Making Medicare Choices

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Making Sense Of Medicare

A general understanding of the federal Medicare Program and recent modifications which expand Medicare benefits is helpful when you are considering your Medicare options.

Because your options vary in coverage, costs, quality and even availability, you will want to carefully consider your own health-care requirements, your financial resources and other personal factors as you review this material.

Taking the time to learn about Medicare and evaluate options now — before you are required to make decisions — is important. Use this article as a guide to making Medicare choices; it will not recommend any specific options.

Original Medicare

Original Medicare is comprised of two separate parts, Part A Hospital Insurance and Part B Medical Insurance, each with different coverages, rules and cost structures. Original Medicare is managed by the federal government and the benefits are the same for all Medicare beneficiaries nationwide.

Medicare Part A And Part B

Medicare Part A Hospital Insurance

• Provides coverage to help you pay for inpatient care in hospitals and skilled nursing facilities (does not include custodial or long-term care services). Part A also helps cover some home health-care and hospice services and inpatient prescription drugs. For specific coverage details visit www.medicare.gov or call Medicare at (800) 633-4227.
• Coverage is premium-free for most eligible individuals.
• Generally, you are automatically enrolled on your 65th birthday.

Medicare Part B Medical Insurance

• Provides coverage to help you pay for physician's services, outpatient care and some other Medicare-approved medical expenses not covered by Part A. For specific coverage details visit www.medicare.gov or call Medicare at (800) 633-4227.
• Coverage is voluntary and premiums are generally deducted from your Social Security check.
• Premium is set by the federal government and can change from year to year. The standard monthly premium in 2008 is $96.40; however, individuals with higher incomes may pay more. For 2008, individuals will pay a higher monthly premium if their 2006 federal income tax return had modified adjusted gross income of $82,000 or more ($164,000 if married).
• Unlike Medicare Part A where you are automatically enrolled on your 65th birthday, you must enroll in Part B coverage. You will receive a government-solicited offer before your 65th birthday, which is your Initial Enrollment Period. In order for your Part B coverage to begin when you turn 65, you must enroll during the 3 months prior to the month you turn age 65.
• If you wait until your Part B Initial Enrollment Period is over (3 months after the month you turn 65), your start date will be delayed and you may have to pay more for your Medicare Part B premium. A late enrollment penalty increases the premium 10 percent for each 12-month period for which you could have had Part B but did not enroll and this penalty would apply as long as you have Medicare Part B.
• If you miss your Initial Enrollment Period, you may enroll from January 1 through March 31 each year. Part B coverage begins July 1 if you enroll during this General Enrollment Period.
• There is a Special Enrollment Period if you delay Part B enrollment because you or your spouse has group health coverage through an employer- or union-sponsored health plan. No late enrollment penalty is applicable.
• If you do not enroll in Medicare Part B when you first become eligible, contact the Social Security Administration office to enroll. If you get benefits from the Railroad Retirement Board, call (800) 808-0772.

Gaps In Original Medicare

• You pay separate and different deductibles for Part A and Part B (deductible amounts can change each year).
• You often pay a share of the cost of all covered medical services — usually 20 percent of the Medicare-approved amount or a set co-payment fee.
• You may have to pay all excess charges that physicians or other providers may charge above the Medicare-approved amount.
• You may have to pay for medical services and supplies that Medicare does not cover at all.

Topics covered in this section are:

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