how medicare works

The Two Parts of Medicare

There are two parts to Medicare:

Part A:

• Part A: Hospital Bills  Part A of Medicare covers your hospital bills (Room and Board). Think about the bed and four walls.
• You automatically get this when you turn 65 if you or your spouse worked for 10+ years and paid Medicare taxes.

Part B: Medical 

• These are doctors you see in the hospital, your PCP and specialist, medical tests, surgeries, etc.
• Part B starts the 1^st day of your birthday month and will be about $164.90 a month. Now with that $164.90, there are a few options to pay for this. Are you currently drawing social security or planning on drawing? (Based on the client’s situation explain which scenario applies)
• If Drawing or Planning on Drawing Social Security: Taken out monthly from the Social Security check before you receive it.
• If Not Drawing Social Security: Will be billed quarterly.
• (May not apply to everybody) It is important to know that there is a 10% penalty for each full 12-month period you did not have Part B.

 Step Three: How Medicare works:

• You can go to any Doctor, any Hospital nationwide that accepts Medicare.
• Which means you can keep your doctors.
• You do not have to ask permission to see a specialist.

Original Medicare by itself does not cover everything. It has its own out-of-pocket costs. Think of it like a piece of Swiss cheese.

For example:

With Part A: Every time you go to the hospital you will pay the first $1,600 before Medicare will pay. This is not per year but per occurrence. If you go to the hospital whether you stay a day or a month you will be billed $1600 for that stay.

With Part B: You are responsible for the first $226 of your medical expenses. This is known as your Part B deductible. The Medicare Part B deductible is an annual deductible and everyone on Medicare is responsible for paying it. Once the deductible is met, Medicare will cover 80% of your medical expenses, then you’re responsible for the other 20%. The scary part about your 20% responsibility is that there is NO CAP! Which means your exposure is unlimited! For example: Let us say you had a bad health year, and your medical bills are $100,000 you would be responsible for 20% of that which would be $20,000

Step Four: Transition:   – Now here are your options

Medicare created TWO great options for you to choose from, Medicare Advantage Plan or Medicare Supplements. It just depends on the coverage that works best for you.

Contact Us to Help you decide which program is right for you