Medicare Plans

A Comprehensive Guide to Medicare Plans

Medicare is a federal health insurance program based in the United States. This well-established fee-for-service program aims to provide extensive healthcare coverage to lower healthcare bills.

As a national program, Medicare subsidizes healthcare services for older adults aged 65 or above, people with disabilities, and people with end-stage renal disease. 

The US federal government administers Medicare, and the General Revenue and Federal Insurance Contributions Act tax funds it. As of 2023, Medicare has a total of 65,748,297 beneficiaries. 

Medicare provides coverage for prescription drugs, hospital bills, medical equipment, and services. This health insurance company features various medical social insurance programs such as Original Medicare (Parts A and B), Medicare Advantage plans (Part C), Medicare Supplement Plans, and Medicare Prescription Drug Coverage (Part D). 

How Does Medicare Work?

Medicare is primarily designed to meet the ever-growing healthcare needs of senior adults, those with certain disabilities, and those with diseases like end-stage renal disease. 

Medicare features four components that work as an individual plan to help lower hospital bills for inpatient and outpatient care.

The four components offer beneficiaries different types of health insurance coverage. These coverage options require participants to pay their premiums, deductibles, and copays, significantly lowering their hospital bills. 

Type of Medicare Plans

Several Medicare plans are available for beneficiaries. If you fulfill the eligibility criteria, you can enroll yourself into the following Medicare plans. 

• Original Medicare (Part A and Part B)
• Medicare Advantage (Part C)
• Medicare Supplement Plan (Medigap) 
• Medicare Part D (Prescription Drug Coverage)

Let us discuss each plan in detail. 

Medicare Part A and B: Original Medicare

Original Medicare is a health insurance program comprising two parts, Parts A and B, respectively. Medicare Part A (hospital insurance) provides coverage for inpatient care, such as hospital stays, skilled nursing facilities, hospice, and home health care. Thus, Part A primarily covers expenses associated with basic hospital and medical needs, such as semi-private rooms, meals, and medications. 

In contrast, Part B primarily provides coverage for outpatient care, including your doctor’s visit, emergency care, labs, medical supplies, medical equipment, and preventive care. Preventive care includes coverage for screenings for tumors, cancers, or mental health issues. 

Together, Medicare Parts A and B are often called Original Medicare. This is the standard coverage option for beneficiaries. Enrolling in Original Medicare requires you to pay deductibles along with the charges incurred from outpatient and inpatient care.

Original Medicare also provides the benefit of flexibility in accessing any Medicare-collaborating healthcare professional and hospital across the United States without the restriction of out-of-pocket expenses. As of 2024, 33,948,778 people are enrolled in Original Medicare.

Cost of Original Medicare Parts A and B

The Social Security Act’s provisions determine the Medicare Part B premium, deductible, and coinsurance cost. The standard monthly premium for Medicare Part B enrollees is $174.70 as of 2024, an increase of $9.80 from $164.90 in 2023.

The table below provides details. 

Medicare Part A	Medicare Part B
Premium: usually free	Premium: $174.70 per month
Part A covers 80% of your medical expenses. You are responsible for paying the remaining 20% deductibles, copays, and coinsurance.  Part A is premium free if you have paid Medicare tax.  If you do not meet the required Medicare tax to qualify for a free Part A premium, you could pay up to $500 per month.	Part B provides coverage for outpatient services, emergency care, diagnostic testing, and medical supplies. Part B covers some prescription drugs that you administer at a medical facility.  Part B premium depends on your income but has an average cost of $174.70 per month.

Medicare Part C: Medicare Advantage Plans

Beneficiaries can get Medicare coverage through Original Medicare or through a Medicare Advantage plan sponsored by a private health insurance company. 

Medicare Advantage plans, also popularly called Part C plans, are private health insurance plans that collaborate with Medicare. These plans work as an alternative to Original Medicare, consolidating the benefits of Parts A and B with additional benefits through a private insurance provider.

Besides Part A hospital insurance, Part B medical insurance, and Part D drug coverage, Medicare Advantage plans also provide extensive coverage for hearing, vision, and dental care. Some additional benefits include fitness programs, health services, and transportation services (required for medical purposes). 

As of 2024, 31,799,519 people are enrolled in Medicare Advantage plans. However, enrolling yourself in a Medicare Advantage plan means that a private insurance company of your choice will process your Medicare coverage for health services.

The premiums and costs of Medicare Advantage plans vary from provider to provider. Therefore, you must look into the costs associated with each plan. 

Types of Medicare Part C Advantage Plans

There are five types of Medicare Advantage plans available for beneficiaries. 

1. Health Maintenance Organizations (HMOs)

In-network provider, typically called an HMO provider, is an approved healthcare expert within the plan’s network.

In this plan, care is received from a doctor, healthcare provider, or hospital within the network of your chosen plan.  You require a referral from your primary healthcare provider to consult another specialist in emergencies or urgent situations.

2. Preferred Provider Organizations (PPOs)

PPOs allow you to receive medical care from an out-of-network provider but typically cost more.

Also, you’re not obligated to use your primary care doctor, but you incur relatively lower costs for medical experts and hospitals within the plan’s network. 

3. Special Needs Plans (SNPs)

SNPs are dedicated healthcare programs that provide specialized healthcare to individuals with chronic conditions, individuals living in nursing homes, and those who have both Medicaid and Medicare.

4. Private Fee-For-Service Plans (PFFS)

In PFFS, you aren’t obligated to go to a specific healthcare expert within the plan’s network. PFFS plans work like Original Medicare, but you can visit any doctor at any hospital if they agree with the plan’s payment terms and conditions. This plan establishes the pay rate for the doctor, the hospital, and the healthcare provider, as well as your out-of-pocket expense for the care you receive. 

5. Medical Savings Accounts (MSAs)

A high-deductible health plan like MSA requires you to pay an out-of-pocket amount before the healthcare insurance coverage provides any benefits. A savings account is linked to this plan. Medicare adds money to this account each year. You can spend this money on healthcare services. 

Medicare Supplemental Plans (Medigap)

A Medicare Supplement Plan, also known as Medigap, is a secondary coverage plan offered by private companies. Its primary purpose is to provide additional health insurance for out-of-pocket costs that Original Medicare doesn’t cover.

This means that Medigap only covers what isn’t covered by Original Medicare. Therefore, Medigap only fills the gap in the Original Medicare coverage. Due to this, having access to Original Medicare is a prerequisite for enrolling in Medigap policies. This also explains why Medigap is not a stand-alone policy in the US.

Since Part A and Part B provide limited coverage, Medicare Supplement Plans cover the cost of out-of-pocket expenses. These include copayments, coinsurance, and deductibles. 

• Deductibles are expenses that you cover before Medicare provides coverage for health services. Thus, deductibles apply to all Medicare Parts.

• A copayment is a fixed payment for a doctor’s visit or a prescription drug. This amount is paid only after you pay your deductibles, thus covering certain benefits.

• Coinsurance is a cost-sharing method where you have to pay a percentage of the total amount for specific services after paying your deductibles. Your insurance plan covers the rest of the cost.

There are about ten different standardized Medigap policies in the US. The most popular plans are plans A, B, C, D, F, and G, and plans K, L, M, and N.

According to the rules and regulations set by the Centers for Medicare and Medicaid Services (CMS), every plan must provide beneficiaries with the same coverage. For example, all plan Gs across the State offer the same benefits to enrollees. However, the cost of a Medicare supplement insurance plan varies from provider to provider and State to State.

If you want to look into the available Medigap plans, you can contact Silveredge to compare various plans in your region and make a cost-efficient decision. Here are the most common Medigap plans offered to beneficiaries across the US. 

Plan F and G 

Medigap Plans F and G are high-deductible plans. For this plan, beneficiaries must pay coinsurance, copayment, and deductibles before Medicare can pay for their separate deductible for foreign travel/emergency care. 

Plan K and L 

You must pay your out-of-pocket yearly limit and the yearly Part B deductible, after which Medigap pays for 100% of the covered services for the remaining calendar year. 

Plan N 

Plan N covers all Part B medical services, but you’ll have to pay up to $20 for some doctor’s visits and up to $50 if you go to the emergency room and aren’t admitted to the hospital.

What Does Medicare Supplement Cover?

Medicare Supplement Plans fill the gaps in Original Medicare (Part A and Part B). These plans generally offer the following. 

Coinsurance and Copayments	Medigap helps cover the cost of medical services or hospital stays after you’ve paid your Medicare deductible.
Deductibles	Some Medigap plans cover Medicare Part A and Part B deductibles, which are the amounts you have to pay out-of-pocket before Medicare begins to pay.
Excess Charges	Certain plans, such as plans F and G, cover excess charges, which you might incur if a healthcare provider charges more than the Medicare-approved amount for a service.
Foreign Travel Emergencies	Some Medigap plans offer coverage for emergency medical care when traveling outside the US.
Skilled Nursing Facility Care	Medigap helps cover costs associated with stays in skilled nursing facilities. This coverage is not available with Medigap plans A, B, K, and L.
Blood	Medigap plans pay for the first three pints.

Medicare Part D: Prescription Drug Coverage

Medicare Part D, also called Prescription Drug Coverage, is designed to cover the cost of prescription medications. Beneficiaries with Original Medicare are eligible for Part D regardless of income, resources, and health status.

Private health insurance companies offer Part D plans. These plans help cover the cost of drugs, significantly lowering medicine bills for long-term treatments. As of 2024, 51,591,776 people are enrolled in Medicare Part D.

The cost for Part D includes a monthly premium that may vary from provider to provider. A yearly deductible also applies with copayments and coinsurance for medications.

Beneficiaries must annually review their drug prescriptions before the open enrollment period to make changes to their plan in case of a difference in the formulary. Overall, Prescription Drug Coverage provides substantial assistance with the cost of prescription medications.

Cost of Medicare Plans

The cost of Medicare plans varies depending on the type of coverage you choose. Generally, Part A of Original Medicare has premiums, deductibles, and coinsurance rates set federally, while Part B is income-based. 

In contrast, Medicare Advantage plans have varying costs depending on the type of coverage and supplemental benefits it offers. The cost of Medigap policies varies from provider to provider, while Prescription Drug Coverage has additional cost-determining factors. 

Let us look into the estimated costs for Medicare plans in 2024. 

Original Medicare	Medicare Advantage	Medigap	Part D
Part A premium: $0 to $506 per month. The standard monthly premium for Medicare Part B enrollees is $174.70 as of 2024, an increase of $9.80 from $164.90 in 2023.	The estimated average monthly Medicare Advantage plan premium for 2024 is $18.50, but this cost may vary based on the level of coverage you receive.	Ranges from $50 to $300.	The average monthly premium for Medicare Part D is projected to be approximately $55.50 as of 2024.

Eligibility Criteria for Medicare 

What makes you eligible for Medicare? Eligibility for Medicare depends on several factors. In general, Medicare has the same eligibility criteria across all the States. You qualify for Medicare if: 

• You are 65 years old or above 
• You have a medical disability 
• You have end-stage renal disease (ESRD)
• You have amyotrophic lateral sclerosis (ALS) 

Besides this, you must also be approved by the Social Security Administration for either your age or disability to be eligible for Medicare.

Enrollment Period for Medicare Plans

Medicare has certain enrollment periods during which you can sign up for a Medicare plan or switch your existing plans. Here are different enrollment periods for Medicare. 

• Initial enrollment period (IEP): The initial enrollment period is 7 months, starting 3 months before your 65th birthday and ending 3 months after you turn 65. If you haven’t had Medicare before, you can enroll during this period. 

• General enrolment period (GEP): If you miss your IEP, you can access Medicare by applying for it during the general enrollment period (GEP) between January 1 and March 31 every year. You can choose Original Medicare, Medicare Advantage, Medigap, or Part D. During this period, you can also make changes to your current Medicare plans. For example, if you have Original Medicare and you want to switch to a Medicare Advantage plan, you can do so during this period.

• Open enrollment period (OEP): You can join, switch plans, or drop your coverage plans from October 15 to December 7 each year.

• Special enrollment period: Most of the time, when you join Medicare, you have to keep the plan for the entire calendar year starting on the date your coverage begins. If you want to change your Medicare Advantage plan for any reason, such as losing your insurance or moving States, under that scenario, you might be eligible to switch plans during this period. 

How to Apply for Medicare?

You can apply for Medicare online, through mail, or by visiting your nearest Social Security Office. If you have been receiving your Social Security benefits, you will automatically be enrolled in Parts A and B of Original Medicare. 

You receive your Medicare ID in the mail before you turn 65th. However, if you’re new to Medicare, you can sign up during the initial enrollment period, which begins three months before your 65th birthday.

For a straightforward procedure, you can seek professional advice from Silveredge’s licensed advisors as they help resolve Medicare queries and streamline the enrollment procedure for you. 

Comprehensive Comparison of Medicare Plans

Here is a comprehensive comparison of Medicare plans to provide a high-level overview of the differences between Medicare’s four components. 

Feature	Original Medicare (Parts A and B)	Medicare Advantage (Part C)	Medicare Supplement (Medigap)	Prescription Drug Coverage (Part D)
Description	Includes Medicare Part A (Hospital Insurance) and Part B (Medical Insurance).	Bundled Medicare Part A and B are provided through private insurance companies.	Supplementary insurance that covers gaps in Original Medicare.	Private drug plan to cover the cost of drugs, significantly lowering medicine bills for long-term treatments.
Premiums (cost)	For Part B-covered services, you usually pay 20% coinsurance. There’s no yearly limit on what you pay out of pocket, unless you have supplemental coverage.	Often includes premiums (some plans may have a $0 premium), deductibles, copays, and coinsurance.	Only monthly premiums, deductibles for Medicare Part B, copays, and coinsurance.	Includes a monthly premium that may vary from plan to plan. A yearly deductible also applies with copayments and coinsurance for medications.
Coverage	Covers most medically necessary services and supplies. Original Medicare doesn’t cover some benefits like eye exams, dental care, and routine checkups.	Covers all Part A and Part B services. May include extra benefits like coverage for vision, dental, and prescription drugs.	Covers copayments, coinsurance, and deductibles not covered by Original Medicare.	Provides coverage for prescription medications.
Prescription Drugs	Not included.	Often included in the plan.	Prescription Drug Coverage must be obtained separately through Medicare Part D.	Included.
Enrollment Period	Can join or switch plans during specific times of the year.	Can join or switch plans during specific times of the year.	Can be purchased any time after enrolling in Medicare Part B.	Can join or switch plans during specific times of the year.
Eligibility	Must be approved by the Social Security Administration for either your age or disability.	Must have Medicare Parts A and B. You cannot have both a Medicare Advantage plan and a Medigap policy.	Must have Medicare Parts A and B. Cannot be used with Medicare Advantage.	Must have Medicare Parts A and B.

Choose the Right Medicare Plan With Silveredge

Medicare offers four primary types of healthcare coverage options to beneficiaries. While the standard type of plan is Original Medicare, beneficiaries can also switch to plans such as Medicare Advantage to avail of extra benefits.

These additional components of Medicare offered by private health insurance companies not only help lower hospital bills but also provide beneficiaries with peace of mind.

If you require help sorting through your Medicare options, Silveredge has licensed advisors committed to providing professional advice. Our advisors with industry expertise can help you explore your Medicare coverage options, compare plans in your region, and find a plan that best suits your healthcare needs.

Through unbiased advice, you can enroll in a Medicare plan that not only helps lower your healthcare bills but also meets your ever-growing healthcare needs. Contact Silveredge today to get accurate, straightforward, and unbiased advice!