Medicare is a government national health insurance program in the United States of America, primarily designed to provide health care insurance for people of age 65 and older. It is under the administration of the Center for Medicare and Medicaid Services (CMS). Medicare consists of four parts named alphabetically: Part A, B, C, and D. Part A stands for hospital insurance, Part B is medical insurance, Part C refers to Medicare Advantage, and Part D is drug prescription coverage. Part A and Part B of Medicare together create Original Medicare, and they are the main focus of this blog.
Here is everything you need to know about Original Medicare – Medicare Part A and Part B.
Medicare Part A
Medicare Part A is commonly known as hospital insurance because it gives coverage for inpatient hospital services. Part A gives coverage for inpatient hospital care, skilled nursing facility care, long-term care after severe injuries, nursing home care, hospice care, and home health services.
Inpatient hospital care means you must be admitted to the hospital as an inpatient because your doctor ordered it to treat illness or injury. Inpatient care includes semi-private rooms, daily meals, and nursing care. Part A gives the beneficiary coverage for up to 90 days for each benefit period for a stay in a general hospital.
Skilled nursing facility care is covered under Part A only for a limited time and only if you have days left in your benefit period. A benefit period begins the day beneficiary is admitted to the skilled nursing facility or hospital and ends when you aren’t in the hospital for 60 days in a row. An exception from this is if your doctor decides that you need nursing facility care because of your certain medical conditions. In that case, Medicare Part A got you covered.
Long-term care services include rehabilitation, treatment of head trauma, respiratory therapy, and other treatments after severe injuries.
Hospice care is covered under Part A only if it is medically necessary and if the doctor thinks hospice care is needed because of a terminal illness. It is covered also in a case where an individual chose palliative care instead of Medicare treatments to treat an illness.
Home health services are covered for individuals who are under constant doctor`s care.
Before going on eligibility criteria for Medicare Part A, it is important to know one elimination requirement. It is a must to be eligible for Medicare if you are a U.S. citizen or a permanent legal resident who lives in the U.S. for at least five years in a row. After that is met, there are other criteria for Medicare eligibility.
The following criteria are necessary for Medicare Part A eligibility:
- To be 65 years old or older
- If you receive Social Security benefits for at least two years
- If you have been diagnosed with End-Stage Renal Disease (ESRD)
- If you have been diagnosed with ALS (Amyotrophic Lateral Sclerosis)
Part A Premiums and Costs
Most beneficiaries are qualified for premium-free Medicare Part A. The requirement for premium-free Part A is if you or your spouse paid Medicare taxes while you were employed for at least 40 quarters (approximately 10 years). If you are not qualified for premium-free Part A, you will have to pay a monthly premium of $278 up to $506 in 2023.
There are some important rules for hospitalization that can affect your out-of-pocket costs. Inpatient hospitalization after day 90 is considered lifetime reserve days. You receive 60 lifetime reserve days to use throughout your life. If you go beyond these days, you are responsible for all costs after day 91. And costs for hospital stays are designed like this: Day 1-60 of inpatient care is $0/per day, days 61-90 will cost $389/per day for days, and $778/per day from day 91 on.
Part A Enrollment
You can enroll in Medicare Part A during three enrollment periods: The initial Enrollment Period, the Special Enrollment Period, and General Enrollment Period.
The initial enrollment period begins three months before your 65th birthday and lasts until three months after your 65th birthday, and it is the best time to enroll in Medicare.
The special enrollment period is specifically designed for people who are getting coverage through their employer and it lasts for eight months, starting the month after your employment coverage terminates.
The general enrollment period starts every year in January and it is for those individuals who did not successfully complete enrollment during their Initial enrollment period.
Be aware that if you did not enroll in Medicare Part A during your Initial Enrollment Period, and you do not have qualifications for a Special Enrollment period, you might have to pay a late enrollment penalty.
For more information about Medicare enrollment check our blog about How to sign up for Medicare Part A.
Medicare Part B
Medicare Part B is the other half of Original Medicare, and it is known as medical insurance. It covers outpatient services like all supplies that are needed for treatment or diagnosis of medical conditions and preventive care services as well. It specifically covers doctor`s visits, clinical research, ambulance services, durable medical equipment, and mental health services.
Part B covers your doctor`s visits besides Medicare annual wellness visits.
Clinical research is covered under Part B for services given during doctor`s office visits and all the tests taken.
Ambulance services are covered only if medically necessary or if it is needed for emergency hospital services.
Durable medical equipment is covered after the doctor gives a prescription for it. It includes blood sugar meters and test strips, wheelchairs, hospital beds, canes, walkers, scooters, etc.
Mental health services include depression screenings, family counseling, psychotherapy, psychiatric evaluation, and medication prescribed.
Part B Eligibility
Criteria for Medicare Part B eligibility are the same as for Medicare Part A. Individual must be U.S. citizen or permanent legal resident who lives in the U.S. for at least five years in a row. It is required to be 65 years old or older. An individual can qualify if they are receiving Social Security benefits for 2 years in a row, or if diagnosed with End-Stage Renal Disease or ALS.
Part B Premium and Costs
Medicare Part B costs include a monthly premium, coinsurance, and deductibles. Coinsurance is your share in received services; Medicare usually pays 80% of costs and you are responsible for the remaining 20% in form of coinsurance. The standard monthly fee for Medicare Part B in 2023 is $164.90, and it is usually higher for those beneficiaries with higher incomes. The annual deductible for Medicare Part B is $226 in 2023.
Part B Enrollment
Enrollment in Medicare Part B is the same as in Medicare Part A. You have three enrollment periods for Medicare Part B: Initial Enrollment Period, Special Enrollment Period, and General Enrollment Period.
The initial enrollment period begins three months before your 65th birthday and lasts until three months after your 65th birthday, and during this time you can enroll in both Medicare Part A and Part B, or commonly referred Original Medicare.
The special enrollment period is specifically designed for people who are getting coverage through their employer and it lasts for eight months, starting a month after your employment coverage terminates. They can choose here if they want to enroll in both parts of Original Medicare or only one of them.
The general enrollment period starts every year in January and it is for those individuals who did not successfully complete enrollment during their Initial enrollment period. It is for cases where a person failed to enroll in any part of Medicare during their Initial enrollment period if they have been enrolled in Part A, but not Part B, and vice versa. During this period you can even sign up for Medicare Advantage (Part C) if you are already enrolled in Original Medicare, or you can switch your Medicare Advantage plan back to Original Medicare.
Important notice: if you did not enroll in Medicare Part A and/or Part B during your Initial Enrollment Period, and you do not have qualifications for a Special Enrollment, you might have to pay a late enrollment penalty.