In our last two blog posts, we discussed the history of Medicare in the United States, from the first discussions of nationalized health insurance among labor activists in the Progressive Era to the status of Medicare today. In this blog post, we further our exploration of Medicare by comparing the four parts of the program: Medicare A, B, C, and D. As an insurance agent or company, it’s likely that your clients will ask you about the many facets of America’s federal health insurance program, and it is important to know the ins and outs of each one.
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Medicare Part A
Medicare Part A is part of Original Medicare, meaning that it was implemented on July 30, 1965, when President Lyndon B. Johnson enacted Medicare under Title XVIII of the Social Security Act as a way to provide health insurance to people age 65 and older. Medicare Part A is sometimes referred to as “hospital insurance” or “hospice insurance,” since it covers inpatient stays where the beneficiary has been formally admitted to a hospital or hospice. This includes coverage for semi-private rooms, food, and tests. Medicare Part A is the only part of Medicare that most Americans ages 65 and older can receive premium-free.
The maximum length of hospital stay covered under Medicare Part A is typically 90 days, with the first 60 days paid by Medicare in full, except for one deductible at the beginning of the 60 days and a copayment per day thereafter. Medicare penalizes hospitals for readmissions, which are common; a study of 18 states conducted by the Agency for Healthcare Research and Quality found that 1.8 million Medicare patients ages 65 and older were readmitted within 30 days of an inpatient hospital stay in 2011. The goal of penalized readmission is to encourage better post-hospital care, and increase referrals to hospices and end-of-life care in lieu of treatment. Part A fully covers brief stays for rehabilitation or convalescence in a skilled nursing facility and up to 100 days at such facilities if certain criteria are met. Hospice benefits are completely covered under Medicare Part A for terminally ill persons with less than six months to live.
Medicare Part B
Medicare Part B is also part of the Original Medicare program enacted in 1966. Medicare Part B helps beneficiaries pay for services and products not covered by Medicare Part A, generally on an outpatient basis. Unlike Medicare Part A, Medicare Part B is optional, and it is often deferred if the beneficiary or their spouse is still working and has group health coverage through their employers. There is a lifetime penalty of 10% per year on the premium for not enrolling in Medicare Part B when first eligible.
Coverage under Part B begins once a patient meets their deductible, which is typically low ($198 in 2020), with Medicare covering 80% thereafter for all approved services and products. Beneficiaries may get Medicare Supplement (sometimes referred to as “Medigap”) to cover the additional 20%, or they can pay out-of-pocket. The monthly premium for Medicare Part B is $144.60 (or higher depending on the beneficiary’s income) as of the writing of this article.
Part B coverage includes outpatient physician services, visiting nurse services, x-rays, labs and diagnostic tests, blood transfusions, renal dialysis vaccinations,, outpatient hospital procedures, chemotherapy, and many other outpatient treatments. Part B also helps cover durable medical equipment (DME), such as canes, walkers, lifts chairs, wheelchairs, and mobility scooters.
Medicare Part C
Also known as Medicare Advantage, Medicare Part C is the private sector component of Medicare. Under a Medicare Advantage plan, beneficiaries receive everything they would under Medicare Part A, B, and D, as well as additional benefits not covered under the government program, such as vision care, dental care, annual physicals, and even such luxury services as health club memberships. The premium for Medicare Advantage varies according to the specific plan. Most Part C plans are traditional health maintenance organizations (HMOS), though others are preferred provider organizations. While adults with Medicare Advantage plans get to enjoy many more benefits than those with Original Medicare, they often have a more limited provider network.
Enrollment in Medicare Advantage grew from about 1% of total Medicare enrollment in 1997 when Part C first started to about 37% in 2019. With the percentage of adults opting for Medicare Advantage plans on the rise, there is no better time than the present to get involved in the lucrative and life-changing business of selling Medicare Advantage plans to adults ages 65 and older. With Need-A-Lead, you can receive high-quality Medicare Advantage leads at a lower price than you ever thought possible.
Medicare Part D
Medicare Part D went into effect on January 1, 2006 as a way to help older adults receive prescription drug coverage. Anyone enrolled in Medicare Part A or B is eligible for Medicare Part D, which covers mostly self-administered drugs. Unlike Original Medicare, Medicare Part D is not standardized, though it is highly regulated by the Centers for Medicare and Medicaid Services. Plans vary in terms of which drugs they cover, but most cover all or “substantially all” drugs in the following protected classes: anti-cancer, antipsychotic, anticonvulsant, antidepressant, immunio-suppressant, and HIV and AIDS drugs.
Approximately 25 states offer additional prescription drug coverage on top of Part D, and the federal Social Security Administration offers an Extra Help program to lower-income seniors so that they have almost no drug costs. The Part D monthly premium varies by plan, with high-income consumers sometimes paying more.
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While Medicare has undoubtedly enhanced the lives of adults ages 65 and older in the United States, it often doesn’t cover everything that a person needs during this vulnerable time in their life. Thankfully, plans such as Medicare Advantage and Medicare Supplement can fill in the gaps. When you choose Need-A-Lead for your insurance lead generation campaign, you can rest assured that you are getting 100% exclusive leads sourced from the best data available anywhere. Sign up for a free quote now to get started.