Social Security is a federal program providing retirement, disability, and survivor benefits to wage earners and their spouses, former spouses, widows, widowers and children. Eligibility for benefits under the program are based up on the wage earner’s work history. The amount of the monthly Social Security benefit is based upon a number of factors including the number of years worked and the amount of earnings during those years.
Medicare is a federal health insurance program that provides health care benefits to the following:
- persons age 65 and older;
- individuals with certain disabilities that are under the age of 65 years;
- disabled children of certain wage earners;
- individuals with permanent kidney failure.
There are different parts of Medicare to help cover specific services:
Medicare Part A
Part A provides coverage for inpatient hospital stays, limited coverage for rehabilitation in a skilled nursing facility after a hospital stay, hospice care, and some home health care. For most Medicare beneficiaries, there is no monthly premium for Part A
Medicare Part A does not cover your full bill. Here is what you are responsible for out-of-pocket for a hospital stay (as of 2021):
Deductible of $1,484 for each benefit period
Days 1-60: $0 coinsurance
Days 61-90: $371 coinsurance per day
Days 91+: $742 coinsurance per each "lifetime reserve day" after day 90 (up to 60 days over your lifetime)
After lifetime reserve days have been used: All costs
For Medicare Part A to cover skilled nursing care, you must first have a qualifying hospital stay of at least 3 days in inpatient status prior to being discharge to the skilled nursing facility for care. If you had a qualifying hospital stay before ending the skilled nursing facility, then here is what you are responsible for out-of-pocket (as of 2021):
Days 1-20: $0 for each benefit period
Days 21-100: $185.50 coinsurance per day of each benefit period
Days 100+: All costs
Do not make the mistake of assuming that Medicare will pay for your nursing home care. Medicare covers very little if any, of the nursing home bills of most seniors. If your nursing home stay is not preceded by a 3-day inpatient stay, then Medicare will not cover any of the nursing home bill. Even if your nursing home stay was preceded by a qualifying hospital stay, as you'll see from the figures above, coverage is for a very limited period of time.
Medicare Part B
Part B provides coverage for certain doctors' services, outpatient care, medical supplies, and preventative care. Most Medicare Part B beneficiaries pay for the Part B coverage via a monthly premium that is deducted from their monthly Social Security benefits. For 2021, the standard part B premium amount is $148.50. However, some will pay less than this because of a cap on the premium since it increased more than the Social Security cost-of-living adjustment, while others may pay a higher amount if they have higher income.
For Part B, you pay a deductible of $203 per year. After you have met your deductible, then you generally will pay 20% of all Medicare-approved services covered by Part B.
Medicare Part C
Part C, also known as Medicare Advantage Plans, is a type of Medicare health plan offered by a private company that has a contract with Medicare to provide your Medicare Part A and Part B services. Most Medicare Advantage Plans offer prescription coverage. While there are certain benefits that must be included, each Medicare Advantage plan can charge different out-of-pocket costs and have different rules for you get your health care services.
Medicare Part D
Part D adds prescription drug coverage. To get coverage, you must join a plan run by an insurance company or a private company approved by Medicare. The plans can vary in cost and which drugs are covered.
Medicaid is a program for low-income and needy people. It provides coverage to children, the aged, and/or disabled, and others who are eligible to receive assistance. It is derived from federal law but is administered by each respective state, thus the rules for North Carolina may vary a bit from rules in other states. The program is funded by both federal and state funds. There are various Medicaid coverage programs for different populations. The most common coverages that we see in our office are for seniors needing help with their nursing home care or individuals with special needs that need assistance.
To read more about Medicaid coverage for nursing home care in North Carolina, check out The Ultimate Guide to Paying for Nursing Home Care in North Carolina authored by Cary elder law attorney, Jackie Bedard.