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THE FOUR PARTS OF MEDICARE
- Braden Medicare Insurance
- Aug 22, 2024
- 3 min read
Updated: Jan 5
Michael T. Braden, August 27, 2024 THE FOUR PARTS OF MEDICARE
BACKGROUND OF MEDICARE IN AMERICA
Medicare is the national health insurance program for everyone in the United States aged 65 and older. Medicare is part of the United States Department of Health and Human Services. Everyone enrolls in Medicare through the Social Security Administration. Once they are approved and enrolled in a Medicare Plan, their Healthcare is managed by Medicare. Some Americans with disabilities may be eligible for Medicare before age 65.
President Harry S. Truman first envisioned Medicare; however, it did not become law until 1965, when President Lyndon B. Johnson signed it into Law. Harry and Bess Truman were the first two Medicare Beneficiaries in the United States. Today, Medicare has 4 Parts (A, B, C & D)
Medicare is the most extensive Health Program in the United States. It serves over 64 million Americans, and for all of the Medicare jokes you may have heard, Medicare really is FANTASTIC healthcare, and you get to customize how you want your Medicare to work for you.
Original Medicare has always consisted of Two Parts, Medicare Part A and Medicare Part B, since Lyndon Johnson signed it into law. Then, under Bill Clinton, Medicare introduced the third part of Medicare, Medicare Part C. Initially referred to as Medicare Choice at the time, it later became known as Medicare Advantage. Lastly, George W. Bush added the final component of Medicare, Medicare Part D, which covers Prescription Drug plans.
We are going to jump in and provide some information, I hope it is simple, about the Four Parts of Medicare.
THE FOUR PARTS OF MEDICARE AND WHAT MEDICARE PART A COVERS
MEDICARE PART A
Covers Hospitalization Costs, Skilled Nursing Care, and Hospice Care. Medicare Part A is basically free to 99% of those enrolled in Medicare. This is what we pay for during our working careers in Medicare and Social Security taxes.
MEDICARE PART B
Cocentervers Outpatient Services, surgical centers, doctor visits, Lab Work, Diagnostics, Durable Medical Equipment (DME), and Treatments received as an Outpatient in a Hospital or Doctor's Office. Some Prescriptions are also included under Part B, but only those that a physician, RN, or NP must administer. Medicare Part B costs EVERYONE $170.10 per month in 2022. This amount applies regardless of the plan selected; everyone is charged this amount, and many must pay a higher Part B premium if they are considered "High Wage Earners."
THE FOUR PARTS OF MEDICARE & WHAT MEDICARE PART B COVERS
THE FOUR PARTS OF MEDICARE & WHAT MEDICARE PART C COVERS
MEDICARE PART C
Originally named Medicare Choice (That Is Where Part C Came From). These are known as Medicare Advantage Plans. Instead of your Medicare being a Government Health Plan, Medicare Advantage plans are offered by private insurers.
Medicare Advantage Plans were designed to give Medicare Beneficiaries an alternative to Original Medicare. Medicare Part C and Medicare Part D plans are the same. While these plans are required to cover the same benefits as Original Medicare, they do so in different ways, and ultimately, the decisions are made by the Insurance company.
Medicare Advantage plans offer a variety of "Extra" or "Additional" benefits not provided by Medicare. These benefits include Dental, Vision, and hearing coverage; transportation to medical appointments; an OTC subsidy; a credit toward your Part B premiums; and assistance with groceries and utilities. How can they do this? The Government pays Medicare Advantage Insurance companies $12,000 annually for each Medicare beneficiary enrolled in one of their plans. This is also where the money comes from for all their advertising and commercials.
Medicare Part C plans all have an MOOP. MOOP stands for Maximum-Annual-Out-Of-Pocket amount. If the plan you like has a $5,000 MOOP, it means you would need to pay $5,000 out of pocket in the form of Copayments and Coinsurance before your plan pays 100% of your Healthcare Costs. Because every Medicare Advantage (MA) plan is based on a Calendar Year, the MOOP resets on January 1st each year.
THE FOUR PARTS OF MEDICARE & WHAT MEDICARE PART D COVERS
MEDICARE PART D
Covers Prescription Drugs and Prescription Medications. Typically, you choose the best, lowest-priced Prescription Drug Plan (PDP), which includes a premium and the costs of your medications. You may change these plans annually if your medications have changed during the previous year.
