Medicare-covered services are in the main, not paid 100% by Medicare, although there are a number of exceptions. The following schedule of categories of benefits illustrates the gaps, and you are referred to Publication No. CMS-10050, “Medicare & You 2007”, for the full details of all benefits.

Year 2008

                                Medicare Benefits

Gaps

Part A

Patient Risk

Hospital
	First 60 days in benefit period*:	$1024
	Next 30 days 61-90 (continuous confinement):	$256 each day
	Days 91-150 charged against lifetime aggregate reserve of 60 days:	$512 each day
	After Day 90, if lifetime reserve days have been used:	100%

Skilled Nursing Facility
	First 20 days in full:	Nothing
	Next 80 days (continuous confinement)	$128.00 each day

Part B - Medical

Medicare pays 80% of approved charges after a deductible of:	First $135 per calendar year
Therefore, patient’s risk is:	**20% of approved amount

*Each “benefit period” begins with the first day at the hospital or skilled nursing facility, and ends after the patient has been out of that facility for 60 consecutive days (including date of discharge).

**The exceptions are hospital outpatient services which may vary according to the service. Refer to Publication No. CMS-0218, “Your Guide to the Outpatient Prospective System” for details of the new payment procedure.

The above chart clearly indicates the potential financial liability for the Medicare Beneficiary who does not have Medigap, HMO, Medicaid or an Employer Health Retirement Plan. But the point I make goes far beyond finances. This individual may be intimidated by possible additional expenditures from going to a specialist, or seeking a second or third opinion. I dislike seeing any person caught in this trap, and will address the possibilities for avoiding this lack of supplementary coverage in the Medigap, HMO and Medicaid Pages.

An expense to be avoided is the penalty for late enrollment in Medicare Part B -- 10% surcharge on the premium (currently $96.40, but paid by Medicaid for qualified low-income persons) for each year late. Over the years I have continuously seen such cases. You may initiate the application for Medicare Part A and Part B during a seven-month period beginning three months before the 65^th birthday. I advise clients to file for Medicare benefits three months before age 65. If you do not enroll in Medicare Part B in the seven-month period, you will have to wait until the general enrollment period, January 1 through March 31, and the Part B coverage will become effective July 1. However, if you have group health insurance based on you own, or spouse’s current employment, you may delay Part B enrollment without having to pay higher premiums.

During the period of non-coverage for Part B services you will be billed “Actual Charge” by the health care provider and this may be more than the Medicare approved amount. People taking early Social Security will be automatically enrolled in Part A and Part B, and receive their Medicare cards about three months before their 65^th birthday. They will have the opportunity to reject Part B. Don’t! Those who continue working after 65 and have employee health coverage need to decide, after close examination of the coverage, whether they wish to enroll in Part B Medicare; and they should refer to CMS Publication 02179 “Medicare and Other Health Benefits: Your Guide to Who Pays First” and the local Social Security office for full eligibility and enrollment rules. The disabled, kidney dialysis or kidney transplant patient, retired government employees without Social Security and spouses of those who are Social Security-eligible need to look to Social Security for guidance on relevant rules and regulations as well as to appropriate CMS reference material.

Updated: January 4, 2008

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