Medicare: Part A, Part B and the Supplement

These are the basics of Medicare, available to all people over the age of 65 and those that have special circumstances (such as a permanent disability).

Part A: This portion encompasses your hospital care as well as skilled nursing facility and hospice care–and in some cases, home health care.


Part B: This portion covers your doctor visits, tests, exams, therapies and more. This is your area of greatest use.


*Under the income level of $85K for an individual and $170K for a couple.

This basic set-up dictates that the government will pay 80% of all medicare approved services.

It is then up to you to pay the other 20%. This is traditionally done in one of two ways:

  1. By way of a traditional Medicare supplement, or
  2. By way of a Medicare Advantage plan

The traditional Medicare supplement has several distinguishing features:

  1. It is a true insurance product.
  2. All services must be “Medicare approved”
  3. The program eliminates the need for networks. If the doctor/facility accepts Medicare, then the bill is paid.
  4. Because it is a true insurance product, you can expect annual rate increases.
  5. There is no medical underwriting during your initial election period.
  6. Rx is not included, requiring a stand-alone Rx plan.

The Medicare Advantage plan is an arrangement where your care is provided through a private carrier, using their network resources.

  1. You may be offered additional services outside of the traditional “Medicare approved” schedule.
  2. You will use the network of your private-based carrier.
  3. You will have generally a lower, more stable premium.
  4. You will pay for services as you advance through your regular care as well as special tests and procedures.
  5. Rx is included as part of your plan, unless you choose otherwise.

Below is a basic guide to the Part A/Part B/Supplement breakdown:

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