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Home » Medicare Part A & B Eligibility, Coverage, Requirements 2023

Medicare Part A & B Eligibility, Coverage, Requirements 2023

More people are entering Medicare in 2023 than in any previous year. Whether you’re one of these Americans, or you've been in Medicare for years, its important to stay on top of all the changes to the system. Read this guide to get up to date on Medicare Part A & B eligibility, coverage, requirements 2023, and learn how to make a smart plan for your coverage.

Medicare Part A & B Eligibility

In some ways, Medicare Part A and B have the same eligibility rules. For instance, they both require that you be a citizen of the United States (whether natural-born, or naturalized) or a permanent legal resident who has lived in the U.S. lawfully for at least five years. These eligibility rules determine who will one day enter the program. Besides this, though, there are specific rules that govern when you actually enter the program and start receiving coverage.

There are a total of five triggers for entry into Medicare Part A and B:

  • Ageing-in (turning 65 years old)
  • Losing your employer coverage (if you kept working and delayed taking Part B past age 65)
  • Diagnosis of Lou Gehrig’s Disease (ALS)
  • Diagnosis of End Stage Renal Disease (ESRD)
  • Receiving disability payments from Social Security or the Railroad Retirement Board for 24 straight months

You won’t actually get into the program until you meet one of these milestones. Most people enter at age 65 or later, if they continue to work past age 65. These are the generic eligibility requirements that apply to both Part A and B.

Specific Requirements For Part A

Beyond the general eligibility rules, most people want to know if they will qualify for premium-free Part A coverage. This means receiving hospital benefits under Medicare Part A without having to pay a monthly premium.

The good news is that most people do in fact qualify to receive Part A at no monthly cost. This is because of their work history. Part A is funded through payroll taxes, so if you work full-time for at least ten years (the same general rule to be eligible for Social Security), you’ll be able to take Part A on a premium-free basis.

If you don’t have enough work history, you may still qualify for premium-free coverage if you are or were married to someone who did. You can claim premium-free Part A from your spouse even if they have passed away or if you are divorced. There are some specific rules related to this, but generally you’ll get premium-free Part A through your spouse as long as you were married for at least one year and you haven’t re-married (if you’re divorced from the spouse you’re trying to qualify through).

If you don’t qualify for premium-free coverage through a spouse either, you can elect to sign up anyway and pay for your coverage. If you do this, you’ll have to pay a monthly premium that is dependent on your work history:

  • $499 per month, or
  • month

One of the more subtle Medicare Part A requirements is that if you elect to pay for it, you must also sign up for Part B. If you get Part A premium-free you have the right, but not the requirement, to also enroll in Part B.

There are other requirements for Medicare Part A in terms of out of pocket costs. When you actually put your Medicare benefits to use, like when you’re hospitalized, you’ll have certain costs to pay. The first cost is the Part A deductible. For 2023, this amount is $1,556.  You’ll pay this amount up-front if you need Part A services. Once you’ve paid this amount, Medicare will cover the costs of your institutional care for a period of time:

  • Up to 60 days in the hospital
  • Up to 20 days in a skilled nursing facility

You don’t pay any other Part A costs during these stays; Medicare covers the tab. If your stay is longer than this, you’ll have to start paying daily co-payments:

  • $389 per day for hospital stays between 61 and 90 days
  • ay for skilled nursing stays between 21 and 100 days

For skilled nursing home stays longer than 100 days, you’ll pay the full cash price. Hospital stays longer than 90 days will cost you $778 pe r day for as long as you have Lifetime Reserve Days. Every person who’s eligible for Medicare starts their coverage with 60 of these reserve days. You only use them when you have a hospital stay that’s longer than 90 days, so they’re very rarely used. If you do happen to have a hospital stay that uses up all of your Lifetime Reserve Days, then you’ll be responsible for paying the full cash price for the rest of your hospital stay.

Specific Requirements For Medicare Part B

Part B is simpler than Part A. You don’t pay for it during your working years. Instead, you pay a monthly premium when you actually enroll, so it’s like “normal” health insurance. For 2023, the standard monthly premium is $170.10.  The amount you actually pay, though, will vary based on income level.

Your entry into Medicare Part B may be automatic in some cases. If you’re already receiving Social Security when you turn 65, your enrollment will be automatic. If you’ve delayed taking Social Security, and many people do that these days since Social Security Full Retirement Age is 66 plus, then you’ll have to manually enroll in Part B.

If you’re still working and covered by your employer’s health insurance you can delay taking your Part B coverage as long as your employer has at least 20 employees. The same is true if you’re covered by your spouse’s employer plan. In these cases you can delay taking Part B for as long as you continue to be covered by the employer plan. When you or your spouse retire and lose coverage, you’ll receive an eight month enrollment window to sign up for Part B.

If for some reason you don’t enroll in Part B on-time, you could be subject to late enrollment penalties. They impose these penalties to discourage you from waiting to enroll until you’re sick. For every full 12 months that your enrollment is late, you’ll have to pay a 10% late enrollment penalty. The penalty is based on the standard Part B premium. Importantly, this penalty is permanent; you’ll pay it every month for as long as you have Part B coverage.

Your actual entry into Medicare will be delayed if you enroll late, too. If you miss your enrollment deadline, you won’t be able to enroll until the General Enrollment Period (GEP), which runs from January 1st to March 31st each year. If you enroll during GEP, you won’t actually enter until July 1st, so you’ll have quite a gap in coverage. To avoid the penalties and delayed enrollment, make sure to enroll in Part B on-time.

Costs For Using Part B Services

Just like for Part A, you’ll also have out of pocket costs when you actually use your Part B benefits. When you use your Part B benefits, you’ll pay these costs:

  • Part B deductible, which is $233 for 2023
  • Part B co-insurance, which is 20% of the cost for your services
  • Part B excess charges, which are fairly rare, but can be as much as 15% of the cost for your services

Once you pay the Part B deductible, Medicare will begin paying 80% of the cost for your Part B services and procedures. You’re responsible for the remaining 20% of the cost.

Medicare Part A & B Coverage

Now that we’ve looked at the eligibility and cost structure of the program, we can examine what the coverage is like. In other words, what kinds of procedures and services will be covered when you’re on Medicare?

Medicare Part A Coverage

Part A is the hospital insurance portion of Medicare, so you’ll use this coverage when you’re in an institutional setting, but also in a few others. Medicare Part A covers all of these types of care:

  • Hospitalization
  • Skilled nursing care
  • Home health care
  • Hospice care
  • Skilled nursing care in a nursing home

Part A will cover the costs of your stay in a hospital or skilled nursing facility. While you’re in these settings, you might receive services or have procedures performed that are covered by Part B; both aspects of Medicare work together in these cases.

Medicare Part B Coverage

You’ll use Part B more frequently than Part A. Part B provides the medical insurance aspect of Medicare; you’ll use this coverage for your more regular, run-of-the-mill health care needs. Part B covers:

  • Doctor’s, specialists, and therapist office visits
  • Lab work and diagnostic imaging
  • Durable medical equipment
  • Outpatient surgeries
  • Some cancer treatments
  • Mental health treatment
  • Emergency medical transportation

Although Part B tends to be less emergency oriented, it does cover many chemotherapy treatments for cancer, which is obviously a major illness.

What Medicare Doesn’t Cover

While Part A and B together provide very comprehensive coverage, there are several things that are not covered at all that you need to be aware of. Neither Part A nor B provide coverage of:

  • Routine prescription drugs
  • Emergency coverage outside the United States
  • Procedures that are primarily cosmetic
  • Fertility treatments
  • Treatments to address hair loss
  • Routine dental
  • Routine vision
  • Hearing loss

You can see that some of these services are very necessary to your health, like prescription drug coverage, but not available from Original Medicare. It is because of these gaps in coverage, as well as the out of pocket spending you’re exposed to under Medicare, that private insurance companies offer insurance coverages that complement and enhance Medicare.

Medicare Requirements For Private Plans In 2023

There are three main kinds of private Medicare Insurance coverage:

In general, you can combine a standalone Part D drug plan with Medicare Supplement Insurance. If you go with a Medicare Advantage plan, you’re mostly likely going to get your drug coverage from that plan.

Medicare Part C Requirements For 2023

Part C is the Medicare Advantage program. These plans offer the opportunity to get your Part A and B benefits from a private insurance company. These plans are more compelling than that, though, because they usually offer coverages you can’t get with Original Medicare. For instance, you can receive Part D prescription drug coverage from a Medicare Advantage plan.

Also, every Medicare Advantage plan available has an Out of Pocket Maximum (OOPM) amount. This amount is the most you’ll pay in any one year on medical treatment. Original Medicare doesn’t come with this protection; under Original Medicare your costs are potentially unlimited in any given year.

In addition to this important protection, Medicare Advantage plans often provide coverage for:

  • Routine dental services and procedures
  • Routine vision coverage
  • Hearing coverage
  • Fitness and gym memberships
  • Transportation

In order to enroll in a Medicare Advantage plan, you must have Part B coverage. Once you’re enrolled in your Medicare Advantage plan, you’re required to continue paying your Part B premium.

Medicare Supplement Insurance Requirements For 2023

Medicare Supplement Insurance is your other major option for help with the out of pocket costs of Medicare. Unlike Medicare Advantage, Medicare Supplement Insurance is designed to work with Original Medicare. Supplement Insurance, which is very often called Medigap, is a secondary coverage that pays benefits after Original Medicare pays.

The amount that your plan covers is determined by which specific Medigap plan you choose; there are ten standardized plans available. Each one of the covers a different mix of the gaps and costs of Original Medicare.

Regardless of which standardized plan you choose, you’re required to be actively enrolled in Parts A and B of Original Medicare. You will also have to enroll in a standalone prescription drug plan (a Part D drug plan that is not a Medicare Advantage plan).

Medicare Part D Requirements For 2023

Part D of Medicare provides two different types of prescription drug plans:

  • Medicare Advantage Prescription Drug Plans (MAPD)
  • Standalone Prescription Drug Plans (PDP)

Both types of plan work the same way in terms of the coverage. Every standalone Part D drug plan can include these costs:

  • Monthly premium
  • Annual deductible
  • Per-prescription co-payments and co-insurance

While every standalone drug plan has a monthly premium, there are some plans that don’t have an annual deductible. For those that do, the maximum deductible permitted for 2023 is $480 .

To be eligible for a standalone drug plan, you must be either currently enrolled in Part B, or entitled to Part A.

Use All Of Your Options To Minimize Your Costs

In this guide, we’ve looked at Medicare Part A & B Eligibility, Coverage, Requirements 2023. The important thing to do is understand what your costs are likely to be under Original Medicare and then choose the private plan that will best protect you from high out of pocket costs. Once you’ve done that, monitor the yearly changes to Medicare and make any adjustments to your coverage as needed.

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