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	Home > Grantee Info > Publications & Products > Minnesota Consumer Awareness Education and Resource Guide for 1998 > Chapter I: Overview of Medicare

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Publications & Products Select a Publication or Product -AAA Training Manual for S.O.R.T. -Minnesota Consumer Awareness    Education and Resource    Guide for 1998 -Project Developed Forms and    Related Documents Minnesota Consumer Awareness Education and Resource Guide for 1998 Table of Contents Next Chapter > CHAPTER I: Overview of Medicare What Is Medicare? Medicare is a federal health insurance program for people over 65 or older and certain disabled people; including those of any age with permanent kidney failure. Medicare is funded with federal government money generated from payroll tax contributions and general tax revenues. Medicare has been around since the mid 1960s as one of the "Great Society" programs. It was added to the Social Security Act in 1965. It is unique in that it provides coverage without regard to medical condition and at the same price for everyone based on uniform eligibility requirements. What Does Medicare Provide? Medicare provides coverage for medical services and supplies needed to diagnose and treat an illness or injury. How Is Medicare Administered? Medicare is administered by the Centers for Medicare and Medicaid Services (formerly the Health Care Financing Administration) [CMS]. CMSs mission is to control health care costs associated with the programs assigned to it. The agency tries to standardize payments for similar types of services and eliminate waste and costs that are excessive or unnecessary. What significance do the numbers/letters/dates have on MC card? They list which coverage the client has and effective date(s) of the coverage. Who is eligible for Medicare? US citizens and legal resident aliens age 65 + are entitled to premium free Part A benefits if they have 40 quarters of SS work credits; most persons with permanent kidney failure and those who have been entitled to disability benefits for >24 months; anyone eligible for Part A is eligible for Part B; there is a monthly premium for Part B. Medicare Part A: What does Part A cover? It covers medically necessary inpatient care in a general hospital, a psychiatric hospital, a skilled nursing facility, and/or medically necessary hospice or home health care. Medicare Part A: What services are covered during a hospital stay? Semiprivate room [two or more beds], meals, general medical and surgical nursing care, special unit nursing care [ICU, CCU etc.], rehabilitation services [PT, OT, ST], prescription drugs, medical supplies, lab tests, x-rays and radiotherapy, blood transfusions [except for the first 3 pints], operating and recovery room charges, other medically necessary services and supplies. A physician must prescribe the care. Medicare Part A: What other services are covered by Part A? Skilled Nursing Facility [SNF] Home Health Care Hospice - each have guidelines that must be followed for reimbursement. Medicare Part A: What services are not covered? Personal convenience items, first 3 pints of blood, private duty nursing, private rooms [unless medically necessary] and take home drugs and supplies. Medicare Part B: What does having Part B coverage mean? It does not matter where you receive the services---at home, in a hospital, in a doctor's office, or in some other medical facility. All costs are subject to the same deductible and same coinsurance payments in any calendar year. The benefit period is for one year. Medicare Part B: What services are covered by Part B? Outpatient hospital services, doctor bills, x-rays and lab tests, ambulance transportation, breast prostheses after a mastectomy, physical therapy, occupational therapy, speech therapy, home health care (if you do not have Part A), blood transfusion (except for the first 3 pints), mammograms and Pap tests, outpatient mental health services, artificial limbs and eyes, arm/leg/neck braces, durable medical equipment, kidney dialysis and kidney transplants, heart/liver transplants under limited circumstances, medical supplies, some oral anti-cancer drugs and certain drugs for hospice patients, immunizations (flu, pneumonia, Hep B), mammography screening yearly, Pap smear with breast and pelvic exam/yearly. Medicare Part B: What limited services are covered by Part B? Podiatry, dental surgery, chiropractor services, optometrist services, immunizations. Medicare Part B: What services are partially covered by Part B? Some diagnostic testing (portable x-ray), lab tests done in clinic that is not CLA facility. Medicare Part B: What services are not covered by Part B? Routine physical exam, routine foot care, hearing aids, eye glasses (exception: cataract surgery), routine eye exams or refraction, dental care, acupuncture, cosmetic surgery, experimental medical procedures, custodial care (except during hospice care), most outpatient prescription drugs, non-prescription medicines, as well as the deductibles and copayments. What are the payment systems for Medicare? Fee-for-service is the method of billing for health services that allows a physician or other practitioner to charge each time a patient is seen or a service is rendered. Capitation/managed care is the way a health plan pays a physician for health services provided to a patient where the physician agrees to accept a certain amount each month for patient care instead of being paid for each time a medical service is received; the "DRGs" (diagnostic related categories) are used to determine the amount that Medicare reimburses hospitals for in-patient services [known as the Prospective Payment System]. How are the risks shared in each system? Capitation/managed care reimbursement shifts the risk to the provider. Fee for service reimbursement shifts the risk to the entity paying the fees. What and who are the "intermediaries and carriers" for Medicare? Medicare payment/claim processing is handled by private insurance organizations under contract to the Federal government/CMS. The fiscal intermediary pays claims for Part A. They deal directly with facilities. Part B claims are handled by the carrier who contracts with CMS. What are the gaps in Medicare coverage? Among the items not paid by Medicare are deductibles and coinsurance amounts, charges in excess of Medicare's approved amounts, additional days of care in a hospital or skilled nursing facility beyond Medicare's maximums, and prescription drugs. What is Medigap/Supplemental insurance? It is private health insurance designated specifically to supplement Medicare's benefits. It fills in some of the gaps in Medicare's Part A and Part B coverage. A Medigap policy pays for items such as deductibles, copayments, prescription drugs, and additional inpatient hospital days. Is it legal to have more than one Medigap insurance policy? No, it is illegal for an insurance company to sell you more than one policy. If you have two policies, you will be paying for duplicate coverage, not better coverage. If you are in a Medicare HMO, do you need a Medigap policy? No, this would be a duplication of coverage since Medigap policies are designed for fee-for-service plans. Table of Contents Next Chapter > Select a Publication or Product -AAA Training Manual for S.O.R.T. -Minnesota Consumer Awareness    Education and Resource    Guide for 1998 -Project Developed Forms and    Related Documents

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