs (like your 20% coinsurance). Or you can use coverage from a former employer or union, or Medicaid. You can’t buy and don’t need Medigap.
Original Medicare Medicare Advantage (Part C)
Original Medicare covers most medically necessary services and supplies in hospitals, doctors’ offices, and other health care settings. Original Medicare does NOT cover some benefits like eye exams, dental care, and routine exams. Plans must cover all of the medically necessary services that Original Medicare covers. Most plans off extra benefits that Original Medicare doesn’t cover—like some vision, hearing, dental, routine exams, and more.
If you want drug coverage, you can buy a separate Medicare drug plan (Part D). Drug coverage (Part D) is included in most plans.

What’s Not Covered by Medicare

Medicare doesn’t cover everything. Some of the items and services Medicare doesn’t cover include:

  • Long-Term Care (also called custodial care)
  • Most dental care
  • Dentures
  • Eye exams related to prescribing glasses
  • Cosmetic surgery
  • Hearing aids and exams for fitting them
  • Routine foot care
  • Most care received outside of the United States
  • Most non-emergency transportation
  • Alternative medicine, including experimental procedures and treatments, acupuncture, and chiropractic services with some exceptions

If you need services Medicare doesn’t cover, you’ll have to pay for them yourself, unless you have other insurance or a Medicare Advantage plan that may cover them.

If you already have Medicare:

  • Do you want to review or change your Medicare health and drug coverage?
    • Enrollment Periods to see when you can change plans
    • Medigap Plans and Savings Programs in Supplemental Programs
    • Medicare Advantage Plans in Part C
    • Plan comparisons in SHIP Services
  • Are you having difficulty paying for your Medicare premiums?
    • Savings Programs in Supplemental Programs

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