What Is Original Medicare?

Original Medicare is a federal program that offers health insurance to United States citizens aged 65 and above, as well as younger individuals with a qualifying disability or end-stage renal (kidney) disease.  The program originally consisted of two parts: Medicare Part A and Medicare Part B.  It has since expanded, leaving Part A and Part B generally referred to as “Original Medicare”.

Original Medicare At-A-Glance:

• Medicare Part A
  • Who is eligible: U.S. citizens age 65 and older, younger people with a qualifying disability, and end-stage kidney disease patients
  • Coverage: hospital & inpatient stays, including skilled nursing facility care, hospice, and home health care
  • Deductible: $1632 per benefit period
  • Monthly Premiums: $0 if you satisfy the work requirements (most people do); premiums vary if you do not

• Medicare Part B
  • Who is eligible: U.S. citizens age 65 and older, younger people with a qualifying disability, and end-stage kidney disease patients
  • Coverage: 80% of medical services such as doctor visits, imaging, labs, outpatient surgery, ER visits, and more
  • Deductible: $240 each year
  • Monthly Premiums: $174.70 monthly (exceptions apply)
  • Other Costs: roughly 20% of Medicare-covered services remaining after Part B pays, coinsurance, copays, and possible excess charges

Medicare Part A – Hospital Insurance

Eligibility:  U.S. citizens become eligible for Medicare Part A when they reach age 65.  Individuals younger than 65 are eligible if they have received SSA or RRB disability payments for 24 months or more. Special eligibility is also extended to patients with Lou Gehrig’s disease (ALS) or end-stage renal disease (ESRD).

Coverage: Medicare Part A is referred to as hospital insurance because it covers inpatient hospital care. In general, Part A covers:

• Inpatient hospital care (including labs, testing, and some medications given during an inpatient stay)
• Skilled nursing facility care
• Hospice care
• Home health care

Deductible: The deductible for Medicare Part A is $1632 per inpatient hospital benefit period.  Benefit periods begin on the first day you are admitted to an inpatient care facility and end 60 days after discharge.  Your Part A deductible must be paid for each benefit period before Original Medicare begins to pay your inpatient hospital bills.

Premium: If you have worked and paid Medicare taxes for roughly ten years, you should qualify for premium-free Medicare Part A. If you do not qualify for premium-free Part A, you can still purchase Part A; in this case, your premium will be based on how long you or your spouse worked and paid Medicare taxes.

Medicare Part B – Medical Insurance

Eligibility: Medicare Part B has the same eligibility requirements as Part A, but you must be enrolled in Part A in order to enroll in Part B.

Coverage: Medicare Part B is referred to as medical insurance because it covers most outpatient routine care. You may see any doctor or facility that accepts Medicare payments.  Once your deductible has been met, Part B will cover roughly 80% of your covered Medicare services, including but not limited to:

• Doctor visits – primary care and specialist
• Preventive services (with limitations)
• Wellness checks
• Emergency care
• Ambulance services
• Home health care
• Clinical research
• Mental health services (inpatient, outpatient, partial hospitalization)
• Durable medical equipment
• Other services

Note: Medicare must consider all medications, medical devices, and services medically necessary to provide Medicare coverage.

Deductible: The Part B deductible for 2024 is $240.

Premium: For 2024, the Part B monthly premium is $174.70; however, this amount may be higher if you have a higher income.  Details can be found at Medicare.gov.

Other Costs: After Medicare Part B pays 80% of your covered medical expenses, you are responsible for the remaining 20% (unless you purchase a Medicare Advantage plan or Medicare Supplement plan).  You are also responsible for copays and any possible excess charges (the amount a doctor may charge above the Medicare-approved amount).

What Is Not Covered by Original Medicare?

Unfortunately, Original Medicare does not cover all out-of-pocket costs for beneficiaries.  The expenses you are responsible to pay when enrolled in Medicare Part A and Part B include:

• Part A deductible
• Part B deductible
• Part A and B coinsurance or copays
• Part B monthly premium

There are also some medical services that Original Medicare won’t cover, including but not limited to:

• Cosmetic surgery expenses
• Routine foot care
• Services delivered outside of the U.S.
• Hearing aids and required testing
• Eye exams
• Eyeglasses or contact lenses
• Dental care (exams, dentures, dental implants, etc.)
• Most prescription medications

Once you are enrolled in Original Medicare, you may also enroll in Medicare Part D if you need prescription drug coverage; however, a Part D plan will likely come with another monthly premium. Still, a Part D plan can eliminate prescription drug costs, which are one of the most significant out-of-pocket expenses left by the Original Medicare health plan.

How Original Medicare Works

Here are a few key points to remember about Original Medicare:

• Remember to select a medical provider who accepts Medicare payments for your healthcare (most providers do).  Providers agree to specific fees when they enroll in the Medicare program.  Any charges outside of Medicare-approved limits will likely be your responsibility.
• Deductibles, copayments, and coinsurance incurred with Original Medicare are your financial responsibility. Enrolling in a Medicare Supplement plan or Medicare Advantage plan (also known as a Part C plan) can help ease these costs.
• There is no limit to the out-of-pocket costs that beneficiaries may pay in a single year unless they receive a guaranteed maximum by enrolling in a Medicare Advantage plan.  A Medicare Supplement plan (Medigap) can also reduce the expenses paid out-of-pocket.  However, these plans are not required to enroll in Original Medicare.
• If you choose to enroll only in Medicare Part A and Part B, you may see any service provider in the United States that accepts Medicare as payment. Beneficiaries aren’t required to obtain referrals before seeing Medicare-approved specialists. These conditions do change, however, under Medicare Advantage or Medigap Select plans, which are facilitated by private insurance companies and usually use medical networks.
• Medicare covers most medically necessary services to diagnose and treat legitimate medical conditions.

Ready to Learn More?

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Article Resources

• What Is Original Medicare?
• Medicare Part A – Hospital Insurance
• Medicare Part B – Medical Insurance
• What Is Not Covered by Original Medicare?
• How Much Does Original Medicare Cost?