Helping our patients understand Medicare
MEDICARE COVERAGE Q & A
- What is Medicare?
- What is Medicare Part A (Hospital Insurance)?
- What is Medicare Part B (Medical Insurance)?
- What are Medicare Part C (Medicare Advantage-formerly Medicare + Choice Plans)?
- What is Medicare Part D (prescription drug coverage)?
- Am I eligible for the Medicare prescription drug plan?
- Should I enroll in a Medicare prescription drug plan?
- When can I enroll?
- How do I enroll or change plans?
- What if I choose not to enroll?
- What are the costs?
- Is there help available if I can’t afford a Medicare prescription drug plan?
- How do I prepare to choose a Medicare prescription drug plan?
- What medications are covered?
- Is the plan I’m on the best option for me?
- Is there anything I can do to avoid the coverage gap?
- Where can I get more information?
What is Medicare Part A (Hospital Insurance)?
Medicare Part A helps cover inpatient care in hospitals, including critical access hospitals and skilled nursing facilities (not custodial or long-term care). It also helps cover hospice care and some home-health care. Beneficiaries must meet certain conditions to get these benefits.
Most people don't pay a premium for Part A because they or a spouse already paid for it through their payroll taxes while working.
What is Medicare Part B (Medical Insurance)?
Medicare Part B helps cover doctors' services and outpatient care. It also covers some other medical services that Part A doesn't cover, such as some of the services of physical and occupational therapists, and some home-health care. Part B helps pay for these covered services and supplies when they are medically necessary. Most people pay a monthly premium for Part B.
What are Medicare Part C (Medicare Advantage-formerly Medicare + Choice Plans)?
Medicare Part C is a type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits. Medicare Advantage Plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans and Medicare Medical Savings Account Plans. If you're enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan and aren't paid for under Original Medicare
What is Medicare Part D (prescription drug coverage)?
The Medicare prescription drug benefit offers coverage for brand-name and generic drugs to anyone eligible for Medicare. Coverage is provided through private insurance plans, and you can choose a plan that is right for you. Please note: You must enroll to get coverage.
- Entitled to Medicare benefits under Part A and/or enrolled in Part B
- A resident in the prescription plan's service area
- Not be enrolled in more than one Medicare Part D plan at a time
Should I enroll in a Medicare prescription drug plan?
You should enroll in a Medicare Prescription Drug Plan unless your current drug coverage is as good as (or better than) the Medicare prescription drug coverage available to you. This is called “creditable” coverage, and it is important that you join a plan when you are first eligible. You should contact your current plan provider to determine if you have creditable coverage. If you are eligible for Medicare and have Medicaid, you may be automatically enrolled in a prescription drug plan. Check with your state’s Medicaid department for more information.
- During your initial 7-month Medicare enrollment period (3 months before and 3 months after, as well as the month of, your 65th birthday)
- During the 3 months before and the 3 months after your 25th month of receiving disability benefits
- 63 days after your creditable insurance coverage ends or during the annual enrollment period, which runs from October 15 to December 7 each year
- Enroll on the Medicare Plan Finder at www.medicare.gov or on the plan's website.
- Complete a paper enrollment form.
- Call 1-800-MEDICARE (1-800-633-4227).
- When you join a Medicare drug plan, you'll give your Medicare number and the date your Part A and/or Part B coverage started.
- This information is on your Medicare card.
- You can change plans during the Medicare prescription drug program's annual enrollment period, which is from October 15 to December 7 each year. (Dual-eligible individuals — those with both Medicare and Medicaid — may change plans monthly, at any time throughout the year.)
What if I choose not to enroll?
If you don't join a Medicare drug plan when you're first eligible to join (during your initial enrollment period), you may have to pay a late-enrollment penalty when you join. This amount changes every year but is approximately 1% of the plan's premium price for each month you delay enrolling. In addition, you will have to pay a penalty as long as you have Medicare prescription drug coverage.
- Monthly premium
- Yearly deductible
- Co-payments or co-insurance
- Costs in the coverage gap
- Costs if you get Extra Help
- Costs if you pay a late-enrollment penalty
Your actual drug plan costs will vary depending on:
- The drugs you use
- The plan you choose
- Whether you go to a pharmacy in your plan's network
- Whether the drugs you use are on your plan's formulary
- Whether you get Extra Help paying your Medicare Part D costs
Is there help available if I can't afford a Medicare prescription drug plan?
Some people with limited income and resources will qualify for Extra Help. If you qualify, Social Security will help you pay for premiums and/or the cost of prescriptions. You can apply for Extra Help at any time, and there's no risk to submitting an application. To determine if you qualify, contact your local Social Security office, or visit www.ssa.gov for more details. To qualify for this subsidy in 2013, Medicare-eligible seniors must meet specific income guidelines:
- You may qualify for Extra Help if you have up to $15,079.50 annual income ($20,425.50 for a married couple).
The “Extra Help” benefit will also help seniors by reducing or eliminating out-of-pocket deductibles, copays and expenses associated with the coverage gap.
- Make a list of all of your current prescription drugs.
- Use the Medicare Plan Finder from www.medicare.gov to get a list of the plans that best meet your needs in the area you live.
- Visit your local fred’s Pharmacy to ask questions or request additional information from your fred’s Pharmacist. fred’s Pharmacy doesn't recommend any particular Part D plan, but we think it's important for you to take advantage of the annual enrollment period to find the plan options that are best for you.
- Apply for Extra Help if you have limited income and resources. There's no risk to submitting an application, and you can apply for Extra Help at any time throughout the year.
What medications are covered?
Following these steps can help prepare you to make a decision: Use the Medicare Plan Finder at www.medicare.gov to find out which medications are covered and the costs associated with each plan.
Is the plan I'm on the best option for me?
If you're currently enrolled in a Medicare Part D plan, you should think about a few things to decide if you are in “the right plan”. Each year, plan premiums, deductibles, prescription copayments and annual out-of-pocket expenses can change. These costs, as well as the list of covered drugs, vary from plan to plan and from region to region. You also need to remember that, in general, only the cost of Part D-covered drugs that are included on a plan's formulary count toward the deductible and out-of-pocket limits.
You should take time to review the various plans available to you in light of your current and anticipated prescription needs and financial resources. You may want to consider whether there is a different plan available that may be more suitable to your needs. Use the Medicare Plan Finder at www.medicare.gov to help compare.
Is there anything I can do to avoid the coverage gap?
In 2013, pharmaceutical companies will provide a 52.5% discount on brand-name drugs and a 21% discount on generic drugs filled during the coverage gap. Additional savings on generic prescriptions also are available during the coverage gap.
The 52.5% discount on brand-name drugs works as follows: 50% from the pharmaceutical copay, 2.5% from the Medicare Part D plan and 47.5% from the customer or beneficiary would be applied toward the total out-of-pocket cost through the coverage gap. So if a customer has a prescription drug that costs $400 a month at the agreed-upon price, $200 will be paid by the pharmaceutical company, $10 will be paid by the Medicare Part D plan and $190 by the beneficiary, but $400 will count toward the customer's total out-of-pocket expense.
Be advised: In order for the brand-name drug to be included, the pharmaceutical company must sign an agreement with Medicare. If there is no agreement for a particular drug, it is NOT entitled to the 52.5% discount.
Where can I get more information?
Each year, Medicare recipients receive the “Medicare & You” handbook. It includes more detailed information and is a good place to start. You also can visit: http://www.cms.gov/Medicare/Medicare-General-Information/MedicareGenInfo/index.html
*Note: This links to www.medicare.gov, a website hosted by the Centers for Medicare and Medicaid Services (CMS).
Call 1-800-MEDICARE (1-800-633-4227).