Original Medicare
Made up of Medicare Part A and Part B
Learn more about what makes up "Original Medicare".
Summary
- Original Medicare is made up of two parts: Medicare Part A and Medicare Part B.
- Together, Part A and Part B cover medical and hospital insurance for individuals 65 years of age and older.
- Can see any doctor in the country who accepts Medicare.
- There is a seven-month period when you turn 65 called your Initial Enrollment Period (IEP) to enroll in Original Medicare–the month of your birthday plus 3 months before your birthday and 3 months after your birthday. If you miss this IEP, you’ll need to wait for the annual General Enrollment Period.
Medicare Basics
In 2021, more than 26 million people were enrolled in a Medicare Advantage plan.1 If you or a friend or family member will soon be eligible for Medicare, you may have questions. We are here to help answer them.
Who is Medicare for and how is it funded?
Medicare is a public health insurance for U.S. citizens who:
- are 65 years of age or older; or
- are under 65 years of age but have qualifying disabilities
The Medicare Program is run by The Centers for Medicare and Medicaid Services (CMS). The program is funded through 2 trust fund accounts:
Hospital Insurance (HI) Trust Fund:
Funded through income taxes paid to Social Security, premiums paid to Medicare Part A (by those not eligible for premium-free Part A) and interest earned.
Supplementary Medical Insurance (SMI) Trust Fund:
Funded through Federal budget set aside by Congress, premiums paid to Medicare Part B (Medical Insurance) and Medicare Drug Coverage (Part D) and interest earned.
What is the Original Medicare?
You may be wondering what is covered by “Original Medical”. It is made up of Medicare Part A and Medicare Part B, which covers most standard medical services. Part A and Part B cover facility costs and Medicare-approved services you receive inside. You may hear Part A called “hospital insurance,” and Part B called “medical insurance.”
Part A “Hospital Insurance"
- Inpatient care in a hospital
- Skilled nursing facility care
- Nursing home care
- Hospice care
- Home health care
Part B “Medical Insurance”
- Clinical research
- Ambulance services
- Durable medical equipment (DME)
- Mental health
- Inpatient
- Outpatient
- Partial Hospitalization
- Limited outpatient prescription drugs
| Part A | Part B |
|---|---|
| "Hospital Insurance" | "Medical Insurance" |
| Inpatient Care | Outpatient Care |
| Skilled Nursing Facility Care | Doctors + Other Care Providers |
| Hospice Care | Medical Equipment |
| Home Health Care | Home Health Care |
| Preventative + Screening Services |
For a more in depth look into what you can expect from your Medicare policy, check out our information on Original Medicare Part A and Medicare Part B coverage.
How much does Medicare cost?
Generally speaking, you can anticipate paying a monthly premium for Medicare coverage and part of the costs each time you receive a covered service.
Medicare Part A costs for 2022
Deductible: $1,556
Premium: $0 (for most people)
Note:
- Most individuals don’t have a Part A premium, but some may be responsible for paying a Part A premium. This will vary based on employment and tax history.
- You’ll be responsible for your Part A deductible.
Medicare Part B costs for 2022
Deductible: $233
Premium: $170.10 (or higher depending on your income)
Note:
- Medicare Part B has a standard yearly deductible cost.
- Medicare Part B has a standard monthly premium cost.
For both Part A and Part B, after you meet your deductible, your cost for care will be approximately 20%, and Medicare will pay about 80% for the remainder of your benefit calendar year.
There are many other factors to consider when planning for Medicare such as co-payments, co-insurance and enrollment deadlines.
How Do I Enroll in Original Medicare?
If you are already getting benefits form Social Security or the Railroad Retirement Board (RRB), in most cases you'll automatically get Part A and Part B starting on the first day of the month you turn 65. You can enroll online if you actively sign up for both Parts A and B at the same time. Because you pay a premium for Part B coverage, you can turn down the coverage. If you turn down Part B coverage but choose to enroll later, you may have to pay a higher monthly premium.
You can enroll online if you actively sign up for both Parts A and B at the same time.
Will I need other coverage?
It is important to understand that most people will need to add Medicare Prescription Drug Plan (Part D) coverage:
- Part D is an optional Medicare benefit. It’s recommended if you think you’ll need prescription medication in the future or currently depend on prescriptions to manage your health.
- Private health insurance companies administer Part D. The federal government sets specific requirements, but private health insurance companies decide which drugs to cover.
To join Medicare Part D, you can choose a Prescription Drug Plan (PDP) or a Medicare Advantage plan that includes drug coverage (MA-PD). You can add Part D coverage during any of the Medicare enrollment periods.
When Am I Eligible to Enroll in Medicare?
The majority of Americans who choose Medicare health insurance plans are 65 years of age or older. You have the option to sign up for just Medicare Part A, or both Medicare Part A and Medicare Part B. Once you are ready, there are 3 times you can sign up for Medicare:
- Initial Enrollment Period - this is a 7-month period that begins 3 months prior to the month you turn 65, the month you turn 65, and the 3 months after you turn 65.
- For example, if you turn 65 in July:
Three months before your birth month: April, May, June
Your birth month: July
Three months after your birth month: August, September, October- Medicare Part A is free for most people. Depending on your employment and tax history, you may need to pay for Part A.
- In most cases, if you do not sign up for Part B when you are first eligible, you will need to pay a late enrollment penalty and could have a gap in your health coverage
- For example, if you turn 65 in July:
- Special Enrollment Period - once the initial enrollment period ends, you may have a chance to sign up for Part A (if you need to purchase it) and Part B during this special enrollment time, but only if you meet certain requirements.
- If you're covered under a group health plan based on current employment
- You have a Special Enrollment Period to sign up for Part A and/or B at any time as long as you are working
- You're covered by a group health plan through the employer or union that you work for
- Note: this special enrollment period does not apply if you have End-Stage Renal Disease (ESRD) or Veterans Affairs and Individual Health Insurance Marketplace coverage.
- General Enrollment Period - if you miss the initial enrollment period and do not qualify for the special enrollment period, you may have to wait until the Medicare General Enrollment Period (January - March 31), with coverage starting July 1 of that year. In most cases you will have to pay a late enrollment penalty if your enroll during this period.
For some people with specific disabilities and illnesses, Medicare is available before they reach 65 years of age. These individuals must:
- have received Social Security Disability benefits for 24 months or
- have End Stage Renal Disease (ESRD) or
- Amyotrophic Lateral Sclerosis (ALS, also known as Lou Gehrig's disease)
Is Medicare the Right Choice for You?
Original Medicare is one way to get Medicare. Another option is Medicare Advantage. In order to determine which is right for you, we recommend you also take time to learn about Medicare Advantage, Medigap, and Out-of-pocket costs. These are all important pieces in making the best decision for your care. We are here to answer any questions, if you'd prefer to speak to a licensed professional for advice, please feel free to contact us today.
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