Understanding Medicare Part A made painless

Medicare is pretty straightforward. As easy as A, B, C... Or is it?

So what is it?

Medicare is a national health insurance program, now administered by the Centers for Medicaid and Medicare Services of the U.S. federal government but begun in 1966 under the Social Security Administration. United States Medicare is funded by a combination of a payroll tax, premiums and surtaxes from beneficiaries, and general revenue. It provides health insurance for Americans aged 65 and older who have worked and paid into the system through the payroll tax. Check out Wikipedia.Let us start at the top with Medicare part A. Part A covers hospital bills. It is free to you if you have worked for ten or more years in Medicare-eligible employment. Part A is mandatory.

How much do I have to pay?

Most people don't pay a monthly premium for Part A (sometimes called "premium-free Part A"). If you buy Part A, you'll pay up to $437 each month. If you paid Medicare taxes for less than 30 quarters, the standard Part A premium is $437. If you paid Medicare taxes for 30-39 quarters, the standard Part A premium is $240. For more information click this link.Part A has a deductible that you must pay before coverage kicks in. It does not offer coverage outside the US.

Part A hospital inpatient deductible and coinsurance:

You pay:$1,364 deductible for each benefit period

Days 1-60: $0 coinsurance for each benefit period

Days 61-90: $341 coinsurance per day of each benefit period

Days 91 and beyond: $682 coinsurance per each "lifetime reserve day" after day 90 for each benefit period (up to 60 days over your lifetime)

Beyond lifetime reserve days: all costs

Most people sign-up when they become eligible, which is at the age of 65. SO that is all about Medicare part A. Watch out for our post on Medicare part B!

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