What Medicare Covers

This article explores what Medicare covers, with a special note about long-term care and assisted living.

Over the years since Medicare was started, it has grown and evolved so many times, that occasionally, it is smart to review what it covers, as well as what it does not cover.

Medicare—Part by Part

Medicare comes in four parts—Parts A, B, C and D.

Part A: Hospitalization

When you have Part A and are hospitalized, the hospital will bill Medicare Part A to cover your stay and medically necessary procedures. Additionally, Part A covers skilled nursing facility care (but not long-term care), hospice, and home health services. Though there are some exceptions, Part A does not have a monthly premium.

Part B: Medically Necessary and Preventive Services

This includes services or supplies needed to diagnose or treat a medical condition (such as Alzheimer’s or other dementia), and health care to prevent illness (like the flu shot or mammogram), or to detect it at an early stage. As long as you get these services from a provider who accepts Medicare assignment, your Part B will cover the claim. Examples of what Part B covers are: ambulance services, durable medical equipment (DME), mental health services, partial hospitalization, obtaining a second opinion before surgery, and limited outpatient prescription drug costs. There is a monthly premium for Part B. The standard monthly premium for Part B in 2021 is $148.60. For individual and couples with a higher modified adjusted gross income (above $85,000 and $170,000 respectively), the monthly premium is adjusted to include an income related monthly adjustment amount.

Part C: Medicare Advantage Plans

Part C plans are all-inclusive plans that generally combine together what Parts A, B and D provide separately. Not all Part C plans are accepted by all providers, so before enrolling in one, be sure you know which providers are in the network. However, they sometimes include additional benefits (such as Alzheimer’s or other dementia-related coverage) that are not included in the other separate parts, though at an additional cost. Medicare Part C premiums vary according to plan.

Part D: Prescription Drugs

Part D is a good option if you do not have prescription benefits through a commercial insurance. If you need drug coverage, information on each Part D drug plan can be found at https://www.medicare.gov/drug-coverage-part-d. You can submit your enrollment online as well. You must first be enrolled in Part A or B in order to enroll in Part D. Premiums for Part D plans vary. Not all plans have Alzheimer’s-related drugs on their formulary, so be sure to research the plan formulary thoroughly before enrolling.

Don’t Forget the Supplement

It is important to understand that Medicare does not cover 100% of any medical claim. In general, when you see your physician, or are in the hospital, there will be 20% of the bill that is not covered by Medicare. That is why Medicare supplements are important plans to have. Without a supplement or other commercial insurance, you will be billed for the remaining 20% after Medicare. With Medicare and a supplement, (also known as a “Medigap”), you will have more thorough coverage, and less out of pocket expenses, than with Medicare only. If you happen to have a commercial plan through a current or former employer, there is generally no need to enroll in a supplement.

Supplemental plans range in price, as the level of coverage varies. To find a supplemental plan in your area, go to https://www.medicare.gov/supplements-other-insurance.

A Note about Long-Term Care and Assisted Living

As stated above, Medicare does have a benefit for skilled nursing facility (SNF) care. The benefit is limited to SNF care following a hospitalization and requires the care be for a skilled service such as nursing, physical therapy, occupational therapy and/or speech therapy. When someone with Medicare falls and breaks a hip and needs surgery, they often go to a SNF following the hospitalization to receive some or all of the skilled services listed above. This is a Medicare covered service. The first 20 days are covered by Medicare at 100%, and then days 21-100 are covered minus a daily co-payment, which is another reason to have a supplement.

What is not covered by Medicare is assisted living and long-term care nursing. This includes when someone with Alzheimer’s or other dementia has reached the point of needing to move to an assisted living apartment, or is even further along and needs to live in a secure Alzheimer’s facility. These services are considered custodial, which is not covered by Medicare.

Medicare and You – The Handbook

Each year, Medicare publishes a handbook “Medicare and You” that explains in great detail the facts of Medicare. You can download it for free to an e-reader, or get it via mail. Find it at https://www.medicare.gov/medicare-and-you