Sunday, October 14, 2012

How does Medicare & Medigap insurance work?



Understanding the basics to Medicare:

Generally, people who are over age 65 and getting Social Security automatically qualify for Medicare Parts A and B.  Some people with certain disabilities also may qualify for Medicare that are under the age of 65. 

Medicare Part A is paid for by a portion of Social Security tax.  It helps pay for inpatient hospital care, skilled nursing care, hospice care and other services.  Part A has coinsurance and a deductible of $1,156 unless you have a Medicare supplement that covers that amount.  This is not an annual deductible and can be every 60 days in some cases.

Medicare Part B is paid for by the monthly premiums of people enrolled and by general funds from the U.S. Treasury.  It helps pay for doctors' fees, outpatient hospital visits, and other medical services and supplies that are not covered by Part A.  Part B has a deductible and coinsurance unless you have a Medigap (Medicare supplement plan) that covers it.  It is important to get a Medicare supplement policy within 6 months of your Part B effective date.  This period is referred to as open enrollment and you are not required to qualify with health questions.

Medigap Insurance (Medicare supplement insurance).  Medicare Part A & B covers about 80% of the costs.  A lot of people decide to get Medicare supplement insurance (Medigap Insurance) to cover the gaps that Part A & B does not cover.  These plans tend to cover deductibles, coinsurance and sometimes copays.  There is no network so any doctor or hospital that accepts Medicare will accept a Medigap plan because it’s the law.  Also, the benefits can’t change from year to year.  The plans are designated with a corresponding letter and currently are Plan A through D, Plan F, Plan G and Plans K through N.
One of our Licensed Benefit Advisors can help make Medicare seem much easier to understand than it appears.  Click the link if you would like to Compare Medicare Supplement Plans Instantly Online.

Part C (Medicare Advantage) is optional if you decide not to get Medicare supplement insurance (Medigap Insurance).  Typically this type of plan has a network and requires you to get a referral to see a specialist.  The benefits to this plan can change from year to year and if you move you may need to change plans.  If you decide you want one of these plans it is very important to understand the “max out of pocket” expense section of the plan.  These plans may help lower your costs of receiving medical services, or you may get extra benefits for an additional monthly fee.  You must have both Parts A and B to enroll in Part C.  You can’t get Medigap Insurance (Medicare supplement insurance) if you have Part C.

Part D (prescription drug coverage) is voluntary and the costs are paid for by the monthly premiums of enrollees and Medicare.  Unlike Part B in which you are automatically enrolled and must opt out if you do not want it, with Part D you have to opt in by filling out a form and enrolling in an approved plan.


Bill Loughead
We make Medicare seem easy!
1-888-40-Summit (888-407-8664)
info@summitmedigap.com

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