What Is Medicare? How Does It Work?

Medicare is a federal health insurance program in the US and many other countries that offer health insurance programs to the following people:

• Elders who are 65 years and above
• Young people with disabilities
• People suffering from permanent kidney failure and the ones who require assistance is transplants and dialysis

There are different parts to medicare insurance that cover specific services like:

• Medicare part A – Hospital insurance covers all the admissions and inpatient hospital stays, hospital services, nursing care facilities, and certain health care services. Sometimes people do not pay a monthly premium for Part A, which is the Premium-free Part A. However, if people are not eligible for the premium-free services, they can buy the Part A plan and pay $506 each month in 2023.
• Medicare part B – Medical insurance: It covers all the outpatient hospital and doctor’s services, including medical supplies and other preventive services for patients suffering from different kinds of disabilities. Most people pay a monthly premium for part B, which is $164.90 in 2023.
• Medicare part D – Prescription drug coverage: It covers the costs of all the prescribed drugs for the patient, which might also include vaccines, shots, and injections.

How does medicare work?

Medicare offers different options for drug, hospital, and health care coverage. Once a person enrolls for medicare services, they have to decide how they can get the coverage, which can mainly be done in two different ways.

Original medicare

This includes Hospital insurance (Part A) and Medical Insurance (Part B). People generally pay for the services as and when they get them and get a deductible every year. People have to pay 20% of the coinsurance. If people wish to customize it with drug coverage, they can add Part D of the insurance.

Medicare Advantage

It is a medical and hospitalization-approved plan for big corporate companies. These are bundled plans which generally include Part A, Part B, and sometimes Part D. this type of plan also offers a few extra benefits not covered in the original medicare plan, like dental, vision, and hearing services. They generally have yearly contracts and follow the coverage rules.

When people opt for medicare prescription drug coverage (part D), they generally get all the overage of drugs necessary after a person is discharged from the hospital. But, one of the prerequisites of this plan is first to join a medical-approved plan which offers extended drug coverage policies. Although the plan can vary related to costs and specific drugs, they often follow a general standard set by the medicare company. In addition, these plans include drugs under different brand names as well as some generic drugs. Therefore, the cost coverage depends on the different ‘tiers’ they fall under!