Introduction to Medicare

Introduction to Medicare

Medicare is the federal government program that provides health care coverage (health insurance) if you are 65+, under 65 and receiving Social Security Disability Insurance (SSDI) for a certain amount of time, or under 65 and with End-Stage Renal Disease (ESRD). The Centers for Medicare & Medicaid Services (CMS) is the federal agency that runs Medicare. The program is funded in part by Social Security and Medicare taxes you pay on your income, in part through premiums that people with Medicare pay, and in part by the federal budget.

Once you have become Medicare-eligible and enroll, you can choose to get your Medicare benefits from Original Medicare, the traditional fee-for-service program offered directly through the federal government, or from a Medicare Advantage Plan, a type of private insurance offered by companies that contract with Medicare (the federal government). Original Medicare includes:

  • Part A (Inpatient/hospital coverage)
  • Part B (Outpatient/medical coverage)

If you want Medicare prescription drug coverage (Part D) with Original Medicare, in most cases you will need to actively choose and join a stand-alone Medicare private drug plan (PDP).

You still have Medicare if you enroll in a Medicare Advantage Plan. This means that you will still owe a monthly Part B premium (and your Part A premium, if you have one). Each Medicare Advantage Plan must provide all Part A and Part B services covered by Original Medicare, but can do so with different rules, costs, and restrictions that can affect how and when you receive care. Medicare Advantage Plans can also provide Part D coverage. Note that if you have health coverage from a union or current or former employer when you become eligible for Medicare, you may automatically be enrolled in a Medicare Advantage Plan that they sponsor. You have the choice to stay with this plan, switch to Original Medicare, or enroll in a different Medicare Advantage Plan, but you should speak with your employer/union before making any change.

It is important to understand your Medicare coverage choices and to pick your coverage carefully. How you choose to get your benefits and who you get them from can affect your out-of-pocket costs and where you can get your care. For instance, in Original Medicare, you are covered to go to nearly all doctors and hospitals in the country. Medicare Advantage Plans, on the other hand, usually have network restrictions, meaning that you will be more limited in your access to doctors and hospitals. However, Medicare Advantage Plans can also provide additional benefits that Original Medicare does not cover, such as routine vision or dental care.

Medicare is different from Medicaid, which is another government program that provides health insurance. Medicaid is funded and run by the federal government in partnership with states to cover people with limited incomes. Depending on the state, Medicaid can be available to people below a certain income level who meet other criteria (e.g., age, disability status, pregnancy) or be available to all people below a certain income level. Remember, unlike Medicaid, Medicare eligibility does not depend on income. Also, eligible individuals can have both Medicare and Medicaid and are known as dual-eligibles.

Everyone who has Medicare receives a red, white, and blue Original Medicare card. If you choose to receive your coverage through Original Medicare, you will show this card when you get services. If you choose to receive your Medicare benefits through a Medicare Advantage Plan, you will still get an Original Medicare card but you will show your Medicare Advantage Plan card when you get services. No matter how you get your Medicare health benefits, only give your Medicare number to your doctors and health care providers.

Medicare Supplement insurance plan basic benefits

Each Medicare Supplement insurance plan offers a different level of basic benefits, but each lettered plan must include the same standardized basic benefits regardless of insurance company and location. For example, Medicare Supplement Plan G in Florida includes the same basic benefits as Plan G in North Dakota. Please note that if you live in Massachusetts, Minnesota, or Wisconsin, your Medicare Supplement insurance plan options are different than in the rest of the country. Medicare Supplement insurance plans do not have to cover vision, dental, long-term care, or hearing aids, but all plans must cover at least a portion of the following basic benefits:

  • Medicare Part A coinsurance costs up to an additional 365 days after Medicare benefits are exhausted
  • Medicare Part A hospice care coinsurance or copayments
  • Medicare Part B coinsurance or copayments
  • First three pints of blood used in a medical procedure


Some plans include additional basic benefits. For example, Medicare Supplement Plan F*, the most comprehensive standardized Medigap insurance plan, carries the following additional benefits:

  • Medicare Part A deductible
  • Medicare Part B deductible*
  • Part B excess charges
  • Part B preventive care coinsurance
  • Foreign travel emergency care (80% of Medicare-approved costs, up to plan limits)


Skilled Nursing Facility (SNF) care coinsurance Some plans may include additional innovative benefits.

*Medicare Supplement plans that may cover the Medicare Part B deductible – Medicare Supplement Plans C and F – will be phased out. If you’re not eligible for Medicare until January 1, 2020 or later, you won’t be able to buy Plan C or Plan F. You won’t generally have to give up your Plan C or Plan F if you already have one. If you’re eligible for Medicare before January 1, 2020, you might be able to buy Plan C or Plan F.

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Medicare Part D

Do you have fairly frequent doctor or hospital visits? If so, you may already know that Medicare Part A and Part B come with out-of-pocket costs you have to pay. You might be able to save money with a Medicare Supplement insurance plan. Medicare Supplement, or Medigap, insurance plans fill in “gaps” in basic benefits left behind by Original Medicare, Part A and Part B, such as deductibles, coinsurance, and copayments.

In 47 states, there are up to 10 standardized Medicare Supplement insurance plans that are denoted by the letters A through N (plans E, H, I, and J are no longer sold). The private insurance companies offering these plans do not have to offer every Medicare Supplement plan, but they must offer at least Plan A.

Please note that although the names may sound similar, the “parts” of Medicare, such as Part A and Part B, are not the same as Medigap Plan A, Plan B, etc.

Medicare Supplement insurance plan basic benefits

Each Medicare Supplement insurance plan offers a different level of basic benefits, but each lettered plan must include the same standardized basic benefits regardless of insurance company and location. For example, Medicare Supplement Plan G in Florida includes the same basic benefits as Plan G in North Dakota. Please note that if you live in Massachusetts, Minnesota, or Wisconsin, your Medicare Supplement insurance plan options are different than in the rest of the country. Medicare Supplement insurance plans do not have to cover vision, dental, long-term care, or hearing aids, but all plans must cover at least a portion of the following basic benefits:

  • Medicare Part A coinsurance costs up to an additional 365 days after Medicare benefits are exhausted
  • Medicare Part A hospice care coinsurance or copayments
  • Medicare Part B coinsurance or copayments
  • First three pints of blood used in a medical procedure


Some plans include additional basic benefits. For example, Medicare Supplement Plan F*, the most comprehensive standardized Medigap insurance plan, carries the following additional benefits:

  • Medicare Part A deductible
  • Medicare Part B deductible*
  • Part B excess charges
  • Part B preventive care coinsurance
  • Foreign travel emergency care (80% of Medicare-approved costs, up to plan limits)


Skilled Nursing Facility (SNF) care coinsurance Some plans may include additional innovative benefits.

*Medicare Supplement plans that may cover the Medicare Part B deductible – Medicare Supplement Plans C and F – will be phased out. If you’re not eligible for Medicare until January 1, 2020 or later, you won’t be able to buy Plan C or Plan F. You won’t generally have to give up your Plan C or Plan F if you already have one. If you’re eligible for Medicare before January 1, 2020, you might be able to buy Plan C or Plan F.

Need help?
Call to speak with a licensed insurance agent now.


(239) 495-8888