If you are nearing 65, you may have heard about Medicare Part A and Part B. These make up the components of Original Medicare. But, what is the difference between Medicare Part A and Part B?
In this article, we will talk about the differences between Medicare Part A and Part B and how they complement each other to provide you health insurance coverage..
How are Part A and Part B defined?
The Centers for Medicare and Medicaid Services (CMS) provides a Medicare Part A definition as follows:
- Medicare Part A includes coverage for inpatient care in hospitals, including critical access hospitals and skilled nursing facilities (SNF) (not custodial or long-term care). Part A also covers surgery, a semi-private room and meals during a hospital stay, and some home health care.
In addition, part A also covers hospice care for terminally-ill patients.
Under special cases, Part A covers confinement in the following hospitals:
- Acute care
- Critical access
- Inpatient rehabilitation
- Long-term care
- Inpatient psychiatric care
- Qualified clinical research studies
Meanwhile, the definition of Medicare Part B covers:
- Medically necessary and preventive services received in an outpatient setting.
Part B coverage includes the following:
- Outpatient care
- Doctors’ visits
- Physical and occupational therapy
- Laboratory tests
- Durable medical equipment (DME)
- Flu shots
- Emergency room services
- Ambulance services
The lists provided above are not exhaustive. They give you a general idea of the differences in coverage between Medicare Part A and Part B.
Before we go any further, we should mention that prescription drugs and other benefits such as dental, vision, and hearing are not covered by Medicare Parts A and B. You can get coverage for these other benefits through Part C (Medicare Advantage) plans and drug coverage through Part D plans.
Is there a difference in eligibility requirements for Medicare Part A and Part B?
You are qualified for Medicare Part A if you are:
- a US citizen (or a permanent resident for five consecutive years); and
- 65 or older
If you are below 65, you can also be qualified for Part A if you have been:
- Receiving Social Security disability benefits for at least 24 months
- Diagnosed with end-stage renal disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS)
Medicare Part B eligibility follows the same qualifying criteria as Part A. Therefore, there is no difference between Medicare Parts A and B as far as eligibility is concerned.
Are Medicare Parts A and B free?
Part A premiums are free, as long as you have paid Medicare taxes for at least ten years (or 40 quarters). If not, then you will typically need to pay a premium for Medicare Part A.
Does Medicare cover 100% of hospital bills?
No, with Medicare you are responsible for copays and deductibles when you use healthcare services.
For Medicare Part A, even though Part A premiums are typically free:
- You pay a deductible of $1,600 (in 2023) for any stay in a hospital before your Part A coverage starts which covers your first 60 days of a hospital stay
- From the 61st to 90th day, you pay a coinsurance of $400 per day (in 2023)
- After 90 days, you pay 100% of the costs, or $800 per day (in 2023), for any unused ‘lifetime reserve days’ (60 reserve days that can be used during your lifetime)
When it comes to Medicare Part B premiums, there is another difference to Medicare Part A – generally, everyone needs to pay Part B premiums.
The standard monthly premium for Medicare Part B is $164.90 (in 2023). But if your income (from two years ago) exceeds a certain amount, your Part B premium will be adjusted.
Part B also has an annual deductible of $226 (in 2023). After reaching this deductible, you will pay a 20% coinsurance for all Part B services received.
Is there a difference between enrollment periods for Medicare Part A and Part B?
There is no difference in enrollment periods between Medicare Part A and Part B. You can enroll in Parts A and/or Part B during the following enrollment periods:
- Initial Enrollment Period (IEP) – a seven-month period that starts three months before the month of your 65th birthday
- General Enrollment Period (GEP) – from January 1 to March 31 if you missed your IEP
- Special Enrollment Period (SEP) – if your case falls under a ‘qualifying event,’ like losing your employer coverage
Is there a difference between Medicare Part A and Part B late enrollment penalties?
There are potentially late enrollment penalties for Medicare Part A and B.
Late enrollment penalties apply if you don’t have either Medicare in place when you are 65 or other coverage Medicare considers ‘creditable’ (this typically means employer-provided insurance).
Here is a summary of the penalties:
Conclusion
Now that you are aware of the differences between Medicare Parts A and B, you can make an informed decision about your options. Remember to take advantage of applicable enrollment periods in order to avoid incurring unnecessary penalties.
The CoverRight team is here to help with any questions you may have regarding the differences between Medicare Parts A and B and how you can use private coverage to get support covering your out of pocket costs.
