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Medicare Eligibility Requirements

Originally, Medicare covered people age 65 and over. Later, the program expanded to include people with permanent disabilities as well as end-stage renal disease (severe kidney disease). There are a few extra eligibility requirements, however.

To receive Medicare, you have to be eligible for Social Security. For someone age 65 or over, this means you have to have worked for a minimum of ten years (non-consecutive) at a job that withheld Social Security from your pay.

Note: People under age 65 can sometimes receive Social Security, but they are still not eligible for Medicare until they turn 65. While changes to Social Security will push the age at which benefits begin to 67, Medicare eligibility will still start at 65.

People with disabilities or end-stage renal disease (ESRD) who want Medicare coverage have to meet the Social Security Administration's definition of permanently and totally disabled or end-stage renal disease, respectively.

Medicare provides partial coverage for certain medical services. The main coverage has two parts, Part A and Part B.

Original Medicare

Medicare Parts A and B are known as Original Medicare. While Original Medicare allows you to visit any doctor that accepts Medicare, the coverage is somewhat limited, and Part B carries deductibles and co-payments. These coverage exceptions and costs are "gaps" in Medicare. You can purchase health insurance from a private company to cover these gaps, or MediGap Insurance. MediGap providers must follow federal guidelines and must clearly identify their policy as Medicare Supplement Insurance.

Medicare Part A
Part A is also known as Hospital Insurance, or HI. People who are eligible for Medicare can usually get Part A coverage without having to pay a monthly premium, because they have already paid into the system with their Social Security withholdings.

Part A covers hospital stays including meals, supplies, necessary testing and a semi-private room. A private room is not covered unless it is medically necessary. Rehabilitation and other skilled nursing services are covered. Home health care is covered, but only if it is medically necessary, and only on a part-time, intermittent basis. This includes physical, occupational and speech therapy when conducted by a Medicare-approved health agency. Certain medical equipment, such as walkers, wheelchairs and other supplies are also covered. Finally, Part A covers hospice care for terminally ill patients, including drugs and support services for symptom treatment and pain relief.

Most people do not pay a monthly Part A premium because they or a spouse has 40 or more quarters of Medicare-covered employment. Note: The Part A premium is $244.00 per month for people having 30-39 quarters of Medicare-covered employment. The Part A premium is $443.00 per month for people who are not otherwise eligible for premium-free hospital insurance and have less than 30 quarters of Medicare-covered employment.

For each benefit period Medicare pays all covered costs except the Medicare Part A deductible (2009 = $1,068) during the first 60 days and coinsurance amounts for hospital stays that last beyond 60 days and no more than 150 days.

Medicare Part B
Part B is sometimes referred to as Medical Insurance, or MI. There is a monthly premium for Part B. The monthly premium for Part B in 2009 is $96.40 per month. Patients must also meet an annual deductible before coverage kicks in. If your income is above $85,000 (single) or $170,000 (married couple), then your Medicare Part B premium may be higher than $96.40 per month.  For additional details, see our FAQ titled: " Medicare Part B Monthly Premiums in 2009"

The insurance provided by Part B covers medically necessary doctor's appointments. This includes outpatient medical and surgical services, diagnostic tests and some medical equipment. It also offers coverage for home health care. It does not cover routine checkups, except for a one-time "Welcome to Medicare" exam.

Together, parts A and B are known as Original Medicare. While Original Medicare allows you to visit any doctor that accepts Medicare, the coverage is somewhat limited, and Part B carries deductibles and co-payments. These coverage exceptions and costs are "gaps" in Medicare. You can purchase health insurance from a private company to cover these gaps, or MediGap Insurance. MediGap providers must follow federal guidelines and must clearly identify their policy as Medicare Supplement Insurance.

Medicare does not cover dental work, cosmetic surgery, health care services obtained outside the United States, hearing tests, long-term care, routine eye care, eyeglasses, most shots or long-term care.

Medicare Part D
Medicare Part D is a federal program to subsidize the costs of prescription drugs for Medicare beneficiaries in the United States. It was enacted as part of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) and went into effect on January 1, 2006.

Beneficiaries can obtain the Medicare drug benefit through two types of private plans: beneficiaries can join a Prescription Drug Plan for drug coverage only or they can join a Medicare Advantage plan (MA) that covers both medical services and prescription drugs (MA-PD). Note: The latter type of plan is actually part of Medicare Part C and has several other differences relative to original Medicare. Not all drugs will be covered at the same level, giving participants incentives to choose certain drugs over others. This is often implemented via a system of tiered formularies in which lower-cost drugs are assigned to lower tiers and thus are easier to prescribe or cheaper.

Most Medicare beneficiaries must affirmatively enroll in a Part D plan to participate. Dual eligible's (those also in Medicaid) are automatically enrolled in one of the less expensive Prescription Drug Plan in their area, chosen at random. If the dual-eligible person is already enrolled in a Medicare Advantage plan -only plan, then they are automatically removed from the Medicare Advantage plan upon enrollment in a Prescription Drug Plan.

Part D drug coverage excludes drugs not approved by the Food and Drug Administration, those not for use in their medically accepted indication, drugs not available by prescription for purchase in the United States, and drugs for which payments would be available under Parts A or B of Medicare.

Part D coverage excludes drugs or classes of drugs which may be excluded from Medicaid coverage. These may include:

• Prescription vitamins and mineral products, except prenatal vitamins and fluoride preparations
• Drugs used for cosmetic purposes (hair growth, etc.)
• Drugs used for the symptomatic relief of cough and colds
• Drugs used to promote fertility
• Drugs used for erectile dysfunction
• Drugs used for anorexia
• Drugs used for weight loss, or weight gain
• Drugs where the manufacturer requires as a condition of sale any associated tests or monitoring services to be purchased exclusively from that manufacturer or its designee
• Barbiturates
• Benzodiazepines

While these drugs are excluded from basic Part D coverage, drug plans may include them as a supplemental benefit, provided they otherwise meet the definition of a Part D drug. However plans that cover excluded drugs are not allowed to pass on those costs to Medicare, and plans are required to repay CMS if they are found to have billed Medicare in these cases

What Medicare Covers

Medicare covers hospital stays, home health care, and hospice care under Medicare Part A. This includes:

• A semi-private room
• Meals
• Nursing
• Hospital services and supplies
• Inpatient mental health care (lifetime limit of 190 days)

Home health care benefits include:

• Part-time or intermittent skilled nursing care
• Home health aide services
• Physical and occupational therapy
• Speech therapy
• Medical social services
• Durable medical equipment (wheelchairs, walkers, etc.)
• Medical supplies

Hospice care is for people with a terminal illness. It covers:

• Doctors' services
• Nursing care
• Durable medical equipment (wheelchairs, walkers, etc.)
• Medical supplies (bandages, catheters, etc.)
• Drugs to control symptoms
• Drugs for pain relief
• Short-term hospital care
• Short-term respite care (although this requires a small co-payment)
• Home health aide services
• Homemaker services
• Physical and occupational therapy
• Speech therapy
• Social worker services
• Dietary counseling
• Grief and loss counseling for you and your family

Under Medicare Part B Covers Medical and Other Services, such as:

• Doctors' services (including office visits, but not routine physical exams)
• Outpatient medical and surgical services and supplies
• Diagnostic tests
• Ambulatory surgery center facility fees for approved procedures
• Durable medical equipment (such as wheelchairs, walkers, etc.)
• Second and sometimes third surgical opinions
• Outpatient mental health care
• Outpatient occupational and physical therapy
• Speech therapy

What Medicare Does Not Cover

With a few exceptions, these things are not covered by Medicare Parts A or B:

• Acupuncture
• Cosmetic surgery
• Custodial care (help with bathing, dressing, eating, and using the bathroom)
• Foot care
• Dental care and dentures
• Diabetic insulin and syringes - will be covered under Part D
• Eyeglasses and eye exams
• Hearing aids and hearing exams
• Health care outside the United States
• Long-term nursing home care, if you only need help with daily activities
• Orthopedic shoes
• Prescription drugs (Medicare Part D  covers drugs)
• Routine or yearly physical exams (If your Part B coverage began on or after January 1, 2005, Medicare will cover a one-time only physical exam within the first 6 months of coverage.)

To find out about specific things that Medicare covers, visit the Publications page at www.medicare.gov. Download "Your Medicare Benefits." You can also get a printed booklet by calling (800) MEDICARE (800-633-4227).

Medicare Advantage (formerly called Medicare + Choice)

Medicare Advantage plans are health insurance policies you can buy from private companies. A Medicare Advantage plan replaces your traditional Medicare plan. They must offer all the services that traditional Medicare does. Medicare Advantage plans may also offer:

• Prescription drug benefits
• Dental Services
• Hearing examinations and hearing aides
• Eye examinations and glasses
• Additional preventive services

To find and compare Medicare Advantage plans offered in your area, use Medicare's Personal Plan Finder.

MediGap Supplemental Insurance

A Medigap policy is health insurance sold by private insurance companies to fill the "gaps" in Original Medicare Plan coverage. Medigap health insurance policies help pay some of the health care costs that the Original Medicare Plan doesn't cover. If you are in the Original Medicare Plan and have a Medigap policy, then Medicare and your Medigap policy will pay both their shares of covered health care costs.

Insurance companies can only sell you a "standardized" Medigap policy. These Medigap policies must all have specific benefits so you can compare them easily.

You may be able to choose up to 12 different standardized Medigap policies. They are identified as Medigap Plans A through L. Each plan, A through L, has a different set of basic and extra benefits.

Medigap policies must follow Federal and State laws. A Medigap policy must be clearly identified on the cover as "Medicare Supplement Insurance."

It's important to compare Medigap policies because costs can vary. The benefits in any Medigap Plan A through L are the same for any insurance company. Each insurance company decides which Medigap policies it wants to sell.

Generally, when you buy a Medigap policy you must have Medicare Part A and Part B. You will have to pay the monthly Medicare Part B premium. In addition, you will have to pay a premium to the Medigap insurance company.

You and your spouse must each buy separate Medigap policies. Your Medigap policy won't cover any health care costs for your spouse.

For additional information on Medigap policies, including why you would want to buy a Medigap policy and information about what Medigap policies cover, please read the publication, Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.

How to Enroll in Medicare

To enroll in Medicare you will not need to do anything. You will be automatically enrolled in Medicare Part A and Part B effective the month you are 65. For example, if your 65th birthday is February 20, 2001, your Medicare effective date would be February 1, 2001. (Note: if your birthday is on the 1st day of any month, Medicare Part A and Part B will be effective the 1st day of the prior month. For example, if your 65th birthday is February 1, 2001, your Medicare effective date would be January 1, 2001.) Your Medicare card will be mailed to you about 3 months before your 65th birthday. If you do not want Medicare Part B, follow the instructions that come with the card. For complete information on enrollment see the Initial Enrollment Package section.

Medicare Enrollment Penalties

When Medicare began in 1966, Congress wanted everyone eligible to sign up for Part B so the premium income would help pay for the program. A penalty of 10 percent per year was mandated for late filing to encourage people to buy Part B coverage at age 65. The monthly premium in 1966 was $3, and the penalty for filing one year late then was only 30 cents per month for twelve months. Currently, the penalty for delaying for one year is $4.38 per month, almost 15 times the original penalty. If a person files 10 years late, the penalty is 100 percent, or $43.80 per month, for a total monthly premium of $87.60. This is a harsh penalty due to the tremendous increase in the cost of living since 1966.

The premium penalty also applies to people who have not enrolled in the Medicare Part D Prescription Plan. The penalty is currently increased 1% for each month until the beneficiary enrolls in a Medicare Part D Plan. This percentage is then multiplied by the average premium cost for Medicare Part D plans. In 2009 the average premium for part D coverage was $28.

How will this work? Well, if this year's average monthly premium for a Medicare Part D plans is $28.00 per month, a person who waited 7 months to enroll in a Medicare Part D plan would add an extra $1.96 per month to their monthly premium (calculated - 1.07 * $28.00 = $29.96). This would equate to an additional $23.52 per year ($2.96 x 12 months).

If a person waited 3 years to enroll in a Medicare Part D plan would add an extra $1.96 per month to their monthly premium (calculated - 1.36 * $28.00 = $38.08 or an additional $120.96 per year). The extra premium "penalty" will stay in effect for the life of the Beneficiary's Medicare Part D plan and may even increase over time.

The premium "penalty" will stay in effect for the life of the Beneficiary's Medicare Part D plan and may even increase over time. So, as you can see it is important to enroll as so as you are eligible so not to be penalized.

Medicare Prescription Drug Coverage

Everyone with Medicare, regardless of income, health status, or prescription drugs used, can get prescription drug coverage.

• Basic Information. Basic information about Medicare prescription drug coverage, what it is, who can get it, when you can get it, how you can get it and why you should get it.

• Things to Consider. Information about how to look at the cost, coverage, and other important factors of Medicare drug coverage when selecting a plan that meets your needs.

• Common Situations. To help you get started thinking about Medicare drug coverage, find the situation that describes you and find out what you need to do.

Other Medicare Resources

• Medicare Enrollment Form. Online Medicare Enrollment Form.

• Medicare FAQs regarding Benefits, Rights and Protections:. Summary of Medicare benefits, rights and protections, and answers to the most frequently asked questions about Medicare.

• Information About the Medicare Premiums, Deductibles, and Coinsurance Rates. Click here for Fact Sheet titled, "CMS Announces Medicare Premiums, Deductibles for 2009" on the www.cms.gov website.

• Medicare Prescription Drug Plan Finder. An interactive tool that allows you to narrow your search for a Medicare prescription drug plan based on your personal preferences such as cost, drugs covered and participating pharmacies.

• Formulary (Drug) Finder. An interactive tool that finds plans in your area whose formularies cover drugs you use.

• Medicare Prescription Drug Plan Enrollment Center. A online tool to join the Medicare drug plans.

• Medicare Partners. Information and tools for people and organizations assisting those with Medicare who are considering Medicare prescription drug coverage.

• Additional Medicare Drug Plan Details for Partners. Download lists of all National plans, all Stand-alone Prescription Drug Plans and their 2009 Regional Low-Income Premium Subsidy Amounts, and all Medicare Advantage and Other Medicare Health Plans.

• Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare.

• Medicare Publications. View, print or order Medicare publications.

• Other Medicare Resources. Access other Medicare and other health related resources.
  

About the Author

Jeff Behar, MS, MBA

Jeff Behar, MS, MBA is a recognized health, fitness and nutrition expert, regularly writing about hot topics in the areas of health, fitness, disease prevention, weight loss, nutrition, anti aging and alternative medicine. Jeff Behar's work also often appears in several of the major health and fitness newsletters, health and fitness magazines, and on major health, fitness, and weight loss websites.