Supplemental Health Insurance Policy for Medicare Patients
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Medicare Basics
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Medicare has two main parts: Part A, which covers hospitalization and hospice, and Part B, which covers doctors services, lab tests and durable medical equipment. If you're hospitalized and use Part A, you're responsible for a deductible of more than $1,000. Part B covers any doctors you see and had a calendar year deductible of more than $100 and 20 percent coinsurance after that.
Medicare Supplements
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Medicare Supplements, or Medigap plans, are for those who only have Medicare, and no other health insurance. Plans are lettered A-G and K-N, and each plan covers part of the out-of-pocket costs in original Medicare. Plan A, for example, covers Part A's coinsurances for hospitalization and hospice and Part B's coinsurance. You are still responsible for the Part B deductible and the co-pay for skilled nursing care. Plans K and L are lower premium cost sharing plans. They cover a percentage of coinsurances, rather than the whole thing. Medigaps are regulated by the federal government, so a Plan A from one company, for example, has the same benefits as a Plan A from another company.
Part D Plans
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Part D is Medicare's prescription drug benefit. It's a bit of a misnomer, as Part D is actually administered through private companies and not through Medicare itself. Part D plans have to meet minimums set by the federal government, but everything else varies from company to company. Each company sets its own premium, deductible, co-pays and prescription drug list. If you purchase a Medicare Supplement plan, you should purchase a Part D plan. If you purchase a Medicare Advantage plan, your prescription coverage may be included.
Medicare Advantage Plans
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Medicare Advantage, or MA, plans are Part C of Medicare. Again, calling it Part C is a bit misleading as it's also offered entirely through private companies. In fact, MA plans pay in place of Medicare, although you do retain all your rights as a Medicare patient. MA plans usually work with a network and have a monthly premium, co-pays and possibly deductibles. The advantage of MA plans for a Medicare patient is that the premiums are lower than Medigap plans. You may incur higher out-of-pocket costs, though, so it's important to make a careful comparison.
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