Medicare Options



Medicare has two components - Part A and Part B. Part A of Medicare covers hospital related expenses and is called Hospital Insurance, while Part B pays for professional services, lab, x-ray, outpatient services, etc and goes by the name of Medical Insurance . Part A you automatically qualify for when you turn age 65 providing you have 40 quarters of Medicare qualified employment completed or are permanently disabled. Part B requires that you actually enroll if  you are not already receiving social security benefits at the time you turn age 65. There is a premium payable for Part B, which for the 2019 calendar year will be $135.50 for all those with annual incomes below $85,000 (individuals) and $170,000 (joint).  For those individuals or couples with incomes above these limits, they will pay a higher premium based on specified income brackets.

For 2019, Part A has a deductible of $1364.00 while Part B has a deductible of $185.00. After the Part A deductible is satisfied, Medicare pays 100% of hospital related expenses for the first 60 days of a confinement. For days 61 through 90 of a hospitalization, the insured pays a co-pay of $341.00 a day. After 90 days, the co-pay increases to $682.00 per day thru 150 days. After 150 days, the patient pays all hospital costs.

Part B pays for professional charges, outpatient hospital services, and to a limited extent, Home Health Care. After the $185.00 annual deductible is satisfied, Medicare pays 80% of approved charges. The patient is responsible for 20% of approved amounts plus any amounts over and above the approved charges. There is no out of pocket maximum for the insured.

Medicare Supplement

Medicare Supplements, sometimes called Medigap Insurance, cover the "gaps" in original Medicare, such as deductibles, coinsurance, and copayments. Each Medicare Supplement has an associated letter signifying which plan you have, currently these letters run from A to N. Each Medicare Supplement offers different levels of coverage. However, beginning June 1, 2013, the MIPPA law of 2008 took effect and made changes to Medicare coverages and Medicare Supplements. As of June 1, 2013, the E, H, I, and J Supplements were discontinued making the F Supplement the most complete. MIPPA also implemented two new Medicare Supplements, the M and N Supplements. Lastly, MIPPA removed coverage for At-Home Recovery Services, but added Hospice Care and Preventive Care Coinsurance benefits to all Medicare Supplements.

Medicare Advantage

Medicare Advantage, sometimes referred to as Medicare Part C, is health insurance for those who qualify for Medicare. Instead of claims being paid by Medicare and a Medicare Supplement (if enrolled in one), an insurance company pays your claims. Typically these plans are designed as PPOs, HMOs, or Private Fee For Service (PFFS) and often include benefits in addition to what Medicare traditionally covers, such as dental, vision, and prescription medications.

Medicare Part D

Medicare Part D is prescription drug coverage for those who are entitled to Medicare Part A and/or enrolled in Medicare Part B. These plans are sold by different insurance companies across the country and usually have low or no deductible and low copayments for generic and brand name medications. For the 2019 plan year here are the important limits –

Deductible Initial Coverage Limit Doughnut Hole Catastrophic Coverage
For 2019, the standard plan deductible for Part D is $415.  The initial coverage limit is $3820 and catastrophic coverage begins after the insureds goes $5100 out of pocket.  The out of pocket maximum is made up of 100% the insured’s copays, deductibles, and the manufacturer’s discounts they receive while in the coverage gap (donut hole). Once the out of pocket maximum is reached (catastrophic level), the insured pays the greater of the 5% of the cost of the drug or either $3.35 for generics and $8.35 for all other drugs.

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