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Medicare in Plain English

CVCOA has prepared the following summary as a basic introduction to the parts that make up the Medicare system.

For more information about Medicare and to apply, visit www.medicare.gov


Medicare Part A:

  • Covers hospitalization, hospice and home health.

  • You receive this automatically when you turn 65 or after your second year of disability.

  • Most people do not pay a premium for Part A. If you or your spouse have worked a minimum of 10 years you generally are not required to pay a premium.

  • The deductible for 2016 is $1,288 for each hospital stay of 1-60 days.

Are You a Hospital Inpatient or Outpatient? If you have Medicare, ASK!

Your hospital status affects how much you pay for hospital services and may also affect whether Medicare will cover any care you receive in a skilled nursing facility. An overnight stay at the hospital does not necessarily mean you have been admitted and are considered an inpatient.

Medicare Part B:

  • This is optional health care coverage. Part B pays 80% of the approved costs for doctors, diabetic supplies, medical equipment, and some medications.

  • Part B has a monthly premium of $104.90 that is automatically deducted from your Social Security income.

  • Your annual deductible for Part B is $166.

  • If you do not enroll in Part B when it is first offered you will start to build up a penalty of 10% per year for every year you do not enroll (unless you have other healthcare insurance through an employer who has 20 or more employees.)

Medicare Part C:

  • This is another option for health care coverage. The plans are called “Advantage Plans.”

  • They replace original Medicare, although you will continue to pay the deductible for your Part B coverage.

  • These plans do not cover 100% of the cost of your care; they are cost-sharing plans.

Supplement Plans:

  • These plans are often referred to as “Medigap.”

  • They are private insurances that can cover up to 20% of the cost of your care that Medicare does not.

  • Because supplement plans vary in the coverage they provide, their cost varies as well.

  • There are Supplement Plans that will cover your Part A deductible for every hospital admission.

  • Some Supplement Plans will fully cover all of your health care (except Part D drugs) as long as you have Medicare Part A and Part B.

  • Be aware that if you do not go to a Medicare-approved provider then neither Medicare nor the Supplement will pay.

Medicare Part D:

  • This is your prescription drug coverage.

  • These are Private Drug Plans that have agreed to provide drug coverage at a specific cost to you.

  • The coverage is determined by entering your medications into the Center for Medicare and Medicaid’s website and locating a plan that is both affordable and will cover most of the cost of your medicine. Visit www.cms.gov

  • It is important that you determine if you are eligible for either State or Federal Assistance (based upon gross monthly income) that would help you with the costs associated with this plan.

  • Like Medicare Part B, if you do not enroll in a Part D plan and do not have other drug coverage you will accrue a penalty of 1% of the average cost of a Part D plan for every month you are not enrolled.

Limited Income Subsidy:

  • For  more information and to apply, visit www.ssa.gov/medicare/prescriptionhelp/

  • You may be eligible to have the Federal Government pay for all or part of your Part D.

  • The eligibility for this is determined by your income and assets.

    • The income limit for one person is $17,505; for a couple it is $23,595.

    • The asset limit for one person is $18,660; for a couple it is $23,595.

Medicare and the Vermont Health Exchange:

The US Department of Health and Human Services has prepared a resource answering Frequently Asked Questions about People with Medicare and the Health Insurance Marketplace


Our Trained Counselors Can Help!

Call the Senior HelpLine at 1-800-642-5119