Since we spend all of our work lives paying Social Security taxes, it’s important to understand what services those taxes actually provide. That way, when the time comes in which we’ll need those services, we’ll know exactly what to expect.
One of the six categories of social security benefits is Medicare. Within Medicare, there are actually four parts. In this post, we’ll look at the first part – Medicare Part A.
Medicare Part A Benefits
Here’s a list of services that are covered under Part A:
- Inpatient care in hospitals (such as critical access hospitals, inpatient rehabilitation facilities, and long-term care hospitals)
- Inpatient care in a skilled nursing facility (excludes custodial or long term care)
- Hospice care services
- Home health care services
- Inpatient care in a Religious Nonmedical Health Care Institution
Medicare Part A Cost
How much does it cost? If you or your spouse paid Medicare taxes for at least 10 years while working, then you don’t have to pay a monthly premium for Part A coverage. Part A is also known as “premium-free Part A.”
However, if you’re not eligible for premium-free Part A, you may be able to buy Part A if you meet one of two conditions:
- You’re 65 or older, you’re entitled to (or enrolling in) Part B, and you meet the citizenship or residency requirements.
- You’re under 65, disabled, and your premium-free Part A coverage ended because you returned to work.
If you don’t get Part A premium-free, you’ll have to pay up to $461 a month in 2010. And if you only have between 30 to 39 quarters of Medicare-covered employment, you’ll have to pay $254 a month.
It’s important to note that if you do buy Part A, in most cases you’ll also need to have Part B and pay monthly premiums for both.
Medicare Part A Eligibility
You’ll be eligible for Medicare when you turn age 65, even if you’re not yet eligible for full Social Security retirement benefits. If you’re age 65 or older, you can get Part A without paying premiums if
- You already get retirement benefits from Social Security or the Railroad Retirement Board
- You’re eligible to get Social Security or Railroad benefits but haven’t filed for them yet.
- You or your spouse had Medicare-covered government employment.
If you’re under age 65, you can get Part A without having to pay premiums if either of the following applies to you:
- You’ve received Social Security or Railroad Retirement Board disability benefits for 24 months.
- You have permanent kidney failure requiring a dialysis or transplant.
When To Apply For Medicare
If you’re already getting Social Security retirement or disability benefits or railroad retirement checks, you’ll be contacted a few months before you become eligible for Medicare and given the information you need.
If you’re not getting retirement benefits yet, you should contact your local Social Security office three months before your 65th birthday to sign up for Medicare. You can sign up for Medicare even if you don’t plan to retire at age 65.
Medicare Benefit Period
The number of days that Medicare covers your care in a hospital or skilled nursing facility is measured in benefit periods. A benefit period starts on the first day you receive services in a hospital or skilled nursing facility, and ends after you haven’t received care for 60 consecutive days. If you go into a hospital or skilled nursing facility after one benefit period has ended, a new benefit period begins. This is important to know because you must pay the inpatient hospital deductible for each benefit period.
Medicare Part A Deductible And Coinsurance Amounts For 2010
Deductible – $1,100.00 per benefit period
Coinsurance
- $275 a day for the 61st – 90th day each benefit period
- $550 a day for the 91st – 150th day for each lifetime reserve day
- 100% of the costs for each day beyond 150 days
All days over day 90 in a benefit period are considered lifetime reserve days. There are only a total of 60 lifetime reserve days, which don’t renew with each new benefit period.
Skilled Nursing Facility Coinsurance – Up to $137.50 a day for the 21st – 100th day each benefit period.
