A national health insurance program, Medicare helps seniors pay for their medical expenses. It covers doctors’ visits, hospital stays, prescription drugs, and preventive care.
Seniors who enroll in Medicare must choose between traditional Medicare (Parts A and B) and Medicare Advantage Plans and make other important decisions about their coverage. Our focus groups revealed that many seniors struggle to make informed and optimal plan choices.
Access to a Wide Range of Medical Services
Medicare provides coverage for a wide range of medically necessary services, equipment and supplies. It covers hospital stays, doctor’s visits, lab work, x-rays, and more. The program also pays for long-term care in nursing homes, and for some home health services such as visiting nurses or aides to help you bathe or get dressed. Medicare Part D offers prescription drug coverage. You may have to pay a premium for this coverage, but it is usually less than you would pay if you purchased an individual health insurance plan, such as a preferred provider organization (PPO) or health maintenance organization (HMO), or a private medigap policy. Should the need arise, we advise you to read up on the california medicare supplement birthday rule.
The cost of medical care can be a significant burden on elderly people, particularly low-income individuals. Large out-of-pocket costs can force individuals to make hard choices between the necessities of life and health care services that they need. It is important that a program like Medicare is supplemented by programs such as Medicaid and supplemental insurance to help individuals who cannot afford to pay for the full cost of medical care.
Because of the limits on Medicare’s payment for health care services, some seniors find it difficult to use Medicare to its full extent. They may be unsure of what is covered and what is not, and they may not have the information and the tools needed to navigate the system.
The federal government operates an official website that provides a database of services and items that Medicare does cover, and mobile apps for Apple and Android devices also are available. The program also offers a guide to assist people who are new to Medicare. For many, the best way to determine whether a service or item is covered is to discuss it with a doctor or other health care provider. This ensures that you receive the maximum benefit from your Medicare coverage.
Coverage for Certain Wellness Programs
A quality wellness program for seniors focuses on healthy habits that can help prevent many health conditions, including heart disease, cancer, diabetes, high blood pressure and Alzheimer’s. It can also encourage weight loss, regular exercise and a healthy diet. Many programs provide support groups and seminars to assist seniors in maintaining a positive attitude and healthy lifestyle.
Seniors who participate in these programs often enjoy a higher quality of life and lower medical expenses than those who do not. This can contribute to reduced Medicare costs, as the cost of care for individuals who do not participate in a wellness program is generally greater.
A common way for seniors to reduce their out-of-pocket Medicare costs is through a Medicare Advantage plan, which offers additional benefits not available with Original Medicare, such as gym memberships and wellness programs like SilverSneakers. However, Medicare Advantage plans can have different benefits and cost structures, so a person should carefully evaluate these options before enrolling.
Another option for reducing Medicare costs is through the use of a short-term insurance policy. These policies are not regulated in the same way as traditional health insurance, and they tend to have very low premiums. They can be an effective solution for filling in gaps in coverage, such as when a senior retires from work or moves to a new state, before their Medicare plan or a traditional health insurance policy begins.
Most Americans 65 and older qualify for free Medicare hospital coverage, but those who do not can purchase private insurance through the federal marketplace. There are various enrollment periods throughout the year. People who retire can typically sign up for private insurance through a special enrollment period during the 60 days that follow their termination of employment or loss of employer-sponsored health coverage. Those who already have Medicare can enroll during the open enrollment period each fall.
Prescription Drug Coverage
Medicare Part D provides prescription drug coverage to help cover the costs of medications. This benefit is offered as a standalone plan or through private medical insurance companies that contract with Medicare to provide benefits. It can also be included in a Medicare Advantage plan (like HMOs or PPOs) that typically include all Medicare-covered services in a single policy.
The standard Medicare Part D benefit includes a deductible, initial coverage phase, and catastrophic coverage. Enrollees are responsible for paying the full cost of their medications until they reach a set amount in out-of-pocket spending, after which the plan begins to pay a share of the costs. The Medicare program is making changes to Part D in 2022 and 2023, including raising the deductible and lowering the out-of-pocket spending threshold.
It’s important to understand how this changes impact your specific circumstances and how they might affect your costs. You’ll also need to consider the other prescription drug coverage you may have, such as from your employer, union, TRICARE or the Department of Veterans Affairs, or a Medigap plan that you purchased or use with an individual health insurance company.
If you aren’t already enrolled in Medicare Part D, you can do so for six months following your 65th birthday. It’s a good idea to sign up during this time to avoid paying an enrollment penalty later on.
Medicare Advantage plans, which combine Medicare Parts A and B into a single policy, also include prescription drug coverage. However, you’ll likely have to pay higher up-front costs with these types of plans, such as a premium and copays.
Most Medicare Advantage plans also offer vision, hearing, and dental coverage. Additionally, these plans often feature large networks of doctors and medical providers to give you greater freedom in where you go for healthcare. Medicare Supplemental Insurance plans, or Medigap, are also available for individuals who want to supplement their Medicare coverage with additional coverage options.
Costs
Although attention to Medicare’s high copayments and deductibles sometimes distract from its overall success, the fact remains that, for most beneficiaries, Medicare saves them substantial amounts in the costs of their health care. Indeed, studies indicate that, had Medicare not existed in 1965, the elderly would have had to devote a much larger share of their incomes to health care.
Medicare also helps seniors to avoid problems that arise when they are forced to choose between seeking medical care and meeting financial obligations. For example, many low-income seniors who only have Medicare may delay seeking needed medical care because of concerns about cost. These delays can potentially compromise health status and result in greater costs when the problem is finally treated because it has become more serious.
For example, a recent study found that elderly Medicare beneficiaries who do not have private supplemental insurance spend about $13,000 per year on average for hospital inpatient stays. Those who do have supplemental insurance typically spend only about $6,600 per year on average.
Similarly, the study found that low-income seniors without supplemental insurance are twice as likely to report delaying necessary medical care because of concerns about cost than those who do have supplemental insurance. In addition, about half of all low-income Medicare beneficiaries report that they have to choose between paying for prescription drugs and food.
Finally, it is important to note that Medicare’s administrative expenses accounted for only 1.3% of the program’s total spending in 2021. This is a small percentage of the overall amount spent on medical services, which was more than $400 billion.
As the number of beneficiaries in Medicare continues to rise, attention should be given to how well the program is functioning. The fact is that, despite concerns about the cost of the program and issues surrounding future growth in the beneficiary population, Medicare has managed to absorb a doubling of the number of beneficiaries since its creation in 1966. This growth is largely due to the fact that people are living longer, and the health benefits of the Medicare program are helping them to do so.