Glossary – Definitions of Medicare
This is the United States Federal health insurance program for people who are 65 years or older. Some folks may also be eligible for Medicare under age 65 due to kidney disease (ESRD) or certain disabilities and have received social security disability benefits for at least 24 months.
This refers to the “no cost to you” premium associated with Medicare Part A. Not paying any premium means that you have worked at least 40 quarters in your lifetime and have contributed to the national Medicare tax through payroll deduction or self employment taxes.
Medicare Part A which is also know as ‘hospital insurance’ is health insurance provided under the federal Medicare program and helps cover expenses that occur while you are receiving care inside a hospital facility. However, it does not cover everything as some services like doctors, tests and screenings are covered under Part B of Medicare.
Medicare Part B is the second half of original Medicare insurance. Part A being the first. Think of Part B as your medical coverage outside of the hospital. It will provide coverage for primary care physicians, specialists and outpatient facilities. Part B also covers many other services like durable medical equipment like canes, walkers and wheelchairs, laboratory tests like blood work and screenings, flu shots, home health services and other medical services.
Part C (Medicare Advantage)
A health insurance plan for Medicare eligible recipients that is operated by a private insurance company. The insurance company contracts with the Federal government to provide a plan that must include all the benefits of Part A and Part B of Medicare at a minimum. Most of these health plans also include additional benefits like prescription drug coverage, dental and vision benefits and health club memberships at a discount. The most popular Medicare Advantage plans are used in conjunction with networks of doctors and hospitals. Most commonly PPO and HMO networks.
Medicare Part D also known as Prescription Drug Coverage is offered to anyone eligible for Medicare. You can get coverage by either joining a stand alone PDP (Prescription Drug Plan) sold by private insurance companies or joining a Medicare Advantage Plan (Medicare Part C).
Medigap (Medicare Supplement Insurance)
Insurance contracts provided by private insurance companies that help cover out of pocket expenses associated with Medicare. Medigap plans are available in all 50 States and are governed by federal and state laws. There are 10 medigap policies and each is assigned a letter from A through N.
Prescription Drug Plan is a stand alone insurance that is sold by private insurance companies. Each plan must offer the same basic benefits and cost structure set by CMS. In order to enroll in a PDP you must have Part A or Part B of original Medicare.
A term used to describe a network of doctors and hospitals and healthcare providers. Health Maintenance Organization (HMO) will only cover expenses when used within these networks, other than an emergency or urgent care situation. Some HMO’s may require that your primary care doctor refers you to another doctor or specialist and this can limit your choices.
CMS is the acronym for the Centers for Medicare & Medicaid Services which is governed by the Department of Health & Human Services.
A term used with regards to the Affordable Care Act of 2010. The Marketplace was set up to assist people enroll in traditional healthcare under President Obama. This plan was also known as ‘Obamacare’. The Marketplace was an online platform that allowed users to shop for health insurance and apply for premium subsidies if they qualified. The Marketplace does not have anything directly to do with Medicare.
DME Durable Medical Equipment
Mostly for in home use and ordered from your doctor, items like walkers, canes, oxygen equipment, hospital beds and wheelchairs are considered durable medical equipment. These items are more than often rented rather than purchased and are supplied by companies that are participating in the Medicare program.
Your doctor, medical provider or supplier agrees to accept the Medicare direct payment amount for services rendered. You would not be billed any extra if you make sure that services you use accept Medicare Assignment. Some states prohibit doctors and providers from charging extra above and beyond what Medicare pays. These are know as Excess Charges and you would be responsible for those payments.