Many older Americans rely on the Medicare program for their primary health care coverage. Medicare is the federal program that helps pay medical bills for people 65 years and older, as well as people with certain disabilities and those who suffer from permanent kidney failure. It should not be confused with Medicaid, which is for low-income people. The Medicare program is divided into two parts: Under Part A, seniors are eligible for hospital insurance while Part B covers medical insurance.
Depending on where you live, you may have more than one Medicare plan to choose from. It is important that you choose the plan that is best for you, so you may need advice from your doctor.
Here are the basics of Medicare Part A coverage to help guide your decision:
- If you or your spouse paid Medicare taxes while you were working, you’re eligible for Part A coverage for free. If you’re not eligible because you or your spouse do not have enough quarters of Medicare-covered employment, you can pay a monthly premium in 2014 of up to $426 depending on your income (down from $441 in 2013).
- If you enroll in paid Part A, you can also enroll in Part B, for which you pay an additional monthly premium. For 2014, the premium is $104.90 a month (unchanged from 2013) if your modified adjusted gross income is $85,000 or less and you file an individual tax return ($170,000 when filing jointly). People with higher annual incomes pay higher premiums.
- Medicare Part A covers a portion of your costs for a semi-private room during your stay in a hospital, skilled nursing facility or hospice. It also covers some home health care.
- Medicare only helps pay for skilled nursing home care, not custodial care in which a patient needs help with such daily tasks as walking, dressing and eating. For Medicare to cover the facility’s charges, the patient must require daily skilled nursing or skilled rehabilitation services which can be provided only in a skilled nursing facility.
- Medicare Part A can only help pay for nursing home care following a related hospital stay of at least three days in a row.
- If you’re covered by Medicare Part A, you still must pay an initial hospital stay deductible before Medicare will pay anything. For 2014, this deductible is $1,216 for the first 60 days per benefit period (up from $1,184 in 2013).
- After the deductible, Medicare Part A pays only certain amounts of a facility’s bill. The amount depends on whether the facility is a hospital, psychiatric hospital or skilled nursing facility or whether care is received at home or through a hospice.
- The amount that Medicare Part A pays depends on how many days of inpatient care you have during a benefit period.
The Medicare Benefit Period
The Benefit Period is basically the duration of an illness. It begins when the patient is admitted to a facility and continues until the patient has been discharged for 60 consecutive days. If you are in and out of the health care facility several times but have not stayed out completely for 60 consecutive days, Medicare counts that as one benefit period.