Medicare is a health insurance program run by the Federal Government. It provides coverage for people who are:
- Age 65 and older
- Under age 65 with certain disabilities
- Of all ages with end-stage renal disease
Medicare is made up of parts that handle different types of coverage:
- A and B, also known as Original Medicare
- C (Medicare Advantage)
- D (Prescription Drug Plans)
There is also a product that isn't a part of Medicare that provides additional coverage, called Medicare Supplement or Medigap. Medicare Supplement plans are a supplement to Medicare and are available through private insurance companies such as Blue Cross and Blue Shield of North Carolina.
Who's Eligible for Medicare?
To be considered eligible for Medicare:
- You or your spouse must have worked at least 10 years in a job that is considered Medicare-covered
- You're a United States citizen or a legal resident who has lived in the U.S. for at least five consecutive years
- You have a disability or end-stage renal disease
If you're getting Social Security at age 65, then you automatically get a Medicare card. It looks something like this:
If you're age 65 and you're not getting Social Security, you'll need to apply for Medicare through your local Social Security office. Keep in mind there are very specific times to enroll in Medicare; typically, you can enroll three months before you turn 65, including the month you turn 65 and ends 3 months after you turn 65. If you wait too long, you could face penalty fees for late enrollment.
Medicare coverage allows you to see any doctor or hospital in the United States that accepts Medicare. No referrals needed, even if you see a specialist. Care outside the U.S. isn't usually covered.
You can't be denied Medicare coverage because of your medical history or pre-existing conditions.
How Medicare Works
Generally, here's what Medicare does for beneficiaries:
- Provides coverage for outpatient services, such as those received in a hospital
- Helps cover the cost of certain types of medical services
- Lowers your out-of-pocket costs
Medicare is made up of different parts, each handling different types of health care services or supplies:
Medicare Parts A and B (Original Medicare)
Parts A and B (also known as Original Medicare) are run by the Federal Government. With these parts, the government pays the doctors and hospitals you visit directly for your health care.
Part A covers:
- Hospital inpatient care services
- Inpatient care for nursing homes or other skilled nursing facilities
- Hospice care
Part A pays most hospital costs for stays that last up to 60 days annually. After 60 days, you pay a daily copayment for each additional day. If you're hospitalized for more than 90 days, you may have to pay for all of your care.
Part B covers:
- Doctor visits
- Outpatient care (including preventive services)
- Physical or occupational therapy
- Home health care services that are medically required
Part B doesn't limit how many covered medical services you can get, as long as the services are medically necessary to treat a medical illness or condition. Some services, such as preventive care and screenings, may be limited.
In addition, with Parts A and B:
- You can enroll in Medicare Part D to receive prescription drug coverage
- You can enroll in a Medicare Supplement plan, to help with the Part A and Part B costs that Medicare doesn't cover
Medicare Part C (Medicare Advantage)
With Part C plans, the government pays a set fee to your plan for your health care and then your plan pays the doctors and hospitals.
Part C plans include:
- The same coverage and services as Medicare Parts A and B, plus additional benefits (such as vision and dental)
- Part A benefits, including hospital visits, skilled nursing care and home health care
- Part B benefits, including doctor visits, outpatient care, screenings, shots, lab tests, etc.
- Prescription drug coverage, if Part D coverage is included in the Part C plan
Some Part C plans may also include coverage for other services, including fitness programs or hearing and vision care.
We provide two types of Medicare Advantage plans:
- Health Maintenance Organization (HMO): Known as Blue Medicare HMOSM. This plan features a network of doctors and hospitals where you can receive medical services.
- Preferred Provider Organization (PPO): Known as Blue Medicare PPOSM. Provides the flexibility to visit doctors and hospitals inside and outside of the plan's network, but services outside the network usually cost more than inside the network.
You must be entitled to Part A and enrolled in Medicare Part B to get a Medicare Advantage plan.
Medicare Part D (Prescription Drug Plans)
Part D plans help pay for prescription drugs, as well as brand name and generic medications.
Part D plans have:
- Formularies, which are lists of the drugs covered under a plan
- Different levels of cost-sharing, which means you pay different amounts for your prescription drugs, depending on the level
- A network of available pharmacies for you to choose from, and can include local or nationwide access, or mail order pharmacy services
If you're entitled to Medicare benefits under Part A or enrolled in Part B, or have a Medicare Supplement plan, you can get Part D coverage as a stand-alone plan through a private health insurance company like BCBSNC.
If you have Medicare Advantage, prescription drug coverage may be included – but remember that you can't have both a Medicare Advantage plan and a separate Part D plan because of Medicare laws.
If you're considering prescription drug coverage, sign up as soon as you're eligible — otherwise, you may have to pay a penalty fee for late enrollment.
Medicare Supplement (Medigap)
Parts A and B (also known as Original Medicare) pay for many, but not all, health care services and supplies. That's where Medicare Supplement plans come in: they help pay for those things Parts A and B don't cover, such as Medicare copayments, coinsurance and deductibles.
Medicare Supplement plans are run by private insurance companies. These plans are state-regulated and not offered by the Federal Government.
Some Medicare Supplement plans provide additional coverage for services when traveling outside the United States.
Picking a Plan
The first question to ask yourself is "Do I want Part A, B or C?"
If you choose Parts A and B, you could have:
- Parts A and B only
- Parts A and B with a Part D prescription drug plan
- Parts A and B with a Medicare Supplement plan
- Parts A and B with a Medicare Supplement plan and a Part D plan
You could have:
- A Part C plan that includes Part D prescription drug coverage
- A Part C plan that doesn't include Part D prescription drug coverage*
*Purchasing a Part D prescription coverage alone will cancel any Part C coverage already in place, with the exception of Private Fee For Service (PFFS) plans. PFFS plans and Part D prescription plans can be purchased separately.
So how do you pick the right plan? The best way is to break things down into steps to figure out what's most important to you when comparing plans:
Original Medicare Parts A and B vs. Medicare Advantage
- Parts A and B cover doctor visits, preventive care and hospital visits
- Medicare Advantage offers Medicare Parts A and B coverage, but usually with more benefits (prescription drug coverage, vision, hearing, etc.)
When considering the costs, you should ask:
- Whether Parts A and B with a Part D prescription drug plan (and/or a Medicare Supplement/Medigap plan) would cost more or less than a Medicare Advantage plan with similar coverage
- How much the premiums, copayments, coinsurance and deductibles are for each option -- and in the case of prescription drug costs, how much the costs are within the coverage-gap.
Doctors and Hospitals
- Does the plan have a network? How big is it?
- Is your current doctor or preferred hospital a part of the network?
- Look at what available Medicare Advantage plans offer in addition to Parts A and B
- Ask yourself whether you need a prescription drug plan or Medicare Supplement insurance with Medicare Parts A and B
How to Enroll
Parts A and B
If you receive Social Security benefits when you become eligible for Medicare, you're automatically enrolled in Parts A and B. If you want to remove Part B coverage, you'll need to contact your local Social Security office.
If you're not receiving Social Security benefits, but you're eligible for Medicare, you can enroll in Parts A and B during your initial enrollment period at your local Social Security office.
You can enroll in a Part C (Medicare Advantage) plan:
- As soon as you're eligible for Medicare (Initial Enrollment Period)
- Every year during the Annual Enrollment Period (AEP)
You must be entitled to Medicare Part A and enrolled in Medicare Part B.
If you're enrolled in Parts A and/or B, you can enroll in a Part D plan as soon as you become eligible for Medicare, during your initial enrollment period, and each year during the AEP. Keep in mind that you may have to pay a late enrollment penalty for Part D coverage if you enroll other than when you're first eligible.
Medicare Supplement (Medigap)
You can enroll in a Medicare Supplement plan during your open enrollment period, the first six months after you both turn 65 or older and enroll in Part B.
Neither Blue Cross and Blue Shield of North Carolina nor its agents are endorsed by or affiliated with the United States government or the federal Medicare program.
The information on this page is current as of 10/01/2013.
Y0079_6246 CMS Approved 10212013
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