When one turns the magic age of 65 it seems that every insurance company in the world sends their invitation to participate in one of the many Medicare Supplement, Medicare Advantage, and Prescription Drug programs. Of course this can be overwhelming to any senior citizen.
Medicare is a healthcare program for individuals 65 and over and for some disabled individuals under 65. Medicare is not designed to pay 100% of one’s medical expenses. Beneficiaries encounter deductibles, coinsurance, and copayments that must be met when receiving benefits through the Medicare program.
Part A of Medicare for the year 2016, a person entering the hospital with only Medicare they initially must pay
For Medical care (Part B) there is an annual deductible. It is currently $166. After which Medicare will make payments based on the “Approved Amount”. This is not usually the amount charged by a provider, and can be less than normally charged. Once Medicare establishes the approved amount, payment is made based on an 80/20 percent of the approved amount formula. Medicare makes payment of 80% and the beneficiary is responsible of the remaining 20%, plus any excess charges. This is an amount that can be charged by the provider and can be another 15% over the approved amount.
Medicare does not cover long term care as a portion of their program. However skilled care is provided following a three day hospital stay. Normally the first 20 days are provided at no cost, and a daily payment of $161 is required of the insured for the next 80 days. After one hundred days Medicare no longer pays for skilled care. This skilled care benefit often causes Medicare beneficiaries to incorrectly believe they have nursing home insurance through Medicare.
This is only a brief synopsis of the program and does not include all the options and coverage’s offered by Medicare. So with all this information and all the mail adding confusion, what should the new Medicare beneficiary do? Our suggestion is for them to contact the State SHIP program or seek the advice of a qualified Medicare insurance agent to decipher the mass mailings by companies and to discuss the Medicare program and supplemental insurance options in detail.