Medicare Basics
Medicare has several different parts. Here are the four basic parts of Medicare:
Medicare Part A - Hospital Insurance
Part A is hospital insurance that helps pay for: hospital care as an inpatient, critical access hospitals, small facilities that give limited outpatient and inpatient services to people in rural areas, skilled nursing facilities, hospice care, and some health care.
Most people do not pay for Part A. Most people get Part A automatically when they turn 65. They do not have to pay a monthly payment for Part A because they, or a spouse, paid Medicare taxes while they were working.
Medicare Part B - Medical Insurance
Part B is your outpatient medical coverage. Part B helps pay for doctors, services, outpatient hospital care, and some other medical services that Part A does not cover, such as physical and occupational therapists and some home healthcare. Part B helps pay for these covered services and supplies when they are medically necessary.
The cost of Part B is set by Social Security, and changes from year to year. Some people automatically get Part B, and others need to sign up for Part B. If you do not sign up for Part B when you are first eligible, you may have to pay a late enrollment penalty.
Medicare Part C - Medicare Advantage
Part C, also referred to as Medicare Advantage Plans, are offered by private insurance companies as an alternate to original Medicare (Parts A&B). These plans are government subsidized and regulated.
Depending on where a person lives, that person may be able to enroll in a Medicare Advantage plan offering one or more of the following types of healthcare: HMO, PPO, PFFS.
Medicare Part D - Prescription Drug
Prescription Drug Coverage Part D plans are offered by private companies to provide coverage for prescription drug costs. Medicare Part D plans are government subsidized and regulated.
The coverage is available to all people eligible for Medicare, regardless of income, resources, health status, or current prescription expenses. Medicare prescription drug coverage can provide protection for people who have very high drug costs. If you do not sign up for Prescription Drug Coverage when you are first eligible, you may have to pay a late enrollment penalty.