What is Medicare’s Role in Funding for Long-term Care Costs?
Medicare age eligibility for our elderly clients is 65. The traditional fee for service system consists of two parts, Part A and Part B and enrollment is fairly automatic.
Medicare Part A is available to every eligible individual, free for those with 40 quarters of covered employment, and can be purchased by all elders over 65 who do not meet the 40 quarter test.
Medicare Part A generally covers:
Medicare Part B is available to individuals entitled to Part A. The individual pays part B usually as a monthly deduction from his social security check. In 2001, the monthly deduction was $47. Almost all individuals 65 and older are advised to stay in this program, unless better coverage is included in a company health plan or a company health retirement benefit.
Medicare Part B medical insurance generally covers:
An optional Medigap policy (also known as supplemental insurance) is set up to pay Medicare’s co-payments and deductibles. The cost of the policy ($1,500 - $4,000) varies by age, territory and extent of coverage.
Medigap policies are now standardized in all states for ease of comparison. Some Medigap policies include additional features at a higher premium such as foreign travel emergencies and a basic drug reimbursement.
Other than nonpayment, a Medigap policy cannot be cancelled so the elder is advised to set up some way to have the premium automatically paid.
Neither Medicare Part A nor Part B pays for prescription drugs, eyeglasses, dentistry, or most mental health services. The costs of home care, nursing home or assisted living, (nonskilled custodial care), and other long-term costs are not covered by either Medicare or Medigap.
HMO Medicare may be a good choice for elders on a fixed budget who cannot afford to pay a large premium for a Medigap policy. Most Medicare HMO’s cover the cost of prescription drugs less a moderate co-payment ($5 - $15). The HMO covers part A and B deductibles.
The major disadvantage to elders who switch from straight Medicare is the freedom of choice. The HMO requires approval and authorization of most non-emergency services before they are provided therefore getting services can sometimes take longer if available at all. All specialists must be seen only after their primary care doctor assesses the need for the visit and the choice of doctors is limited to the practitioners presently enrolled as providers in HMO.
In addition, due to the high cost of providing care to the elderly, many HMO’s have stopped providing services to many Medicare and Medicaid clients in states with large elder populations such as Florida and Texas. When elders are dropped from an HMO, their Medicare benefits are reinstated but many are left without the ability to purchase a Medigap policy due to their age and medical condition.
Neither Medicare Parts A or B nor HMO Medicare pay for any long-term care such as nursing homes or custodial home care. Thus Medicare is not a suitable source of funding for the elders long-term costs.
Medicare age eligibility for our elderly clients is 65. The traditional fee for service system consists of two parts, Part A and Part B and enrollment is fairly automatic.
Medicare Part A is available to every eligible individual, free for those with 40 quarters of covered employment, and can be purchased by all elders over 65 who do not meet the 40 quarter test.
Medicare Part A generally covers:
- Medical care costs of a hospital up to a maximum of 90 days, with only the first 60 days
- fully covered after a deductible of $776, plus 60 lifetime reserve days.
- Up to 100 days at a skilled nursing facility following a hospital stay (the first 20 days fully
- covered, the 21 through 100th day have coinsurance of $101.50)
- Up to 100 home visits by a skilled nurse, speech, occupational, or physical therapists following a hospital stay if the patient is confined to home
- Hospice care to terminally ill patients
- Blood during a covered hospital stay
Medicare Part B is available to individuals entitled to Part A. The individual pays part B usually as a monthly deduction from his social security check. In 2001, the monthly deduction was $47. Almost all individuals 65 and older are advised to stay in this program, unless better coverage is included in a company health plan or a company health retirement benefit.
Medicare Part B medical insurance generally covers:
- Certain physician services including surgery (subject to a list of Medicare approved charges)
- Clinical laboratory services
- Certain medical equipment and vaccines
An optional Medigap policy (also known as supplemental insurance) is set up to pay Medicare’s co-payments and deductibles. The cost of the policy ($1,500 - $4,000) varies by age, territory and extent of coverage.
Medigap policies are now standardized in all states for ease of comparison. Some Medigap policies include additional features at a higher premium such as foreign travel emergencies and a basic drug reimbursement.
Other than nonpayment, a Medigap policy cannot be cancelled so the elder is advised to set up some way to have the premium automatically paid.
Neither Medicare Part A nor Part B pays for prescription drugs, eyeglasses, dentistry, or most mental health services. The costs of home care, nursing home or assisted living, (nonskilled custodial care), and other long-term costs are not covered by either Medicare or Medigap.
HMO Medicare may be a good choice for elders on a fixed budget who cannot afford to pay a large premium for a Medigap policy. Most Medicare HMO’s cover the cost of prescription drugs less a moderate co-payment ($5 - $15). The HMO covers part A and B deductibles.
The major disadvantage to elders who switch from straight Medicare is the freedom of choice. The HMO requires approval and authorization of most non-emergency services before they are provided therefore getting services can sometimes take longer if available at all. All specialists must be seen only after their primary care doctor assesses the need for the visit and the choice of doctors is limited to the practitioners presently enrolled as providers in HMO.
In addition, due to the high cost of providing care to the elderly, many HMO’s have stopped providing services to many Medicare and Medicaid clients in states with large elder populations such as Florida and Texas. When elders are dropped from an HMO, their Medicare benefits are reinstated but many are left without the ability to purchase a Medigap policy due to their age and medical condition.
Neither Medicare Parts A or B nor HMO Medicare pay for any long-term care such as nursing homes or custodial home care. Thus Medicare is not a suitable source of funding for the elders long-term costs.
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