Part A
What is it? The first half of the Original Medicare Plan is known as Part A. It is basically a hospital insurance policy. Part A covers a hospital stay as well as hospice care, certain mental health services, blood transfusions, and a very limited amount of nursing home or in-home care. For specifics on Part A coverage details, please refer to our Medigap Comparison Table.
Part A does not provide for a private hospital room or for telephone or television in the room. It also will not pay for an extended stay in a nursing home (or in an assisted-living facility) or for in-home care that is not considered “skilled” (assistance with cooking, cleaning, bathing, for example). Preventive health care, such as regular check-ups, are also not covered.
Who qualifies? People age 65 or older qualify. It’s best to apply in the ten months before your 65th birthday. Younger people with disabilities or those with renal disease may also qualify. Eligibility can be assessed and processed through the Social Security Department.
Cost? Most people don’t have to pay for Part A. This is because either they or their spouse already paid, in the form of Medicare taxes at work.
If you didn’t pay Medicare taxes for at least ten years (through work), you can buy Part A. The monthly premium is $393.00 in 2006. Those with limited income or resources may find assistance through their state. Contact the Social Security office for more information.
Additional costs: For each hospital visit, there is a $812 deductible (for the first 60 days). This is the amount you pay before the Medicare coverage starts. If you need to stay an additional 30 days, there is a $203-a-day co-payment for that period. Again, the co-payment is the amount you pay. For time spent in a nursing home, you pay a $105.50-per-day co-payment for all days over 21 (and up to 100).
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Part B
What is it? The other half of the Original Medicare Plan is called Part B. This is an optional plan for which you pay a monthly premium. It covers some of the areas Part A doesn’t cover such as outpatient physical therapy, flu shots, and preventive screenings (including mammograms, prostate cancer tests, etc.). For more details, please see the table.
Who qualifies? People age 65 or older qualify. It’s best to apply in the ten months before your 65th birthday. Younger people with disabilities or those with renal disease may also qualify. Eligibility can be assessed and processed through the Social Security Department.
Cost? Everyone who wants Part B must pay for it. In 2006, the monthly premium is $88.50. If you receive Social Security benefits, this amount will be deducted from your check. If you don’t get these benefits, Medicare will bill you every three months.
If you want Part B coverage, it’s best to sign up as soon as you’re eligible (the year of your 65th birthday). The cost of the plan goes up 10% for each year you postpone signing up.
Some people already have sufficient medical insurance through their or their spouse’s work (or by way of COBRA). In these cases, it’s important to check with Medicare to know how your Part B enrollment rights are affected.
Additional costs: In 2005, the deductible amount for Part B was $110.00. In addition, you pay 20% of all costs—because the Plan covers 80%— or in some cases 50%, when the Plan covers 50%. As with Part A, those with limited income or resources may find assistance through their state.
Many doctors “accept assignment,” that is, they agree to charge you what Medicare will pay for a given service. If, however, a doctor does not accept assignment, you are then responsible for any charges above the approved Medicare cost.
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