4 Medicare Myths Around Long-Term Care
Maybe you’re looking forward to freeing yourself from private health insurance premiums when eligibility for Medicare, the federal health insurance program, kicks in at age 65. Or, perhaps you already have Medicare and assume that all your healthcare costs are covered, even in-home care and long-term care costs.
Unfortunately, both of these misconceptions could cost you big money in expenses, medical bills and prescriptions because you lack adequate coverage, even if you’re enrolled in Medicare.
4 Medicare Myths Debunked
“The biggest myth out there is that all people need is Medicare,” says Adam Hyers, a Medicare insurance broker in Columbus, Ohio. “Many people think that the government will take care of them, not only in the short run but in the long run too. Then they miss other items they might need, like a Medicare supplement or prescription drug plan, which help provide a good foundation but aren’t designed to pay for long-term care expenses.”
Are you up to speed on what Medicare covers, additional insurance you might need and under which circumstances Medicare pays — or won’t pay — for in-home care? If not, don’t wait to learn about Medicare coverage during a medical crisis.
The average U.S. national median cost for long-term care is around $50,000 annually for a home health aide, $48,000 for an assisted living community and $89,000 for a skilled nursing semi-private room, according to the Genworth 2018 Cost of Care Survey.
Many people purchase long-term care insurance to cover long-term care expenses. Others think they can rely on Medicare for long-term health needs. However, that incorrect assumption can be a costly mistake.
Here are four common Medicare myths debunked to help you make healthcare and insurance choices:
1. Medicare covers all health expenses.
You probably need more than Medicare Part A, which is free for most people at age 65 if they or a spouse paid into Medicare long enough while working. Did you know, however, that there are four parts to this federal health insurance, and they’re not all premium-free?
- Part A, which is free for most people, offers basic hospital coverage with a deductible of 1,364 (2019 cost) per benefit period for inpatient care in hospice, a hospital or skilled nursing residence. Part A also pays for home health services but only under specific conditions.
- Part B has a standard premium of $135 (2019 cost) a month and offers medical insurance for medically necessary services such as ambulance services, doctors, some medical equipment and outpatient procedures. Part B also covers preventative services like annual checkups, certain screenings and lab tests. The deductible for Part B is $185 (2019 cost) per year. After you meet your deductible, Medicare pays 80% of the Medicare-approved amount, and you must pay 20%.
- Part C (Advantage) combines Parts A, B and sometimes D into one plan offered by private insurance companies that charge their own premium rates.
- Part D is optional and offers coverage for prescription costs not covered by Parts A and B.
Many people think that Medicare Part A covers nearly everything regarding a hospitalization. That’s not true, says Steven Tibbits, a Medicare insurance agent with Medicare Health Plans in Salt Lake City, Utah.
“Part A comes with a deductible of more than $1,000 and mostly just covers your room,” says Tibbits. “Doctors, surgeons, testing and many other fees are covered under Part B and accompanied by coinsurance.”
2. Medicare covers most in-home long-term services.
Don’t count on Medicare when it comes to long-term in-home care, says Hyers. Medicare doesn’t cover non-medical, personal services and covers only in-home care ordered by a doctor such as skilled care from a nurse, occupational therapist, physical therapist, speech therapist or social worker. However, Medicare covers skilled in-home care ordered by a doctor for up to only 21 days.
Medicare typically pays 100% of the approved amount for covered in-home skilled nursing and therapy services and 80% of the approved amount for covered medical equipment.
3. Medicare will pay all my residential skilled nursing costs.
Not so. Medicare pays the first 20 days at a skilled nursing residence with zero copays in 2019. For days 21-100, Medicare pays a portion, and the beneficiary is responsible for the leftover amount of $170.50 per day. However, you can purchase a Medigap insurance policy through a private insurance broker to cover that difference. Don’t wait until you need a Medigap policy, though.
“We get people who call wanting to sign up for Medigap because they’re going to be responsible for that amount,” says Garrett Ball, a Medicare insurance broker and owner of 65Medicare.org, a private Medicare resource. “Unfortunately, that’s often not possible. There’s a Medigap enrollment period to sign up for a plan but if you don’t, it’s difficult to get later.”
4. I don’t need long-term care insurance because I have (or will have) Medicare.
Many people believe that long-term care is always covered by Medicare with just a daily copay. However, “Long-term care is not a covered benefit by Medicare,” says Tibbits. “Long-term insurance plans can be incredibly expensive but can also be very useful.” Read more about long-term care insurance here.
Find out more information about Medicare at Medicare.gov and A Place for Mom’s “Public Pay Resource Guide: Medicaid and Medicare Government Funding for Senior Housing and Care.”
What other Medicare myths have you heard? We’d like to hear from you in the comments below.
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