Understanding Medicare Parts A,B,C, and D

Medicare Parts A and B are provided by the Federal Government through Social Security.

Part A is hospital insurance. It pays for you when you are admitted overnight to a hospital bed and is subject to deductibles and co-payments. It pays for tests, meds, intensive care, everything but the Doctors that treat you there, again, subject to deductibles and co-payments.

Part B pays for all doctors that you will see as well as all outpatient tests, facilities, and lab work that you might have subject to deductibles and co-payments.

Part C also called Medicare Advantage is more commonly known a Medicare Health Maintenance Organization. Medicare HMO’s work in the following way. The money that normally goes to Medicare instead, goes to the insurance company that runs the HMO. The company has a contract with Medicare that it will treat members “similarly” as they would be treated if they were on original Medicare. Generally, HMO’s have a built in Part D drug plan.

Part D is the drug program. The drug programs are run by individual companies. The Government sets stringent rules and guidelines for these programs and has strict supervision over them. If you have Medicare parts A and B and purchase a Medigap (Medicare supplement) plan, you will have to purchase a separate drug program from one of these companies. You will probably not have to purchase a Part D program if you have a medicare HMO.

To summarize:

• If you purchase a Medigap policy, you will have 3 cards. A Medicare A and B card, a Medigap card, and a Part D card.
• If you purchase a Medicare HMO, you will have a Medicare A and B card and a Medicare HMO card.