A: In the initial phase of Part D coverage, you pay roughly 25 percent of the plan's cost for the drug. When you and the drug plan have paid a total of $3,700 for drugs in 2017, you enter the coverage gap or doughnut During this second phase, you will pay no more than 40 percent of the plan's price for a brand-name drug and 51 percent for a generic drug. — Read Full Answer
If you plan to travel a lot or simply want to choose doctors without concerns over only picking providers on an HMO or PPO network, you might compare Medigap plans. With a supplement, you will have to buy Medicare Part D to cover most prescription medications. This may cost somewhat more, but some folks prefer to choose their drug plan separately from the rest of their medical benefits.
There is some controversy over who exactly should take responsibility for coordinating the care of the dual eligibles. There have been some proposals to transfer dual eligibles into existing Medicaid managed care plans, which are controlled by individual states.[143] But many states facing severe budget shortfalls might have some incentive to stint on necessary care or otherwise shift costs to enrollees and their families to capture some Medicaid savings. Medicare has more experience managing the care of older adults, and is already expanding coordinated care programs under the ACA,[144] though there are some questions about private Medicare plans' capacity to manage care and achieve meaningful cost savings.[145]
Since the Medicare program began, the CMS (that was not always the name of the responsible bureaucracy) has contracted with private insurance companies to operate as intermediaries between the government and medical providers to administer Part A and Part B benefits. Contracted processes include claims and payment processing, call center services, clinician enrollment, and fraud investigation. Beginning in 1997 and 2005, respectively, these Part A and B administrators (whose contracts are bid out periodically), along with other insurance companies and other companies or organizations (such as integrated health delivery systems, unions and pharmacies), also began administering Part C and Part D plans.
The open enrollment period for Medicare runs from October 15 through December 7 on an annual basis, however, this is not the case for individuals interested in Medigap (Medicare Supplement) coverage. The open enrollment period for a Medigap policy is the six month period that starts the first day of the month that you turn 65 or older and enrolled in Part B. After this period, your ability to buy a Medigap policy may be limited and it may be more costly. Each state handles things differently, but there are additional open enrollment periods in some cases.

Price transparency: To get a quote you can either call a United Medicare Advisors representative or complete an online form with your contact and health details. Upon sending it off, an agent will contact you with suggested plans. United Medicare Advisors need personal information to form a tailored quote for each individual. Their website says they save consumers an average of around $634 per year by switching to a new Medigap plan.

Medicare has four parts: loosely speaking Part A is Hospital Insurance. Part B is Medical Services Insurance. Medicare Part D covers many prescription drugs, though some are covered by Part B. In general, the distinction is based on whether or not the drugs are self-administered but even this distinction is not total. Public Part C Medicare health plans, the most popular of which are branded Medicare Advantage, are another way for Original Medicare (Part A and B) beneficiaries to receive their Part A, B and D benefits; simply, Part C is capitated fee and Original Medicare is fee for service. All Medicare benefits are subject to medical necessity.
Since the Medicare program began, the CMS (that was not always the name of the responsible bureaucracy) has contracted with private insurance companies to operate as intermediaries between the government and medical providers to administer Part A and Part B benefits. Contracted processes include claims and payment processing, call center services, clinician enrollment, and fraud investigation. Beginning in 1997 and 2005, respectively, these Part A and B administrators (whose contracts are bid out periodically), along with other insurance companies and other companies or organizations (such as integrated health delivery systems, unions and pharmacies), also began administering Part C and Part D plans.
More limited income-relation of premiums only raises limited revenue. Currently, only 5 percent of Medicare enrollees pay an income-related premium, and most only pay 35 percent of their total premium, compared to the 25 percent most people pay. Only a negligible number of enrollees fall into the higher income brackets required to bear a more substantial share of their costs—roughly half a percent of individuals and less than three percent of married couples currently pay more than 35 percent of their total Part B costs.[149]
Medicare differs from private insurance available to working Americans in that it is a social insurance program. Social insurance programs provide statutorily guaranteed benefits to the entire population (under certain circumstances, such as old age or unemployment). These benefits are financed in significant part through universal taxes. In effect, Medicare is a mechanism by which the state takes a portion of its citizens' resources to provide health and financial security to its citizens in old age or in case of disability, helping them cope with the enormous, unpredictable cost of health care. In its universality, Medicare differs substantially from private insurers, which must decide whom to cover and what benefits to offer to manage their risk pools and ensure that their costs don't exceed premiums.[citation needed]
On January 1, 1992, Medicare introduced the Medicare Fee Schedule (MFS), a list of about 7,000 services that can be billed for. Each service is priced within the Resource-Based Relative Value Scale (RBRVS) with three Relative Value Units (RVUs) values largely determining the price. The three RVUs for a procedure are each geographically weighted and the weighted RVU value is multiplied by a global Conversion Factor (CF), yielding a price in dollars. The RVUs themselves are largely decided by a private group of 29 (mostly specialist) physicians—the American Medical Association's Specialty Society Relative Value Scale Update Committee (RUC).[57]

It is important to understand your Medicare coverage choices and to pick your coverage carefully. How you choose to get your benefits and who you get them from can affect your out-of-pocket costs and where you can get your care. For instance, in Original Medicare, you are covered to go to nearly all doctors and hospitals in the country. On the other hand, Medicare Advantage Plans typically have network restrictions, meaning that you will likely be more limited in your choice of doctors and hospitals. However, Medicare Advantage Plans can also provide additional benefits that Original Medicare does not cover, such as routine vision or dental care.


The highest penalties on hospitals are charged after knee or hip replacements, $265,000 per excess readmission.[34] The goals are to encourage better post-hospital care and more referrals to hospice and end-of-life care in lieu of treatment,[35][36] while the effect is also to reduce coverage in hospitals that treat poor and frail patients.[37][38] The total penalties for above-average readmissions in 2013 are $280 million,[39] for 7,000 excess readmissions, or $40,000 for each readmission above the US average rate.[40]

This website and its contents are for informational purposes only. Nothing on the website should ever be used as a substitute for professional medical advice. You should always consult with your medical provider regarding diagnosis or treatment for a health condition, including decisions about the correct medication for your condition, as well as prior to undertaking any specific exercise or dietary routine. 

If you forgo supplemental insurance, then you’re responsible for out-of-pocket health insurance costs – that can quickly cost thousands of dollars. If you’re on a fixed income, this may quickly eat into your retirement savings. Unless you can guarantee that you won’t have more than a sniffle for the rest of your life, coverage is probably a good financial move.
To be eligible to enroll in a Medicare Supplement insurance plan, you must be enrolled in both Medicare Part A and Part B. A good time to enroll in a plan is generally during the Medigap Open Enrollment Period, which begins on the first day of the month that you are both age 65 or older and enrolled in Part B, and lasts for six months. During this period, you have a guaranteed-issue right to join any Medicare Supplement insurance plan available where you live. You may not be denied basic benefits based on any pre-existing conditions* during this enrollment period (although a waiting period may apply). If you miss this enrollment period and attempt to enroll in the future, you may be denied basic benefits or charged a higher premium based on your medical history. In some states, you may be able to enroll in a Medigap plan before the age of 65.
Remember, Medicare Advantage plans may offer additional benefits that are not offered in Original Medicare coverage. Beneficiaries who need prescription drug coverage may prefer the convenience of having all of their Medicare coverage included under a single plan, instead of enrolling in a stand-alone Medicare Prescription Drug Plan for Medicare Part D coverage. However, every person’s situation is different, so it’s a good idea to review your specific health needs, and compare Medicare Advantage plans in your area to find a plan option that best suits your needs.
Payment for physician services under Medicare has evolved since the program was created in 1965. Initially, Medicare compensated physicians based on the physician's charges, and allowed physicians to bill Medicare beneficiaries the amount in excess of Medicare's reimbursement. In 1975, annual increases in physician fees were limited by the Medicare Economic Index (MEI). The MEI was designed to measure changes in costs of physician's time and operating expenses, adjusted for changes in physician productivity. From 1984 to 1991, the yearly change in fees was determined by legislation. This was done because physician fees were rising faster than projected.
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