Get the basics on what Medicare is and how it works.
When it comes to Medicare, there are many different plan options. Choosing the one that is right for you can be challenging. We’ve pulled together clear information on how Medicare works. That way, you can make a more informed decision about your health care.
Medicare is a federal government-run health care program started in 1965 for U.S. citizens or legal permanent residents age 65 and older. It’s often known as Original Medicare or Medicare Part A and Part B. Since 1972, people under 65 with certain disabilities are also eligible for Medicare. People of all ages with permanent kidney failure, who need dialysis or a kidney transplant, are eligible for Medicare as well.
Once you have Medicare, you can visit health care providers if they accept Medicare and are taking new Medicare patients. This includes doctors, hospitals and other facilities.
Do you want more information about whether you can sign up for Medicare? Do you have questions about how to sign up for a Medicare Advantage plan? If so, you can:
- Visit the CMS website at www.medicare.gov
- Call 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week
Medicare Part A
Medicare Part A is a hospital insurance plan that covers:
- Hospital stays
- Skilled nursing facility care
- Inpatient care
- Hospice care
- Some home care
You can enroll in Medicare Part A when you become 65, even if you have not retired. The government will automatically enroll you in Medicare if you’re already receiving Social Security disability benefits. Otherwise, they’ll send you an initial enrollment period package three months before your 65th birthday. Or, if you already receive disability benefits, they’ll send you the enrollment package in the 25th month after you started receiving benefits.
Medicare Part B
Medicare Part B is a medical insurance plan. It covers medically necessary services that Medicare Part A doesn’t cover. This includes:
- Health care provider office visits
- Outpatient care
- Medical items such as wheelchairs, walkers and oxygen equipment
Medicare also covers some preventive health services, such as health screenings and annual wellness visits.
Enrolling in Medicare Part B is optional. As part of the Medicare Part B plan, you’ll have certain costs:
- You’ll need to pay a monthly premium based on your income.
- If you get health services that Medicare does not consider preventive services, you will need to pay a deductible. A deductible is the amount of money you need to pay before Medicare will pay for these services.
- You will also need to pay out-of-pocket (using your own money) for some medical procedures or costs. If you have additional insurance called Medigap, it may cover some of these costs.
Medicare Part C (Medicare Advantage)
The federal government created Medicare Part C in 2003. Medicare Part C is also called Medicare Advantage. A Medicare Advantage plan combines Part A (hospital insurance) and Part B (medical insurance). The government requires Medicare Advantage plans to cover all medically necessary services.
Medicare Advantage plans may also provide extra benefits such as:
- Wellness programs
Some Medicare Advantage plans also include prescription drug coverage. You may have to pay a deductible. However, copays for routine medical visits are usually a set cost. There is also a limit on the out-of-pocket health care costs you will have to pay each year. After you pay that amount, your Medicare Advantage plan will pay for everything else until the start of the next year.
To enroll in a Medicare Advantage plan:
- You must first enroll in Original Medicare Part A and Part B.
- You need to sign up for a Medicare Advantage plan through an approved private insurance company. Medical Advantage plans may be PPOs, HMOs or private fee-for-service plans.
People with certain Medicare Advantage plans may be able to select an OptumCare provider. Find out when and how you can join OptumCare™ Medical Group.
Medicare Part D
Medicare Part D is a prescription drug insurance plan. The federal government created Part D in 2006. Private companies approved by the federal government run the program.
If you have Medicare Part A, Medicare Part B and/or Medicare Advantage, you are entitled to purchase Medicare Part D. If you have this prescription drug plan, Medicare will usually cover some of the cost of prescription drugs. You will need to pay the rest.
To enroll in Medicare Part D, you’ll need to find a prescription drug plan in your area. You can either enroll in a Part D plan that only covers prescription drugs, or a combined Medicare Advantage Prescription Drug plan. This type of plan covers both medical and prescription drug costs.
Medigap is also called a Medicare Supplemental plan. It can help pay for some of the out-of-pocket costs that Medicare Parts A and B don’t pay. It is different from Medicare Advantage because it doesn’t offer extra benefits. It only pays for some of the costs that regular Medicare Parts A and B don’t pay. These costs may include copays, deductibles and coinsurance. You don’t need to buy a Medigap plan if you have a Medicare Advantage plan.
Special Needs plan
A Special Needs plan is a type of Medicare Advantage plan. It includes coverage for people with one or more of the following:
a) Chronic conditions:
- Autoimmune disorders
- Cardiovascular (heart) disorders
- Chronic alcohol or other drug dependence
- Chronic heart failure
- Chronic lung disorders
- Chronic mental health conditions
- End-stage liver disease
- End-stage renal (kidney) disease
- Neurologic disorders
- Severe hematologic (blood) disorders
b) People who live in a medical institution like a skilled nursing facility or who need home nursing care.
c) People with both Medicare and Medicaid.
If you qualify for a Special Needs plan you may be able to switch to a different Medicare Advantage plan at any time during the year. If you want to select a primary care physician (PCP) at an OptumCare Medical Group office, you need to follow these steps:
- Choose a Medicare Advantage plan that allows you to pick a medical group or network that has a contract with OptumCare Medical Group. In Southern California, these medical groups include Monarch HealthCare, AppleCare and Primary Care Associates.
- Next, you need to pick a PCP who is in your medical group or network. Maybe you already know who you want for your PCP or which doctor’s office you want to go to. If so, make sure you select the medical group that the office and PCP belong to. Check our locations page to see what network(s) our clinics are in.
See our Medicare FAQs