Medicare - What is it? What is Hospital Insurance? And what is Medical Insurance?

Part A: Hospital Insurance
Part B: Medical Insurance
SUMMARY OF MEDICARE BENEFITS AND COST-SHARING FOR 2012

Medicare is a Federal health insurance program. It covers most people 65 years old and over, some people younger than 65 with disabilities, people diagnosed with amyotrophic lateral sclerosis (ALS), and those with end-stage renal disease (ESRD).

Medicare is divided into several parts. This fact sheet discusses: Part A, Hospital Insurance and Part B, Medical Insurance. For more information on Medicare Part C (Medicare Advantage Plans) and Part D (the prescription drug benefit), please see our fact sheets Medicare Advantage Overview and Part D Overview at cahealthadvocates.org.

Part A: Hospital Insurance
Part A covers most in-patient hospital care, some in-patient skilled nursing facility care, some home health care, and hospice care.

There is no monthly Part A premium for people who have 40 or more quarters of Social Security credits (about 10 years of full-time work with four quarters per year) and who are eligible for Social Security or Railroad Retirement benefits. People insufficient Security quarters may buy Part A and pay a monthly premium of $451.00 (for 2012).

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Part B: Medical Insurance
Part B covers a portion of the Medicare approved costs for out-patient medical services such as doctors' services, out-patient hospital care, laboratory tests, out-patient physical and speech therapy, some home health care, ambulance services, and some medical equipment and supplies.

Part B coverage is optional. If you or your spouse are still working and you are covered by your employer group health plan, you may not need this part of Medicare until you or your spouse retire. (See our fact sheet Coverage After 65 if You or Your Spouse Works). For people who enroll in Part B and receive Social Security, the Part B monthly premium ($99.90 in 2012, for beneficiaries with individual incomes of $85,000 or less) is automatically deducted from their Social Security check every month. For people who do not receive Social Security, they will be billed quarterly for Part B. Medicare does not offer comprehensive coverage. Even though it pays for some preventive services and covers most medically necessary services, Medicare pays for less than half of what it typically costs beneficiaries for all of their health care expenses. Some examples of items that Medicare will not pay for are: hearing aids, eyeglasses, dental care and long term care at home or in a nursing home, when the care you need is primarily personal care services/custodial care.

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SUMMARY OF MEDICARE BENEFITS AND COST-SHARING FOR 2012

Service Provided Medicare Pays You Pay Part A: Hospital Insurance Hospital Inpatient Days 1-60 Everything after deductible $1,156 deductible Days 61-90 Everything after co-payment $289 per day co-payment 60 Reserve Days 91-150 Everything after co-payment $578 per day co-payment Beyond 150 Days Nothing All costs for each day beyond 150 Days Psychiatric Hospital Same as hospital inpatient but 190 day lifetime limit All costs after 190 days Skilled Nursing Facility (SNF) (if daily skilled care is needed after a three day hospital stay Days 1-20 All Nothing Days 21-100 All after co-payment $144.50per day co-payment After 100 Days Nothing All Home Health Care All except 20% of covered medical equipment 20% of Medicare Approved amount for medical equipment Hospice (care of terminal illness) All except $5 per prescription and 95% of Medicare approved amount for respite care per day Co-payment of $5 per prescription and for respite care, 5% of Medicare payment for a respite care day, not to exceed $1,024 Blood (received during hospital or SNF stay) After 3 pints of blood The first 3 pints of blood each year

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Service Provided Medicare Pays You Pay Part B: Medical Insurance Monthly Premium This is the amount of the monthly Part B premium for individuals who have an annual income of $85,000 or less and $170,000 or less for couples. 99.90 For individuals with incomes above $85,000 up to $107,000, or couples with incomes above $170,000 up to $214,000 $139.90 For individuals with incomes above $107,000 up to $160,000 or couples with incomes above $214,000 up to $320,000 $199.80 For individuals with incomes above $160,000 up to $214,000, or couples with incomes above $320,000 up to $428,000 $259.70 For individuals with incomes above $214,000 and couples with incomes above $428,000 $319.70 Annual Deductible $140/year Physician Costs 80% of approved amount 20% of approved amount Outpatient Hospital Care 80% of approved amount 20% of approved amount Clinical Lab Services Approved amount Nothing Medical Equipment/Supplies 80% of approved amount All other costs Some Preventive Serves (depending on the service, some are covered according to a time schedule, i.e. once a year) 80% or 100% 20% of approved amount or nothing, depending on the services Mental Health Services Partial Hospitalization Same as inpatient hospital See above under Part A Outpatient 55% of approved amount 45% of approved amount

2 - Plus up to an additional 20% of the Medicare approved amount if the doctor or supplier does not accept assignment.

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