Understanding Medicare Part B

Medicare has four parts, or programs, that provide coverage for different health-related services. Understanding how Medicare works may help you choose the Medicare options that best fit your needs.

Medicare Part B, also known as the Medical Insurance program, helps pay for medically necessary services, such as:

• Doctors’ services
• Outpatient care
• Some home health services, such as physical and occupational therapy
• Some preventive services

If you are 65 or older (and get benefits from Social Security or the Railroad Retirement Board), you are automatically eligible for Medicare Part B. Your Medicare Part B coverage starts on the first day of the month you turn 65. You also should receive your Medicare card in the mail three months before your 65th birthday.

If you are under 65, you are eligible to receive Part B benefits under the following circumstances:

• You have been receiving Social Security Disability Insurance for more than two years – you should get your Medicare card in the mail prior to your 25th month of disability.
• You have permanent kidney failure (end-stage renal disease, or ESRD) requiring ongoing dialysis or a kidney transplant. Special rules apply for people with ESRD – for more information view Medicare Coverage of Kidney Dialysis and Kidney Transplant Services.
• You have been diagnosed with amyotrophic lateral sclerosis (Lou Gehrig’s disease). If you have ALS, you get Part A the month your disability benefits begin.

You will need to pay a monthly premium for Part B that can be deducted from your monthly social security check. Most people pay a standard monthly premium for Part B, which is $96.40. For 2010, if you had a high income in 2008 (over $85,000 per individual; $170,000 per couple), you will have to pay a higher monthly premium for Part B, ranging from $154.70 to $353.60.

Medicare Part B is a voluntary program and you can opt out of it and not pay the monthly premium. If you do not want Medicare Part B, follow the instructions that come with your Medicare card. You will need to send the card back. If you want to stay in Medicare Part B, just keep the card and you will have Part B premiums deducted from your social security check.

If your income is limited and you cannot afford the monthly premium Part B, your state may have a program to help. For information view the brochure Get Help With Your Medicare Costs and visit the State Health Insurance Assistance Program (SHIP) site for information about free counseling in your state.

Medicare Part B has an annual deductible, which in 2010 is $155.00. You must pay all costs until you meet this yearly deductible before Medicare starts to pay its share. After you meet your deductible, you may be responsible for a coinsurance of 20% of the Medicare-approved amount for the service.

In general, Medicare Part B covers two types of services:

• Medical services – healthcare services (and related supplies) that you may need to diagnose and treat a medical condition. Medicare will only pay for services that they define as being medically necessary.
• Preventive services – healthcare services to prevent illness (such as a flu shot) or help detect an illness in an early stage so it can be managed before getting worse (such as screening for colon cancer).

Medical Services
Some examples of covered medical services include:

• Ambulance Services – only if necessary and only to the nearest appropriate medical facility
• Clinical Laboratory Services – certain blood tests, urine tests, and some screening tests
• Diabetes Supplies – blood sugar monitors, test strips, and lancets
• Doctor Services – care and prevention services that you get from your doctors in their office and some services provided in the hospital
• Durable Medical Equipment – things your doctor orders for use in the home, such as oxygen equipment, wheelchairs, walkers, and hospital beds
• Emergency Room Services – treatment of a serious injury or sudden illness
• Mental Health Care – diagnosis and treatment of mental health conditions such as depression, anxiety, or substance abuse
• Occupational Therapy, Physical Therapy, and Speech-Pathology Services – to help you return to more normal function after an illness or injury
• Hospital Outpatient Services – includes doctor services in a hospital outpatient department and other services such as X-rays, EKGs, scans, a cast, or wound management)

Prevention Services
Some examples of covered prevention services include:

• Abdominal Aortic Aneurysm Screening – a one-time screening for people at risk
• Bone Density Test – screens for osteoporosis to see if you are at risk for broken bones
• Cancer Screening – several tests are covered to help detect certain cancers, such as colorectal cancer, breast cancer, cervical cancer and prostate cancer
• Diabetes Screening – blood tests for people at risk for diabetes
• Glaucoma Tests – for people at high risk for glaucoma, a serious eye disease
• Heart Disease Screening – blood tests, such as cholesterol, to help determine your risk of a heart attack
• Shots – coverage includes the flu shot, hepatitis B shot, and pneumococcal shot
• Smoking Cessation – counseling to help you stop smoking

Note: The above lists are only a partial outline of services covered under Medicare Part B. For a full list, that also includes which services are subject to the annual deductible and coinsurance, see Medicare & You 2010, which you should have received in the mail. You also can view an updated version on the Medicare website.

While Medicare Part B will most likely pay for most of your outpatient medical expenses, you still may have some out-of-pocket costs. So, you may want to consider a Medigap plan to help pay these out-of-pocket costs such as the annual Part B deductible, coinsurance charges and copayments. If you enroll in a Medicare Advantage plan, some of these costs may also be covered.