Original Medicare can feel like navigating a complex maze, especially for those new to the system. Understanding what it covers, how it works, and what its limitations are is crucial for making informed healthcare decisions. This guide breaks down Original Medicare (Parts A and B) into manageable parts, empowering you to confidently manage your healthcare needs.

What is Original Medicare?

Overview of Medicare Parts A and B

Original Medicare is the foundational health insurance program provided by the federal government. It consists of two main parts: Part A (Hospital Insurance) and Part B (Medical Insurance). Together, they cover a significant portion of your healthcare expenses, but it’s essential to understand their distinct roles.

• Part A (Hospital Insurance): This covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care.
• Part B (Medical Insurance): This covers doctor’s visits, outpatient care, preventive services, and durable medical equipment.

Eligibility for Original Medicare

Generally, you are eligible for Original Medicare if you are a U.S. citizen or have legally resided in the U.S. for at least 5 years and meet one of the following criteria:

• You are 65 years or older and you or your spouse has worked for at least 10 years (40 quarters) in Medicare-covered employment.
• You are under 65 and have received Social Security disability benefits for 24 months.
• You have End-Stage Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS).

• Example: Sarah turned 65 and has worked for 42 quarters (over 10 years) in a job where she paid Medicare taxes. She is automatically eligible for Part A and can enroll in Part B.

Enrollment Periods

Understanding the enrollment periods is vital to avoid penalties and ensure timely coverage.

• Initial Enrollment Period (IEP): This is a 7-month period that begins 3 months before the month you turn 65, includes your birthday month, and ends 3 months after your birthday month.
• General Enrollment Period (GEP): This runs from January 1 to March 31 each year. It’s for those who didn’t enroll in Part B during their IEP. Coverage begins July 1 of the year you enroll. Late enrollment penalties may apply.
• Special Enrollment Period (SEP): This allows you to enroll in Medicare outside of the IEP or GEP if you have qualifying life events, such as losing employer-sponsored health insurance.

• Actionable Takeaway: Mark your IEP on your calendar to ensure you enroll on time. If you miss the IEP, understand the GEP and potential penalties.

What Does Medicare Part A Cover?

Inpatient Hospital Stays

Part A primarily covers services you receive during an inpatient hospital stay.

• Covered Services: This includes room and board, nursing care, lab tests, medical appliances, and medications administered as part of your treatment.
• Deductibles and Coinsurance: You typically pay a deductible for each benefit period (a period starting when you are admitted as an inpatient and ending 60 days after you are discharged). Coinsurance may also apply for longer hospital stays.
• Example: John has a heart attack and is hospitalized. Part A covers his hospital room, nursing care, medications administered at the hospital, and lab tests. He pays the Part A deductible for that benefit period.

Skilled Nursing Facility (SNF) Care

Part A covers SNF care under specific conditions.

• Requirements: You must have had a qualifying hospital stay of at least 3 days, and you must enter the SNF within 30 days of your hospital discharge for a condition related to your hospital stay.
• Coverage Duration: Part A covers 100% of your SNF costs for the first 20 days. For days 21-100, you pay a daily coinsurance. After day 100, you are responsible for all costs.
• Example: Mary breaks her hip and spends 5 days in the hospital. After being discharged, she needs physical therapy and rehabilitation. She goes to a Medicare-approved SNF. Part A covers the first 20 days in full, and she pays a coinsurance for days 21-100.

Hospice Care

Part A covers hospice care for terminally ill individuals.

• Eligibility: You must be certified by a doctor as having a terminal illness with a life expectancy of 6 months or less.
• Covered Services: This includes doctor services, nursing care, medical equipment, prescription drugs for pain relief, and other services to manage your symptoms.
• Example: Robert is diagnosed with terminal cancer and chooses hospice care. Part A covers the costs of his hospice services, allowing him to receive care and support at home.

Home Health Care

Part A covers certain home health services if you meet specific criteria.

• Requirements: You must be homebound, require skilled nursing care or therapy, and have a doctor’s order for home health services.
• Covered Services: This includes part-time or intermittent skilled nursing care, physical therapy, occupational therapy, and speech-language pathology.
• Example: Elizabeth has a stroke and needs physical therapy to regain her mobility. A doctor orders home health services, and Part A covers the cost of a physical therapist visiting her home.

• Actionable Takeaway: Understand the requirements for SNF and home health care to ensure you qualify for Part A coverage when you need it.

What Does Medicare Part B Cover?

Doctor’s Visits and Outpatient Care

Part B primarily covers medical services received from doctors and in outpatient settings.

• Covered Services: This includes doctor visits, specialist consultations, diagnostic tests (like X-rays and blood tests), and outpatient surgeries.
• Deductibles and Coinsurance: You typically pay an annual deductible, and then Medicare generally pays 80% of the approved amount for covered services. You pay the remaining 20% (coinsurance).
• Example: David visits his doctor for a check-up. Part B covers the doctor’s visit after he meets his annual deductible. He pays 20% of the Medicare-approved amount for the visit.

Preventive Services

Part B emphasizes preventive care to help you stay healthy.

• Covered Services: This includes annual wellness visits, screenings for cancer, diabetes, and heart disease, as well as vaccinations like flu and pneumonia shots.
• Benefit: Many preventive services are covered at 100% with no cost-sharing.
• Example: Maria gets a mammogram as part of her annual preventive screening. Part B covers the entire cost of the mammogram because it’s a preventive service.

Durable Medical Equipment (DME)

Part B covers DME that is medically necessary and prescribed by your doctor.

• Covered Items: This includes wheelchairs, walkers, oxygen equipment, and hospital beds.
• Requirements: The DME must be prescribed by a doctor, and you must obtain it from a Medicare-approved supplier.
• Example: Robert needs a wheelchair due to mobility issues. His doctor prescribes a wheelchair, and Part B covers 80% of the cost after he meets his deductible.

Mental Health Services

Part B covers outpatient mental health services.

• Covered Services: This includes visits to psychiatrists, psychologists, and licensed clinical social workers. It also covers partial hospitalization programs.
• Cost-Sharing: Typically, you pay 20% of the Medicare-approved amount for mental health services after meeting your deductible.
• Example: Susan sees a therapist for anxiety. Part B covers a portion of the cost of her therapy sessions.

• Actionable Takeaway: Utilize preventive services to stay healthy and potentially avoid costly medical treatments later on.

What Original Medicare Doesn’t Cover

Common Exclusions

It’s crucial to understand what Original Medicare doesn’t cover.

• Most Dental Care: Original Medicare generally doesn’t cover routine dental care like cleanings, fillings, or dentures.
• Vision Care: Routine eye exams, eyeglasses, and contact lenses are typically not covered.
• Hearing Aids and Hearing Exams: Original Medicare usually doesn’t cover hearing aids or hearing exams for fitting them.
• Long-Term Care: Custodial care or long-term care services are generally not covered.
• Cosmetic Surgery: Procedures performed solely for cosmetic reasons are not covered.

Ways to Supplement Original Medicare

Given the gaps in Original Medicare coverage, many people choose to supplement it.

• Medicare Supplement Insurance (Medigap): These policies are sold by private insurance companies and help pay for some of the costs that Original Medicare doesn’t cover, like deductibles, coinsurance, and copayments.
• Medicare Advantage (Part C): These plans are offered by private insurance companies and provide all of your Part A and Part B coverage. Many Medicare Advantage plans also offer additional benefits, such as dental, vision, and hearing coverage.
• Employer-Sponsored Insurance: Some retirees have access to health insurance through their former employers, which can supplement Original Medicare.

• Example: Lisa enrolls in a Medigap policy to cover her Part B coinsurance and deductible, providing her with more predictable healthcare costs. Mark enrolls in a Medicare Advantage plan that includes dental, vision, and hearing benefits, addressing some of the gaps in Original Medicare.

• Actionable Takeaway: Evaluate your healthcare needs and budget to determine the best way to supplement Original Medicare. Consider Medigap, Medicare Advantage, or employer-sponsored insurance.

Costs Associated with Original Medicare

Part A Costs

Part A has costs, despite it being “premium-free” for most.

• Premium: Most people don’t pay a monthly premium for Part A because they or their spouse have worked and paid Medicare taxes for at least 10 years (40 quarters).
• Deductible: In 2024, the Part A deductible for each benefit period is $1,600.
• Coinsurance: For hospital stays longer than 60 days within a benefit period, you may have coinsurance costs. For skilled nursing facility (SNF) stays, coinsurance applies after day 20.

Part B Costs

Part B requires monthly premiums, and often coinsurance.

• Premium: The standard monthly Part B premium in 2024 is $174.70. Higher-income individuals may pay a higher premium.
• Deductible: In 2024, the annual Part B deductible is $240.
• Coinsurance: After meeting your deductible, you typically pay 20% of the Medicare-approved amount for most Part B services.

Late Enrollment Penalties

Failing to enroll during your Initial Enrollment Period can result in penalties.

• Part A Penalty: If you don’t qualify for premium-free Part A and don’t enroll when you’re first eligible, your monthly premium may increase by 10%. You’ll have to pay this higher premium for twice the number of years you could have had Part A but didn’t enroll.
• Part B Penalty: If you don’t enroll in Part B when you’re first eligible, your monthly premium may increase by 10% for each full 12-month period you could have had Part B but didn’t enroll. You’ll have to pay this penalty for as long as you have Part B.

• Example: Emily delayed enrolling in Part B for 3 years (36 months). Her Part B premium will increase by 30% for as long as she has Part B.

• Actionable Takeaway: Be aware of the costs associated with Original Medicare, including premiums, deductibles, and coinsurance. Avoid late enrollment penalties by enrolling during your IEP.

Conclusion

Original Medicare provides essential health insurance coverage, but understanding its components, limitations, and associated costs is essential for effective healthcare planning. By knowing what Parts A and B cover, what they don’t, and how to supplement them, you can make informed decisions about your healthcare and ensure you have the coverage you need. Take proactive steps to enroll on time, explore supplemental coverage options, and stay informed about changes to the Medicare program to maximize your benefits and minimize your out-of-pocket expenses.