Medicare is a program run by the government and is funded by payroll tax, surtaxes and premiums from beneficiaries, and general revenue. Medicare is a social insurance program that was started in 1966 and is associated with 30–50 private insurance firms of the country that are under contract for administration. Medicare was started to provide health insurance to people who are 65 and older. Medicare covers younger people too if they have some disability status as per their Social Security Administration.
Medicare health plans
Understanding the basics of Medicare health plans is essential to ensure one gets the right health insurance post the age of 65. Private health insurance companies that are in contract with Medicare offer health insurance plans to people who are covered under Medicare. There are different types of Medicare health plans that include Medicare Advantage Plans, Medicare cost plans, Demonstrations/pilot programs, Programs of All-inclusive Care for the Elderly (PACE), and Medication Therapy Management (MTM).
Medicare Advantage Plans
These are Medicare health plans offered by private company under contract with Medicare. These plans provide all the benefits of Parts A and B (hospital and medical insurance, respectively). Medicare Advantage Plans are inclusive of the following.
- Preferred Provider Organizations (PPO)
- Health Maintenance Organization (HMO)
- Private Fee-for-Service Plans
- Medicare Medical Savings Account plans
- Special Needs Plans
In this plan, the insured can opt for doctors, hospitals, and other healthcare providers who are not expensive and come under the plan’s network. Using health care services from doctors and hospitals that do not come under the plan’s network will be expensive.
Coming to prescription medicines in PPO plans, most prescription medicines are covered; however, it is always better to join a PPO plan that covers the prescription medication cost. It is important to know that if someone has a PPO plan that does not cover prescription medication cost, they cannot join a Medicare Prescription Plan (Part D).
A PPO plan is different from an Original Medicare or Medicare or a Medigap policy. There are extra benefits one can avail from PPO plans by paying extra than the normal amount.
In HMO plans, one can get care and services from all health providers that come under the Medicare network. However, there are times when these one cannot get these services from the health care service providers under the network such as out-of-area urgent care, out-of-area dialysis, and emergency care. HMO plans also ask for a referral from the primary care doctor of the person who is getting an HMO plan. In most HMO plans, one has to choose a primary care doctor.
Most HMO plans cover prescription medicines; however, it is important to check if an HMO plan comprises that clause.
Other Medicare health plans
There are some Medicare plans that provide coverage for Medicare Parts A and B. Other Medicare health plans only medical insurance coverage.
Some policies under other Medicare health plans are same as Medicare Advantage Plans; however, each plan may have different rules and exceptions. Therefore, it is important to understand each plan in detail while opting for one.
Medicare Cost Plans
These plans are available in only some areas of the country. It is possible to join a Medicare cost plan if the insured is covered under Part B. In the case of being covered under Parts A and B, the insured can go to a health care service provider who is not part of the network. You can join a Medicare cost plan when new members are being accepted and leave at any point in time to return to original Medicare.
There are special projects that examine progress and improvements under Medicare coverage, payments, and quality of care. These programs are often operational for a given period and are available to a limited group of people. These programs can be checked for availability by contacting a nearby Medicare service provider.
This is a Medicare/Medicaid program that helps people get their health care needs in the community instead of going to a nursing home or any other care facility.
One can learn how to manage the medications through a free MTM program. This program has the following benefits:
- List of medicines and reasons for their consumption
- Action plan for taking the medications more accurately
- Summary of the medication review
It is important to do thorough research before getting any plan. You can visit healthcare.gov for more information.