You may know of Medicare, but many of us don’t really understand it until we are getting close to the age of eligibility. If you are one of these people or maybe a health insurance agent, you may want to begin understanding this government insurance program.

Medicare is a federal health insurance program that is composed of two parts. It provides medical coverage for older adults and for those who qualify with a disability. Medicare has Part A – Basic Hospital Insurance and Part B – Supplementary Medical Insurance.

Every American that is 65 or older and entitled to Social Security is eligible for Medicare benefits. Benefits become available to the individual on the first day of the month of the individual’s 65th birthday. Individuals under age 65 who qualified for Social Security Disability for at least two years are also eligible for Medicare benefits. If you are unsure of your eligibility, you can contact the Office of Medicare Services.

Medicare Part A provides coverage for inpatient hospital services for up to 90 days in each benefit period. Benefits also include payment for prescription drugs only while in the hospital. However, there is no coverage provided for the first three pints of blood that the individual may have received while in the hospital.

Under Part A, skilled nursing care is provided for up to one hundred days, in which the first twenty days are fully paid after the deductible is met. The next 80 days fall under the coinsurance amount of coverage. Home health services are provided for medically necessary home health visits as well as hospice care. Psychiatric hospital care is covered up to one hundred ninety days during the individual’s lifetime.

Part B provides supplementary benefits and is a voluntary medical insurance plan. Part B pays benefits for physician and surgeon fees, medical services and supplies, outpatient hospital services, x-rays, lab tests, and other services such as ambulance service and durable medical equipment. For Part B benefits, individuals pay a monthly premium and have an annual deductible. Under this plan, there are certain exclusions such as: eye and hearing examinations, routine physical exams, foot care, immunizations and private nurses. Part B plans may also be purchased through private insurance plans.

Part C is whats called Medicare Advantage plans. These plans allow participants to opt out of the traditional Part A and B and enroll in a coordinated care HMO, PPO, PSO or a private fee for service plan. Health Maintenance Organizations (HMOs) require services to be provided by its own providers, except in an emergency. Preferred Provider Organizations (PPOs) allow beneficiaries to receive services from providers outside the plan, but with higher cost sharing. Provider Sponsored Organizations (PSOs) are similar to PPOs, but they are operated by a group of physicians and hospitals. Private fee for service plans are similar to PSOs but they may pay providers more than Medicare recognizes and may charge beneficiaries additional premiums and cost sharing.

For more information on Medicare programs, contact the Center for Medicare Services. You may also want to contact your local health insurance agent to provide more information about private insurance plans and Medicare Advantage plans.

Want to find out more about Medicare Advantage Plans, then visit Bennett David’s site on how to choose the best Medicare Plan for your needs.