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Senior Care Solutions: What is Medicare?

Generous benefits are available to help pay for assisted living, in-home care, and nursing home care.

What is Medicare?

30-second summary:

  • Medicare is the federal government’s national health insurance program made available to anyone age 65 or older.
  • Medicare only pays for a temporary stay in a skilled nursing facility when transitioning from a significant hospital stay to home or assisted living.
  • There are 4 parts to Medicare: Part A is hospital coverage, Part B is regular health insurance, Part C is a supplemental program to limit out-of-pocket costs, and Part D is prescription drug coverage.
Medicare is the health insurance program that most Americans receive on the first day of the month that they turn 65 years old. It is very good coverage however it does not cover everything. The gaps in traditional Medicare can be covered with private insurance policies called Medicare Supplement Plans or Medicare Advantage plans. Those who retired from companies that offer retirement health care benefits have plans that are usually good plans. Those plans can vary as to what they do and do not cover. All of these policies help cover many of the out-of-pocket costs not covered by traditional Medicare. One common misconception is that Medicare covers long term care stays in assisted living facilities and nursing homes. While there is coverage for some rehabilitation care after a qualifying stay in a hospital; neither Medicare or Medicare Supplement or Advantage policies typically pay for the daily room and board cost while residing in an assisted living or long- term care facility. Medicaid is a program that can help pay for long term care stays in both assisted living and long-term care facilities. These programs can work together to cover costs however it is important to know where one coverage ends and the next one begins. There are different eligibility requirements for all the programs discussed above. At Senior Solutions Consulting, we specialize in asset protection for those facing long-term care challenges. An initial consultation with us is always free. Call us at 317-863-0213 to schedule an appointment.

National Health Insurance Program for Seniors: Medicare

Medicare is a national health insurance program in the United States that began in 1966 under the Social Security Administration (SSA) and is now administered by the Centers for Medicare and Medicaid Services (CMS). It primarily provides health insurance for Americans aged 65 and older, but also for some younger people with disability status as determined by the SSA, and people with end stage renal disease and amyotrophic lateral sclerosis (ALS or Lou Gehrig’s disease). Disability status includes being on or applying for Social Security Income or Social Security Disability.

How Much Coverage does Medicare Provide?

You must be enrolled in Medicare to receive benefits. The majority of a person’s health care costs are covered by the plan however, there are co-pays and deductibles when services are provided. Private health insurance plans usually known as Part C and Part D can cover a large part of the deductibles and co-pays that traditional Medicare does not.

A Very Brief History of Medicare

President Dwight D. Eisenhower convened the first White House Conference on Aging back in 1961 and they began discussing a program to provide healthcare for Social Security beneficiaries. Four years later, in 1965, President Lyndon B. Johnson pushed for the creation of Medicare in an amendment to the Social Security Act to provide health insurance to older Americans regardless of their income or medical history. Before Medicare was created, 40% of those receiving Social Security had no health insurance due to the high cost of coverage for the older population.

Medicare began as part of the Social Security Administration (SSA) but is now administered by the Centers for Medicare and Medicaid Services (CMS). It is paid for through payroll taxes, beneficiary premiums, deductibles, co-pays, and general United States Treasury revenue. In 2019 around 60 million people were enrolled, made up of 52 million people at least 65 years of age and another eight million younger people who qualify.

The Four Parts of Medicare

The four different parts of Medicare are:
Part A

Part A is hospital insurance to cover some or all of the cost of formally being admitted into a hospital for inpatient care and medical attention. It can also cover skilled nursing care (rehab) when coming out of the hospital from at least a three-day stay (not for custodial care). This part can also cover hospice services. Below are the Part A benefits:

Services Media Coverage Patient’s Responsibility
Physician Services 90 days per benefit period*, plus 60 day lifetime reserve services include:

  • Semi-private room
  • Meals
  • Routine nursing care
  • Lab tests and x-rays (billed by hostpital)
  • Medical supplies and equipment
  • Rehabilitation therapies
  • $1340 deductible per benefit period
  • $335 coinsurance per day for days 61-90
  • $670 coinsurance per day for lifetime reserve days expenses beyond 90 days unless lifetime reserve days are chosen

Services not covered:

  • Personal convenience items
  • Private duty nurses
  • Extra charges for a private room
Outpatient Medical Services & Supplies at a Hospital 100 days per benefit period in a nursing facility Medicare-certified skilled unit (three day Medicare covered inpatient hospital stay and physician confirmation that there is a need for daily skilled nursing and/or rehabilitative care required prior to utilization of skilled nursing facility care)

  • Semi-private room
  • Meals
  • Routine nursing care
  • Rehabilitation therapies
  • Medical supplies & use of equipment
  • Medications furnished by facility
  • Laboratory services
  • X-ray services
  • Pharmacy services
  • $167.50 ciinsurance per day for days 21-100
  • Expenses beyond 100 days of treatment are NOT covered.

Services not covered:

  • Personal convenience items
  • Private duty nurses
  • Extra charges for a private room
  • Custodial nursing care
Ambulance 100% of eligibility requirements are met $0 if Home Health Care criteria coverage is met
Respite Care Unlimited coverage of services including nursing care, physician Services, medications, medical supplies and appliances, outpatient physical, occupational and speech therapies, home health aide, home-maker services, respite care and counseling 5% of the medicare-approved amount for inpatient respite care
Part B

Part B is medical insurance that covers some or all of the costs for a variety of other health services, including outpatient services, some provider services while an inpatient in a hospital, outpatient hospital charges, office visits to healthcare providers (some of which are housed in hospitals and do involve admittance), and many prescription drugs that are required to be administered professionally. Below are the Part B benefits.

Services Media Coverage Patient’s Responsibility
Physician Services 80% of Medicare allowable charges*
  • $183 deductible per calendar year
  • 20% coinsurance after Medicare
  • Amounts billed in excess of allowable charges
Outpatient Medical Services & Supplies at a Hospital 80% of Medicare allowable charges* 80% of Medicare allowable charges*
Ambulance 100% of eligibility requirements are met
  • $183 deductible per calendar year
  • 20% coinsurance after Medicare
  • Amounts billed in excess of allowable charges
Respite Care No benefit 100% respite care cost
Prescription Drugs Benefits are available under Medicare Part D
Part C
Part C is a supplement for those enrolled in both Parts A and B that helps cover the out-of-pocket expenses for medical care not covered by parts A and B. A Part C plan is an insurance policy offered by private insurance companies approved by the Centers for Medicare and Medicaid Services (CMS). When a person enrolls in a Medicare Advantage Plan, the insurance company will cover all of Part A, Part B, and sometimes Part D coverage. Medicare Advantage Plans often offer extra coverage above and beyond traditional Medicare benefits such as vision, hearing, dental, and/or wellness programs. Although the plans are governed by CMS, they are not obligated to follow the same co-pays, deductibles, and out-of-pocket expenses applicable to traditional Medicare.

Each company has different rules that define which providers (hospitals, physicians, and skilled nursing facilities) members can see. Some allow members to seek care at any Medicare-approved provider, while most plans require members to seek care from a contracted provider to avoid higher out-of-pocket expenses. Members and healthcare providers should contact the insurance company to determine benefits and eligibility for specific healthcare providers and healthcare services. Many Medicare Advantage Plans require healthcare providers to secure Prior Authorization from their Care Coordination Department. In an effort to contain costs, the service may be denied for financial coverage if the insurance company determines there is no medical necessity.

Some Medicare Advantage Plans waive the 3-day hospital stay required for inpatient skilled nursing and rehabilitation under traditional Medicare.

Part D

This is coverage for self-administered prescription drugs.

Medicare coverage of rehabilitation

Medicare covers a certain amount of rehabilitation days, usually the first 20, after a qualifying hospital stay. A qualifying hospital stay is 3 days of admission to the hospital not considered observation. Rehabilitation provides care to ensure a patient is healthy enough and ready to return home safely.
Here are the eligibility criteria for Medicare coverage of skilled nursing care:
  • You must have had a prior inpatient hospital stay of at least three days, with one of those days being while Medicare eligible, not counting the day of hospital discharge.
  • Your admittance to a Medicare-approved skilled nursing facility must be within 30 days of discharge from the hospital or within 30 days of a previous Medicare covered stay.
  • Your doctor must have certified that following your hospital stay, you require a daily skilled service provided by a licensed nurse or therapist in a certified Medicare unit.
Coverage under this type of care usually includes the following:
  • Room and Board
  • Routine Nursing Care
  • Medical Supplies & Complex Equipment l Pharmacy
  • Physical, Occupational & Speech Therapy l Respiratory Therapy
  • Oxygen
  • Lab Services l X-Ray
  • EKG
  • IVs
From day 1 to day 20 of your skilled nursing facility stay, you pay only for the non-covered services you receive. Non-covered services include a private room (unless medically necessary) and personal convenience items, such as a private phone and television.

From day 21 to day 100 of your skilled nursing facility stay, you pay a daily coinsurance amount, which is established annually by Medicare, for the covered services you receive, and continue to pay the full amount for any non-covered services. You must be benefiting from the services and participating in the treatment plan to remain in the program.

If your skilled nursing facility stay goes beyond 100 days, Medicare payments end, and you become fully responsible for all nursing care charges incurred during the remainder of your stay. If your condition improves during the 100 day benefit period, and you no longer meet Medicare criteria for coverage, the facility will notify you that your Medicare Part A coverage has ended.

Avoiding Medicare Fraud and Scams

There are several scams designed to prey upon seniors. It is important for everyone to be alert to dangerous situations that may financial or physically harm a person. Becoming involved in a seniors financial affairs is the best way to make sure that there is no abuse taking place. Seniors can be very trusting of others. This makes them vulnerable to scammers. After someone has been scammed they are most likely to embarrassed to admit it or seek help to rectify the situation. Sometimes they may not be aware that they have even been taken advantage of. If you suspect that something is “off” or doesn’t seem right, learn how to report Medicare fraud.

Your Partner in Long-Term Care Issues: Senior Solutions Consulting

At Senior Solutions Consulting, we understand you want the very best for your aging loved one while also protecting their hard-earned life savings. A major challenge in achieving the best outcome for your loved ones is navigating the maze of options and requirements regarding Medicaid, Medicare, waivers for in-home care, and/or veteran’s benefits. The good news is that you do not have to do this on your own. Our sole job at SSC is helping you maximize the benefits available to your older loved ones. We have helped more than 1,500 Indiana families since 2000. When you are not sure where to turn, Senior Solutions Consulting is ready to help. Our initial consultation is always free. Getting in touch with us is as easy sending an email through the contact us page of our website, or calling us directly at 317-863-0213. We look forward to helping achieve peace of mind about the long-term care of your aging loved ones!

When you have questions about benefits for long-term care, SSC has answers!