What Is Original Medicare?

What Is Original Medicare? 

Original Medicare is a federal health insurance program for seniors 65 and older and some younger people with specific disabilities. Original Medicare consists of two primary coverages:

• Part A (Hospital Insurance): Covers inpatient care in hospitals, skilled nursing facilities, nursing homes, and the costs of hospice and home health care. Most people do not have to pay a Part A premium. 
• Part B (Medical Insurance): Part B covers medically necessary services, preventative care, and durable medical equipment. You must pay monthly premiums for Part B coverage, which varies based on income.

Medicare offers affordable and guaranteed health insurance to older Americans who may have trouble paying for conventional insurance policies. Over half of the 65 million Medicare beneficiaries nationwide receive coverage through Original Medicare. 

How Does Original Medicare Work?

Eligible individuals can secure Original Medicare during one of the following enrollment periods:

• Initial Enrollment Period: Your 7-month Initial Enrollment Period (IEP) begins three months before you turn 65 and typically occurs automatically for tax-eligible seniors. For example, someone with a June birthday could enroll anytime between March 1 and September 30. However, coverage would not officially begin until their 65th birthday.
• General Enrollment Period: If you miss your IEP, you can enroll in Medicare during the General Enrollment Period (GEP) between January 1 and March 31. However, postponing coverage until your GEP typically results in late enrollment penalties.
• Special Enrollment Period: Specific life-altering circumstances, such as natural disasters, divorce, and death, often constitute a unique Special Enrollment Period (SEP), allowing beneficiaries to secure coverage outside the traditional Medicare windows.

Eligibility

You can get Original Medicare by meeting any of the following criteria: 

• You are age 65 or older. 
• You are younger than 65 but have received 24 months of SSDI for an eligible disability.
• You have End-Stage Renal Disease (ESRD)
• You have Amyotrophic Lateral Sclerosis (ALS), also known as Lou Gehrig’s disease. ​​

Coverages 

Medicare Part A and Part B each cover a predetermined portion of the following services:

A patient’s share of costs will vary depending on the care they receive and how it gets classified. For example, Part A covers the first 60 days of inpatient hospital care but charges a significant daily copay thereafter. 

Furthermore, medical facilities and doctors must accept Medicare assignment, meaning they have agreed to Medicare’s billing terms and will not charge you more than your precalculated deductible and coinsurance rate. Talk to your doctor or utilize Medicare’s online coverage finder to learn more about your healthcare benefits and affiliated costs. 

What’s Not Covered 

While Original Medicare offers identical benefits for all its members, it will not pay for everything. Beneficiaries typically must pay out-of-pocket or secure supplementary coverage for the following services:

• Prescription drugs
• Routine and preventive dental care
• Vision and hearing care
• Medical care received outside the U.S. 
• Assistive services for activities of daily living (ADLs) like getting dressed, bathing, and eating
• Non-emergency transportation to medical appointments
• Cosmetic surgery and other non-medically necessary procedures
• Home modifications
• 24/7 care at your home
• Meal delivery
• Long-term care in nursing homes or assisted living facilities

Parts of Original Medicare

As noted earlier, Original Medicare consists of Part A and Part B, each combining to cover the majority of healthcare expenses. 

Part A

Part A (Hospital Insurance) covers costs related to:

• Inpatient hospital services ordered by hospital staff following your admission to the facility
• Services received in skilled nursing facilities and other short-term care centers
• In-home medical care or hospice care for terminally ill patients

Part A will cover professional nursing care and health aide services for homebound individuals up to 8 hours a day, 28 hours per week. Any in-home care exceeding these limits will trigger out-of-pocket charges. 

If you or your spouse worked for 10 years and paid the necessary Medicare taxes, you can receive an Original Medicare plan with premium-free Part A coverage.

Part B

Contrarily, Part B (Medical Insurance) covers the following outpatient services:

• Clinical lab services, such as bloodwork or mammograms
• Preventative services like health screenings, shots, and exams
• Outpatient medical procedures and surgeries like cataract removals, tendon or muscle repair, vasectomies, and much more
• Outpatient mental health services like depression screenings and psychologist appointments
• Durable medical equipment like crutches, wheelchairs, or pacemakers

Remember that for Medicare to grant coverage for an eligible service, procedure, medication, or piece of equipment, a Medicare-approved doctor must designate it as medically necessary in diagnosing, treating, or managing a condition, illness, or injury.

What Are the Costs of Original Medicare? 

Medicare Part A and Part B both require some level of patient cost-sharing, as illustrated below:

	Definition	Part A costs	Part B costs
Premium	What you pay every month to maintain coverage	$0, $278, or $506, depending on lifelong Medicare tax contributions	$174.70 in 2024; can cost more for people with higher incomes
Deductible	Out-of-pocket costs due before Medicare begins covering its share of expenses.	$1,632 in 2024	$226 in 2024
Penalties	Monthly fees for late enrollment	10% premium increase, lasting twice the number of years you postponed enrollment	Permanent 10% premium increase for every year you delay enrollment
Copays and coinsurance	A flat amount or relative percentage you pay for an eligible medical service	Generally, a flat fee ranging from $0 to $800	20% of medically necessary services

How to Get Original Medicare

Follow these steps to secure Original Medicare: 

1. Gather relevant documents, such as your Social Security number and current health insurance coverage.
2. Visit the official Medicare website and follow enrollment instructions. You can also enroll by phone or in person. 
3. Review your application to ensure that personal information, coverage choices, and effective dates are accurate.
4. Receive your confirmation letter and Medicare card in the mail.
5. If you wish, apply separately for Medicare Part D or a Medicare Supplement policy. 
6. Review your Medicare coverage annually during the Medicare Open Enrollment Period between October 15 and December 7. 

Alternatives and Supplements to Original Medicare 

While Original Medicare pays for most preventive care and medically necessary treatment, beneficiaries with more specific needs must purchase additional coverages. 

Medicare Advantage (Part C) 

Private companies sell and structure Medicare Advantage policies under federal oversight and must offer identical or greater benefits to both Original Medicare Part A and Part B. Notably, many Medicare Advantage plans even roll in drug coverage and additional services like vision or dental care for little or no extra cost. Some plans even include free gym memberships, non-medical transportation, grocery allowances, and other benefits not covered by Original Medicare. 

Unlike Original Medicare, these plans can vary in price and set independent cost-sharing protocols. While these policies can help healthy seniors who need specific medications and services save money, Medicare Advantage premiums, deductibles, copays, and coinsurance can add up quickly for people who become severely ill. 

Medicare Prescription Drug Plans (Part D) 

Despite its many benefits, Original Medicare does not offer prescription drug coverage. Therefore, Original Medicare members with pharmaceutical needs must enroll in privately funded Part D plans. As of March 2023, 50.3 million Original Medicare members have supplemental Part D coverage. 

All Part D plans include a formulary of covered drugs, each assigned to a different tier correlating to its relative cost. Part D copays can range from a $0 copayment for a generic medication to a 50% or higher coinsurance for a brand-name product. When enrolling in Part A or B, you can simultaneously shop for a Part D drug plan. If you miss this window, you may have to pay a lifelong whenever you finally secure coverage. 

Medigap 

Original Medicare members can purchase Medicare Supplement Insurance – also known as Medigap – plans to help cover gaps in Original Medicare coverage. Though sold by private companies, customers can choose between 10 uniform policy types categorized by letter. For example, Medigap Plan F will pay your entire Part B coinsurance, whereas Plan K would only contribute 50%. 

Notably, several Medigap plans for 80% of emergency care received while traveling abroad. If interested in such coverage, talk to a licensed Medicare agent and thoroughly compare policies. Despite its many benefits, enrolling in Medigap can prove expensive and often difficult to withdraw from or switch coverage.

Putting It Together

While Original Medicare can significantly reduce your health insurance costs after age 65, you must still prepare to cover specific expenses out-of-pocket or purchase supplementary coverage. Carefully consider all the services, medications, and equipment you may require in your retirement years against the cost of applicable Medicare Advantage, Medicare Part D, or Medigap policies.

If your desired coverage level exceeds your budget, research financial assistance programs like Medicare Extra Help, Medicare Savings benefits, or state-sponsored Medicaid.   

Frequently Asked Questions