About Medicare

Medicare, enacted in 1965, is a Federal government medical plan offered at age 65. However, certain
disabilities may qualify an individual younger than age 65. Known as Original Medicare, there are two
parts, A and B.
Part A primarily covers hospitalization and subsequent skilled nursing and rehabilitation.
Part B primarily covers outpatient care, such as doctors, outpatient surgery, laboratory, testing,
ambulance and more.
For most individuals there is no cost to join Part A if they have made contributions through payroll taxes
(FICA) for at least 10 years. Part B does have a monthly premium cost which is determined by household
taxable income.
In 1997, Part C was introduced. Part C is also known as Medicare Advantage and allows private
insurance companies to manage Medicare through HMOs and other provider organizations. There are
many, many plans offered under Part C, and all are a bit different in plan design.
Part D came along in 2003 to allow Prescription Drug Plans, also offered through private insurance
companies with many different plans available.
All these Medicare plans have oversight by the Centers for Medicare & Medicaid Services (CMS), a
division of the Department of Health and Human Services. All plans must have core elements required
by CMS, but no plans cover all medical costs. There are co-payments, deductibles, monthly premiums,
limitations, and exclusions.
There are also penalties imposed by the government if there is an uninsured delay in signing up for
Medicare, so be sure to join as soon as you become eligible.