Is Catastrophic HealthCare coverage good or bad


Medicare is a health insurance company in the US that helps older people pay for their medical services. It is funded and regulated by the US federal government, which publishes detailed information about the insurance at In 2020, around 62 million US citizens were covered by Medicare. Of these, 86% were at least 65 years old. Younger people with certain disabilities are also covered by Medicare.

Medicare insurance is divided into different types depending on the benefits.

The original Medicare insurance (sometimes referred to as "fee-for-service" insurance, as providers are individually remunerated for each service provided) has two parts:

  • Part A: Treatment in hospital, hospice care, professional care facilities (under certain circumstances)

  • Part B: Services of doctors and other health professionals, outpatient care and certain medical devices

The original Medicare insurance is available nationwide and is administered by private companies called Medicare Administrative Contractors. A full description of the benefits under Part A and B and other provisions (under the title “Medicare & You”) is available at or by calling 800 633 4227.

Optional Medicare Insurance (funded by Medicare, but compiled and managed by private insurance companies) also exist.

  • Part C: Medicare Advantage (a range of alternatives to original Medicare insurance that include managed care programs, preferred provider programs, and private fee-for-service insurance)

  • Part D: Prescription Drugs

Every US state has a State Health Insurance Assistance Program that people can call for advice on choosing a Medicare program, clarification of bills and declined payments, and legal process.

Medicare eligibility

In general, to be eligible for Medicare, the following criteria must be met:

  • Over 65 years old

  • Dialysis patient or kidney transplant

  • Younger than 65 years with certain disabilities

  • Amyotrophic Lateral Sclerosis

Under 65s who have met Social Security Disability Insurance requirements for at least 24 months may be eligible for Medicare.

Deductibles and co-payments

Medicare only pays for benefits it deems appropriate (known as covered benefits). For each benefit covered, Medicare has what is known as an Eligible Billable Amount. The Billable Amount Allowed is the maximum Medicare health care providers are allowed to charge to Medicare-insured people for a service. However, Medicare does not pay all eligible billable amounts for covered benefits. Typically, when a particular benefit is needed for the first time, people must pay a small, fixed amount (called a deductible) before Medicare pays anything. If the same service is required again after a certain period of time, a further deductible must be paid. After paying the deductible, the patient usually has to pay a certain percentage of the costs (a so-called copayment) every time he uses this service. In 2021, the co-payment for outpatient services (such as a doctor's visit) is $ 203 per calendar year, and the co-payment for each use of most outpatient services is 20% of the billable amounts allowed. This agreement means that patients will pay the first $ 203 of outpatient bills. After that, for the remainder of the year, they pay 20% of the eligible billable amounts each time they receive a benefit, and Medicare pays the remaining 80%. When the calendar year is over, the process starts over, i.e. This means that the patient has to pay the deductible again for the services used this year.

Medicare supplementary insurance

Some people have supplemental insurance (Medigap) to cover co-payments for Medicare and other medical expenses not covered by Medicare. This insurance is sometimes provided by the person's former employer as part of a retirement plan. Other people take out supplementary health insurance with a private insurer.

Because Medicare and Medigap do not cover long-term care, some people buy separate long-term care insurance. The decision to take out long-term care insurance depends in part on whether the person is likely to need assistance with paying for long-term care and whether they can afford the insurance premium.

Low-income, low-wealth people may be eligible for additional coverage through the government-funded Medicaid program.

Original Medicare Insurance (Parts A and B)

The original Medicare insurance is available nationwide, is administered by private companies, the so-called Medicare Administrative Contractors, and works on a “fee-for-service” basis. It consists of two parts:

  • Part A (often referred to as “Hospital Insurance”) covers hospital treatment and certain outpatient services that are often required for a short period of time after a hospital stay.

  • Part B (often referred to as "Medical Insurance") covers outpatient treatment, including medical expenses.

The original Medicare insurance pays a fixed amount for each service covered, which is considered a customary, customary and reasonable amount. Under Part B, doctors have the option of being paid direct by Medicare (referred to as a referral) so that they receive 80% of the allowable billable amount directly from Medicare and 20% as a co-payment from the patient (after the deductible). Physicians who accept Medicare must make their own claim within one year of the service being provided. However, patients should ensure that claims are submitted in a timely manner, as Medicare cannot count payments towards patient deductibles until an insurance claim has been submitted.

With original Medicare insurance, there are no restrictions on the choice of doctor and hospital. However, some doctors do not accept Medicare payments as full payments (that is, they do not accept Medicare "assigned payments"). You may be charging more than Medicare pays for a service. These doctors can charge up to 15% on top of the Medicare approved amount. (Doctors who charge more than this additional 15% may be fined.) Payment of any additional costs is the responsibility of the policyholder. Some doctors require the patient to pay the bill and fill out the appropriate forms (to make a claim) for Medicare reimbursement. Therefore, patients should always ask their doctor beforehand whether they will accept Medicare as full payment.

Did you know ...

  • Patients should always ask their doctor beforehand whether they will accept Medicare as full payment.

Part A

Admission to Part A takes place automatically at the age of 65 for people who have already received social security benefits or benefits from Railroad Retirement for at least four months. Such individuals will receive a Medicare card (as part of the Medicare Welcome Package) approximately three months before their 65th birthday. Other people who, for example, continue to work after reaching the age of 65 must register for Part A by contacting the. During the initial period of admission (a period of seven months with three months each before and after their 65th birthday) Contact social security. It often costs more to be included in the insurance after this period has expired.

Part A is funded by a federal tax that is automatically deducted from salary every month (just like for social security). For this reason, people who have been in employment for long enough do not have to pay monthly contributions for Part A. People who do not meet the criteria due to insufficiently long employment may have to pay for Part A.

Part A helps pay for the following:

  • Treatment in hospital

  • Care in a qualified care facility, but only if the services are required daily after a hospital stay of at least three days

  • Home medical care (certain types)

  • Hospice care, but only for people who are about to die

For people who are home-bound and require qualified part-time nursing or rehabilitation, Part A helps pay for outpatient medical care, including assistance with personal hygiene (such as bathing, going to the toilet, and getting dressed ). Part A does not make payments for outpatient medical care or long-term care that does not include qualified nursing.

If the individual opts for hospice care, the hospice facility organizes all Medicare (and Medicaid) coverage.

Part A pays for the care based on the agreed service duration. In hospital care, the benefit period starts when a person is admitted to the hospital and ends after they have left the hospital for 60 consecutive days. If a patient is admitted to a hospital, he or she has to pay a deductible. Most of the remaining costs are covered by Medicare ({blank} restrictions on Part A and B). If the person is re-admitted after the 60 days have expired, a new deductible must be paid. The benefit period can be used as often as you like. If a hospital stay extends over 60 days, the patient has to pay a percentage of the costs. These costs are as follows:

  • For Day 1 through Day 60: A deductible for each benefit duration ($ 1,484 in 2021)

  • For Day 61 through Day 90: A co-payment equal to a quarter of the deductible per day ($ 371 per day in 2021)

  • From day 91 (so-called reserve days), but not more than 60 days for life: an additional payment of half of the deductible (USD 742 per day in 2021)

  • After the 60 reserve days per service life have expired: All costs

If you are staying in a qualified care facility, Medicare will only pay the cost of services if you are staying immediately or shortly after you are discharged from the hospital. Medicare usually covers all costs for stays of 20 days or less. Medicare will cover part of the cost for the next 80 days, but patients will have to make a co-payment (US $ 185.50 per day in 2021). The patients then have to pay the full amount.

Part B

This part is optional. If people meet the criteria for Part A, they are also entitled to Part B. People who choose to be insured can be insured under Part B for a monthly premium. The amount is usually deducted from your Social Security or Railroad Retirement or Civil Service Retirement benefits. The best time to apply for insurance under Part B is during a free health insurance choice ("Open Enrollment"). Otherwise the contributions can be higher. At the age of 65, some people or their spouse are still working. Many of these people have health insurance through their employer or their spouse's employer. These people have a delayed enrollment option, which allows them to join Part B at a later date, but still at the “open enrollment” rate. The “Open Enrollment” contribution rate for Part B changes annually. In 2021, the amount will be $ 148.50 per person per month per month, but will be higher if the 2019 annual income was above $ 88,000 for single people and above $ 176,000 for married couples filing joint tax returns. These contribution rates range from $ 207.90 to $ 504.90, depending on your income.

Part B helps pay for many services and supplies that are provided on an outpatient basis and are medically necessary, such as B .:

  • Visits to the emergency room

  • Outpatient surgery (without an overnight stay in hospital)

  • Ambulance transport if any other mode of transport is likely to pose a health risk

  • Outpatient psychiatric care

  • Reusable (durable) medical equipment, such as B. Wheelchairs and many other items for domestic use (see List of Covered Services at

Part B may cover the costs of outpatient medical care for people who are tied to the house, provided that Part A does not cover the costs. If surgery is recommended, Part B will help pay for a second opinion and, if the opinions differ, a third opinion as well. In the case of diabetics, Part B assumes certain costs for monitoring the blood sugar level (blood glucose). Part B also helps pay for certain preventive care. Examples are the annual flu shot and screening tests, such as B. Mammograms, Pap tests, bone density measurements and tests for prostate and colon cancer. Part B also helps pay for glaucoma checkups for those at increased risk because they are African American and over 50, have diabetes or have a family history of glaucoma.

Limitations for Part A and B.

Neither Part A nor Part B covers:

  • Privately organized care

  • Telephone and TV in the hospital

  • A private hospital room (unless medically necessary)

  • Most prescription drugs and all over-the-counter drugs

  • Personal hygiene at home or in a nursing home, unless the person is in need of qualified nursing or rehabilitation

  • Ophthalmological care

  • Dental care

  • Supply outside of the United States, except in specific circumstances

  • Some preventive care procedures

  • Most chiropractic services

Medicare Advantage (Part C)

Medicare Advantage (Part C) enables admission to private health insurance instead of traditional Medicare insurance based on the “fee-for-service” principle (Part A and B). As part of this insurance, Medicare pays other organizations, such as B. Insurance companies, hospital systems or managed care organizations. Medicare Advantage is available in many regions of the United States. Insurance plans vary by state.

Most Medicare Advantage insurance plans are managed under a managed care system. However, some are unrestricted, private insurances based on the “fee-for-service” principle (remuneration for individual services). In the case of the latter, the insured person can choose any doctor or hospital and the insurance pays part of the costs. However, a private company, not Medicare, sets the cost here, so the cost can be higher than under the original Medicare insurance.