The Parts of Medicare

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1. What is a Part?

When people talk about the ‘parts’ of Medicare, they are really just talking about the various Medicare programs. Medicare can be divided into four distinct programs, each of which has a different way of helping seniors cover the costs of their medical care. Once you become eligible for Medicare, you’ll need to decide which of these programs to enroll in. This lesson will give you a basic understanding of how these programs work, and what benefits they offer. We will cover Original Medicare, Medicare Part D, Medicare Supplement Insurance Plans, and Medicare Advantage Insurance Plans.

2. Original Medicare

Original Medicare is the only part of Medicare you get directly from the federal government, and it’s the foundation that all the other parts of Medicare are built on. Original Medicare has two parts, which you can see on your Medicare card: Part A and Part B. Each part covers a different set of services.

3. Medicare Part D

With so much left out of Original Medicare, it’s no surprise that we ended up adding a few more parts to the Medicare program over the years. One of the most important additions has been Medicare Part D, which helps beneficiaries pay for their prescription drugs.

You can sign up for Medicare Part D either through a Medicare Advantage plan with prescription drug coverage (MAPD) or a Stand-Alone Medicare Part D Plan (PDP).

Because of heavy regulation from Medicare, all Part D coverage ends up looking pretty similar, and choosing the right plan is straightforward. Before enrolling in a Part D plan, you just need to make sure it has a good star rating, covers all your prescriptions at a reasonable price, and works with a pharmacy that is convenient for you.

You can do this yourself by using the Medicare Plan Finder at Medicare.gov, or get in touch with Medicare Mind to have an independent broker do the work for you.

4. Medicare Supplement Plans (aka Med-Sup, Medigap)

Original Medicare on its own leaves beneficiaries exposed to deductibles and coinsurance. Medicare has provided us with two ways to manage these costs: Medicare Supplement Plans and Medicare Advantage plans. We’ll look at Medicare Supplement plans first.

A Medicare supplement plan works by paying some or all of the portion of the bill that’s left over after Original Medicare has paid its share. There are 10 standard Medicare Supplement plans, labeled A, B, C, D, F, G, K, L, M, N, which are available in most states.

A supplement plan works with Original Medicare and Part D. If you choose Medicare Supplement coverage, you should be enrolled in three different insurance plans: Original Medicare, which is your primary medical insurance, the supplement plan, which is your secondary medical insurance, and a part D plan, which is your prescription drug insurance.

Now that we know how they work, let’s finish off this section by taking a look at some of the advantages and disadvantages of Medicare Supplement Plans:

5. Medicare Advantage Plans (aka Part C, MAPD, MA plans)

Medicare Advantage plans are newer than Medicare Supplement plans, but are now well established and increasingly popular. Medicare Advantage plans bring all your medical coverage together into one plan. Much like a Part D plan, they act as a middleman between the government and the beneficiary. The government pays the plan, and the plan takes over the administration of your benefits, paying your bills and setting your co-payment, coinsurance, and deductible amounts.

Let’s finish by taking a look at the advantages and disadvantage of Medicare Advantage Plans.