Medicare: The Low-Down on a “Catchall” Solution

 

Medicare private insurance graph

People who have not yet attained “senior status” may mistakenly believe that once they turn 62, concerns about future long-term care expenses will vanish: “Medicare will cover it”! While Medicare is certainly a blessing for older adults, it’s not a cure-all or a catchall, and seniors must become aware of how eligibility will impact their health, finances and living arrangements.

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At the top of the list of potential health and lifestyle changes is the new Affordable Care Act (ACA), signed into law by President Obama in March 2010 and due to take effect January 1, 2014. The ACA purports to:

  • Help Medicare recipients with the cost of prescription medications
  • Increase access to preventive care
  • Boost support for primary care practitioners
  • Offer seniors more Medicare advantages.

Yet even with its implementation imminent, the ACA legislation is still under fierce debate. Recent news reports reveal some insurers are limiting their networks of doctors and hospitals to those who are willing to accept less reimbursement. Doctors have been facing cuts in Medicare reimbursements as well, and some are now choosing to limit their practice to private pay and non-Medicare insured patients. Hospitals are streamlining staff in order to remain profitable, which translates to fewer doctors, nurses, and support personnel available to provide patient care.

However, regardless of what effect the ACA will have, it’s important for seniors and those who care about and for them to understand how Medicare works. Medicare will only cover long-term care under certain circumstances.

Medicare Part A (hospital insurance) will pay for:

  • Hospital care
  • Skilled nursing facility (SNF) care
  • Nursing home care (as long as the care involves skilled nursing — if someone only needs assistance with activities of daily living such as bathing, dressing, etc., in most cases Medicare will not cover it)
  • Hospice (end-of-life care, usually in the patient’s own home)
  • Home health services

Although Medicare will not cover the cost of assisted living, for example, it will cover qualified health care costs incurred while a senior resides in an assisted living facility. Medicare is therefore a temporary and/or partial resource, not a long-term subsidized housing solution.

Medicare Part B (medical insurance) covers medically necessary services and preventive care: physician services, lab and x-ray services, durable medical equipment, outpatient and other services.

Medicare Part C, the Medicare Advantage Plan, is supplemental insurance offered by private, Medicare-approved companies.

Medicare Part D covers prescription medication.

Because federal and state laws affect Medicare’s various plans, it’s essential to know what coverage you have. Medicare.gov explains the different types of coverage simply, and provides an easy way for you to check whether your service or test is covered.

What about Medicaid? This program is more of a “last resort” because it generally requires individuals to have exhausted their personal assets — although this is projected to change somewhat under the ACA. Watch for a detailed Medicaid overview in an upcoming post.

Bottom line: both housing and health care are critical factors for an aging population. The more knowledgeable seniors and their loved ones become about how to finance their future, the better equipped they will be to manage these arrangements and costs when the time arrives. This senior living financing guide can assist you on your journey.

About the Author:

Amara Rose is a personal and business coach with a broad background in health and positive aging. She writes widely about senior housing, elder health and nutrition, lifelong learning and the spiritual dimension of aging. Contact her via amara@liveyourlight.com

 

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