Understanding Medicare's 'Original' Plan: What it Covers and How it Works

For many people approaching or already in retirement, Medicare is a vital part of their healthcare. It can also seem like a maze of parts and plans. Let's simplify by focusing on Original Medicare, the traditional program that forms the basis for all other Medicare options.

What is Original Medicare?

Original Medicare is the federal health insurance program for people aged 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS). It's made up of two main parts:

• Part A (Hospital Insurance): This helps cover inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care. Most people don't pay a monthly premium for Part A if they or their spouse paid Medicare taxes through employment for a certain number of years.
• Part B (Medical Insurance): This helps cover doctor's services, outpatient care, durable medical equipment, and some preventive services. Most people pay a monthly premium for Part B, which is usually deducted from their Social Security benefits.

Together, Part A and Part B form Original Medicare. It's managed directly by the federal government.

How Original Medicare Works

When you have Original Medicare, you can typically see any doctor, hospital, or provider in the U.S. that accepts Medicare. You don't need a referral to see a specialist, which offers flexibility. However, it's important to know that Original Medicare doesn't cover everything.

For most services, after you meet a deductible, Medicare pays a portion of the approved amount, and you pay the rest. For example:

• Part A: After your deductible, Medicare pays 100% for the first 60 days of an inpatient hospital stay in each benefit period. There are coinsurance costs for longer stays.
• Part B: After your deductible, Medicare generally pays 80% of the Medicare-approved amount for most doctor's services and outpatient care. You are responsible for the remaining 20% coinsurance.

There's no annual limit on what you might pay out-of-pocket with Original Medicare. This is a key difference from some other insurance plans.

What Original Medicare Doesn't Cover (and what to do about it)

While comprehensive for many medical needs, Original Medicare does not cover certain services. These commonly include:

• Routine dental care (like cleanings, fillings, dentures)
• Routine vision care (like eye exams for glasses, eyeglasses, contact lenses)
• Routine hearing care (like hearing exams, hearing aids)
• Most prescription drugs (this is covered by Medicare Part D, a separate plan)
• Long-term care (like assisted living or nursing home care for daily activities)
• Travel outside the U.S. (except in very limited circumstances)

Many people choose to add other types of coverage to Original Medicare to help fill these gaps or cover out-of-pocket costs. These options typically include:

• Medicare Supplement Insurance (Medigap): These private plans help pay some of the out-of-pocket costs Original Medicare doesn't cover, like deductibles, copayments, and coinsurance. You pay a separate monthly premium for a Medigap policy.
• Medicare Part D (Prescription Drug Coverage): These private plans help cover the cost of prescription drugs. You choose a plan and pay a separate monthly premium.

Understanding Original Medicare is the cornerstone of making informed decisions about your healthcare coverage. It provides a solid foundation, and from there, you can explore additional options that best fit your individual health and financial needs.