Introduction

A Brief Overview

Medicare is a federal health insurance program primarily available to individuals aged 65 and older, as well as certain younger individuals with disabilities or specific health conditions. By splitting coverage into different parts—A, B, C, and D—Medicare ensures that beneficiaries can customize their healthcare plans according to their needs. Established in 1965, it has since become a cornerstone of retirement planning and long-term care for millions of Americans.

Key Components of Medicare

Part A (Hospital Insurance)

• What It Covers: Inpatient hospital stays, care in a skilled nursing facility, some home health services, and hospice care.
• Cost Notes: Most beneficiaries pay no premium for Part A if they or a spouse have worked and paid Medicare taxes for at least 10 years (40 quarters). However, deductibles and coinsurance apply, usually calculated per benefit period.

Part B (Medical Insurance)

• What It Covers: Outpatient services, physician visits, preventive care (such as screenings and flu shots), and durable medical equipment.
• Cost Notes: Beneficiaries typically pay a monthly premium, which can vary by income. After meeting a deductible, Medicare generally covers 80% of approved costs, leaving 20% as coinsurance.

Part D (Prescription Drug Plans)

• What It Covers: Prescription medications, often organized by cost tiers in each plan’s formulary.
• Enrollment: Offered by private insurers; you can join a standalone Part D plan with Original Medicare or get drug coverage through a Medicare Advantage plan that includes Part D benefits.

Gaps and Additional Considerations

Medicare Supplement (Medigap) Policies

• Why They Matter: Medigap fills coverage “gaps,” helping pay deductibles, copayments, and coinsurance not covered by Parts A and B.
• Enrollment Window: The best time to buy a Medigap policy is in the six-month window starting when you turn 65 and enroll in Part B (your Medigap Open Enrollment Period).

Services Not Typically Covered

• Routine Dental and Vision Care: Original Medicare usually excludes cleanings, routine eye exams, and glasses.
• Long-Term Care: Extended nursing home stays are not covered except in specific, limited circumstances.
• Overseas Healthcare: In general, Medicare doesn’t cover medical expenses outside the U.S., unless in rare emergencies.