What is Medicare?

77. What is Medicare?

Medicare (U.S. Social Security Administration;
www.ssa.gov) is a federally run health insurance program
for people who are 65 years of age or older, or
who are on Social Security Disability (SSD)
 for two consecutive years, are legally blind, or
are on renal dialysis. A brief outline of Medicare coverage
is provided here; for more information refer to the
official Medicare Web site at www.medicare.gov.


Social Security Disability = A federally run program
that provides a monthly income to disabled workers and
their families.


• Part A. Usually free to you, but may be purchased if
you have not accrued enough Social Security credits
based on your work contribution history. Traditionally,
this plan covers inpatient hospitalization,
care at a skilled nursing facility (with specific limitations),
hospice care, in-home nursing care, and
home health care. Deductibles and co-payments
may be required.


Social Security = A federally run program that provides
monthly payments to persons over age 65 years and family
survivors; the amount is calculated from the person’s 
work history.

Hospice care = A facility or home care program designed
to help meet the physical and emotional needs of
the terminally ill.


• Part B. Optional, and is purchased by paying
monthly premiums (usually $96.40/month in 2009,
but may be higher based on income). This plan covers
most medical services, lab tests, outpatient hospital
services, medical equipment, supplies (usually
including ostomy supplies), and chemotherapy, if
administered by your healthcare provider. It also may
cover some preventive care services, including cancer
screenings. If you also meet Medicaid requirements,
the premium may be paid as part of a program called
Qualified Medicare Beneficiary Program. Medicare
previously did not cover prescription medications
(those not administered by hospital staff ), syringes,
or insulin for diabetics, experimental treatments,
routine medical transportation (ambulance is covered
in specific circumstances), or nonmedical or
extensive home care services.

• Part C—Medicare Managed Care (Medicare Advantage
Plans: PPOs,HMOs). Medicare establishes an
agreement with certain health insurance companies
to manage your insurance coverage. You continue to
pay for “Part B,” and other fees may be associated
with this type of coverage. If you are enrolled in
such a program, you may receive added benefits.
You will probably be required to choose a primary
care physician and may also have added restrictions,
such as being limited to in-network medical care,
being required to pay additional fees, and more.

• Part D—Prescription Drug Coverage. Medicare
recently added a prescription coverage component,
which may lower drug costs for many people. Typically,
the drug coverage benefit is managed by an
independent insurance company approved by
Medicare. This type of coverage usually entails an
additional fee, and what exactly is covered can vary
across specific plans. All of the specifics of Part D
are beyond the scope of this brief discussion. For
more details, contact the Social Security Administration.

• Medicare Supplemental (or “MediGap”) Plans.
Purchased by you and is intended to provide additional
coverage, such as prescription drug coverage
and other benefits, to people with Medicare. The
government has standardized these plans, and they
provide a range of additional coverage. To learn
more about these policies, order a copy of The Guide
to Health Insurance for People with Medicare (U.S.
Department of Health and Human Services