Medicare, like standard health insurance can be very confusing, especially if you don’t know what half the words mean.
- Part A: Hospital insurance– helps pay for hospice care, inpatient hospital care, and skilled nursing facility care. Individuals are entitled to Part A if they contributed payroll taxes for 10 years or more while they worked.
- Part B: Supplementary Medical Insurance– helps pay for physician services, outpatient care, preventive services, x-rays, diagnostic tests, and mental health services. It is funded primarily by premiums.
- Part C: Medicare Advantage– provides care through managed care plans. Plan C provides Parts A, B, and D benefits.
- Part D: Prescription drug plan– enrollment is voluntary and is provided by private prescription drug plans or Medicare Advantage prescription drug plans.
- Medigap– refers to private supplemental health insurance plans sold to Medicare beneficiaries. It covers medical expenses that may not be covered by the Original Medicare plan.
- Original Medicare– a fee-for-service plan that covers many health care services and drugs but doesn’t pay for all health care costs. There are costs such as coinsurance, copayments, and deductibles that you must pay. It includes Medicare Part A and Medicare Part B.
- Monthly premium– a monthly payment to Medicare, an insurance company, health care plan or drug plan for health coverage.
- Annual deductible– The amount you pay for medical services and prescriptions before your health insurance plan or Medicare plan kicks in and begins to pay.
- Coinsurance– The amount you may be required to pay for services after you pay any deductibles.
- Copayment– an amount you pay for services such as a doctor’s visit or specialist visits regardless of whether you have fully paid your deductible.
These are just some of the terms you should be familiar with when you are dealing with your Medicare plan or when you are choosing a Supplemental Medicare plan. They can help you to better understand the process and make an informed decision about the right plan to choose. Other ways to stay informed is to talk to your health insurance representative or carrier and stay current with insurance news.