Medicare is a health insurance program offered by the United States for individuals over the age of 65 who meet certain inclusion criteria as well as individuals of any age, who suffer from end stage kidney disease. was signed into law in 1965 by President Johnson as amendments to the Social Security legislation. In 1973 coverage for disabled individuals was added as a beneficiary of Medicare.
Traditionally Medicare has 2 parts. Medicare Part A and Part B,
Part A is basically hospital insurance. It helps pay for hospital costs, skilled nursing facilities, and / or hospice care.Most people automatically receive Part A upon turning 65 years old. There is no premium that the recipient must pay as a certain percentage of their wages,was taxed during the persons employed years to help cover this cost.
Part B is medical insurance. It helps pay for doctors visits, outpatient hospital care, physical or occupational therapy and some home health care.
In contrast to Part A which is given to a recipient automatically, you must sign up for Part B if you want it. Enrollment occurs during a 7 month period which starts 3 months before the individual turns 65, by contacting the social security office and signing up.
Participating in part B is a choice. Unlike Part A which has no premium, Part B does have monthly cost to beneficiaries. As of 2008, the Part B premium was $96.40/ month. This amount was likely to be adjusted and increase for 2009 due to the increase health care expenditure faced by Medicare. Additionally the monthly premiums may be higher for those individual who are above a certain income level.
Premiums are usually taken out of the monthly social security payments. Persons who do not receive social security payments will otherwise be billed by Medicare every 3 months for the premium amounts.
Medicare does not cover all medical costs incurred but rather a portion. Typically 70-80% of medically necessary costs of those services covered will be paid by Medicare. The remainder of the costs is known as co payments and is the responsibility of by the individual.
With the passage of the Medicare Modernization Act in 2003, another service was created or offered for Medicare beneficiaries known as Part D which is a prescription drug benefit plan. Additionally the Medicare Advantage Plan (formerly known as Medicare + Choice) was created for the purpose of having Medicare beneficiaries enrolled into managed care plans like HMO's. Medicare Advantage Plans, sometimes referred to as Medicare Part C, are health options plans approved by Medicare and run by private companies, many of whom are "for profit". Some Medicare Advantage Plans may eliminate or offer reduced premiums, deductibles or co-pays than traditional Medicare, and may cover more benefits than traditional Medicare. With the increasing options however, increased confusion for the consumer and many more ways for some to take advantage of the monies available and make obscene amounts of profits.
Medicare Health Plans include: HMO's, PPO's, PFFS, MSA's and Special Need Plans.