What is Medicare?

Medicare is a federal health insurance program. In order to qualify, you must be a U.S. citizen or lawfully present in the United States. You must also:

• Be age 65 or older, or
• Be under age 65 with certain disabilities, or
• Have permanent kidney failure requiring dialysis.

Medicare has four parts:

• Part A hospital coverage
• Part B medical coverage
• Part C Medicare Advantage plans
• Part D prescription drug plans

Part A hospital coverage

Most people do not pay a monthly premium for Part A. If you or your spouse worked for 10 years and paid Medicare taxes, you will not have to pay a premium.

Part A helps cover:

• Inpatient hospital care.
• Skilled nursing facility care.
• Home health care.
• Hospice care.

Your costs under Part A include:

• Inpatient hospital deductible.
• Inpatient hospital copays.
• Skilled nursing copays.
• Monthly premium, if applicable.

Part B medical coverage

Part B requires you to pay a monthly premium along with a yearly deductible before coverage begins. You are also responsible for paying part of the costs that Part B does not cover.

Part B helps cover:

• Doctor and other health care provider services.
• Outpatient surgery.
• Lab and x-ray services.
• Ambulance services.
• Preventive services.
• Durable medical equipment like prosthetics, wheelchairs, and hospital beds.

What costs are you responsible for under Part B?

• Your Medicare Part B monthly premium, if applicable
• Yearly deductible (paid before Medicare begins paying)
• Coinsurance (percentage of the cost that Medicare does not pay)

Services that are NOT covered by Medicare include:

• Routine hearing, dental, and vision exams.
• Hearing aids or glasses (except for glasses after cataract surgery).
• Emergency assistance while traveling outside the U.S.
• Fitness club membership.
• Long-term care (such as a nursing home).
• Prescription drug coverage.

Part C Medicare Advantage plans

Part C is referred to as Medicare Advantage plans. Medicare Advantage plans are Medicare-approved private health plans. Medicare Advantage plans work differently from Supplement plans. They allow you to get all of your Part A Hospital, Part B Medical, and, sometimes, Part D Prescription Drug coverage combined into one plan. They can also provide you with some additional benefits and services that Original Medicare does not cover.

When enrolled in a Part C Medicare Advantage plan, you can get coverage for:

• Medicare Part A (hospital coverage) and
• Medicare Part B (medical coverage).

To join a Medicare Advantage plan, you must:

• Be a U.S. citizen or lawfully present in the United States.
• Be enrolled in Medicare Parts A and B.
• Live for six months or more each year in the plan’s service area.
• Not have permanent kidney failure (some exceptions may apply).

Medicare Advantage plans help cover:

• All services that Parts A and B cover, except hospice care (which is covered by Medicare).
• Additional benefits and services that Medicare does not cover, such as:
  • Routine hearing, dental, and vision exams.
  • Hearing aids or glasses (except for glasses following cataract surgery).
  • Emergency medical assistance while traveling outside the U.S.
  • Fitness club membership.

Your costs when enrolled in a Medicare Advantage plan:

• Part A (if applicable) and Part B monthly premiums, if applicable
• Medicare Advantage plan monthly premium, if applicable
• Any out-of-pocket costs such as copays, deductibles, and coinsurance (these costs vary according to the plan you choose)

Medicare Advantage plans can have lower out-of-pocket costs than Original Medicare.

Two types of Medicare Advantage plans

• Health Maintenance Organization (HMO)
  
  • HMO plans use a network of participating hospitals and doctors for your care.
  • You must receive services from participating hospitals and doctors, except for emergency care, out-of-area urgent care, and out-of-area kidney dialysis.
  • Make sure your current doctors are included in the plan’s provider network before joining a plan.


• Preferred Provider Organization (PPO)
  
  • PPO plans offer coverage for services received both in and out of the plan’s provider network.
  • You may pay a higher coinsurance, copayment, or deductible for care received outside of the plan’s participating provider network.

Part D prescription drug coverage

Part D coverage is offered through Medicare-approved private insurance companies. You can receive Part D coverage through a prescription drug plan (PDP) or by including it in a Medicare Advantage prescription drug plan (MAPD).

Part D helps cover brand-name and generic medications. Prescription coverage varies by plan; each plan has a formulary that lists the drugs that are covered by that plan.

Your costs when enrolled in a Part D plan:

• Your Part D plan monthly premium, if applicable
• Any out-of-pocket costs such as copays, coinsurance, and deductibles included with the prescription drug plan that you choose
• A late enrollment penalty (this only applies if you have a period of 63 days without Part D coverage)

Stages of prescription drug coverage

Initial Coverage Stage
You pay: The deductibles, copays, and coinsurance for your prescription drug plan, as applicable.

Costs that apply in this stage: Your out-of-pocket costs plus the costs paid by your prescription drug plan. Once these costs reach $3,820, you move to the Coverage Gap Stage.

Costs that apply to the Catastrophic Coverage Stage: Only your out-of-pocket costs.

Coverage Gap Stage
You pay: A maximum of 37 percent of the cost for generic drugs and 25 percent of the total cost of brand-name drugs (plus a portion of the dispensing fees).

Costs that apply in this stage: Your out-of-pocket costs for generic drugs. Your out-of-pocket costs plus 70 percent of the total cost for brand-name drugs.

Costs that apply to the Catastrophic Coverage Stage: The costs that apply in this stage plus your total out-of-pocket costs from the Initial Coverage Stage. Once these costs reach $5,100, you leave the Coverage Gap Stage. This applies to all prescription drug plans.

Catastrophic Coverage Stage
You pay: A reduced copay or coinsurance on all covered drugs until the end of the year.

Prescription drug coverage example

Stages	Example
Initial Coverage Stage	In this example, the total cost of a Tier 2 generic drug is $30. You pay: Your plan’s deductible first (if applicable). Then you pay your plan’s Tier 1 generic drug copay of $9. Plan pays: the remaining $21 for the same generic drug. A total of $30 ($9 your cost plus $21 plan’s cost) is accumulated. You have $3,790 ($3,820 - $30) left in the initial coverage stage.
Coverage Gap Stage	You pay: A maximum of 37% of the total cost of $30. Your cost would be $11.10. A total of $11.10 is accumulated in the coverage gap stage. Only your costs are accrued in this stage.
Catastrophic Coverage Stage	You pay: The greater of 5% or $3.40 for a generic drug or a drug treated like a generic drug and 5% or $8.50 for all other drugs.

Extra help with prescription drug costs

Centers for Medicare & Medicaid Services
The government offers extra help for Part D prescription drug costs. To see if you qualify, call 1-800-MEDICARE (1-800-633-4227), 24 hours a day, seven days a week. TTY users should call 1-877-486-2048. Or you can visit online at www.medicare.gov.

Medical Assistance (Medicaid)
To see if you qualify for medical assistance from the state (Pennsylvania), call 1-800-692-7462 Monday through Friday from 8:30 a.m. to 4:45 p.m. TTY users should call 1-800-451-5886.

To see if you qualify for medical assistance from the state of Ohio, call 1-800-324-8680 Monday through Friday from 7 a.m. to 8 p.m. and Saturday from 8 a.m. to 5 p.m.

PACE/PACENET
Pennsylvania offers help to older adults for prescription drug coverage. Call 1-800-225-7223 from 8:30 a.m. to 8 p.m., Monday through Friday, and 9 a.m. to 3 p.m. on Saturday. TTY users should call 1-800-222-9004. Or you can visit online at https://pacecares.magellanhealth.com/.

Veterans Administration (VA)
To see if you qualify for Veterans Administration benefits, visit online at www.va.gov or go to your local VA facility.

Links:
www.medicare.gov
https://pacecares.magellanhealth.com/
www.va.gov