Medicare and Home Health Care: The Basics

If you’re reading this, chances are that 1) you or a loved one has reached a point in his or her life where senior healthcare insurance has now become a concern, and 2) you don’t know enough—or perhaps don’t know the first thing—about Medicare and don’t know where to start. It’s okay not to know it all right away; for many folks, my own family included, Medicare is one of those things you may not pay much attention to until the day you need it.

Let’s start with some basic definitions; much of the following is from the government's own Medicare website, www.medicare.gov:

What is Medicare? Medicare is the federal health insurance program for people who are 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD).

What’s with all those different letters: Part B, Part C? It’s like a crazy alphabet soup! It’s simpler than it seems at first; each different part of Medicare helps cover separate types of services, like hospital or prescription drugs.

Medicare Part A (Hospital Insurance)

Part A covers inpatient hospital stays; care in a skilled nursing facility; hospice care, nursing home care (if custodial care isn’t the only care you need); and some home health care. You do not have to pay for a premium if:

You are 65 and you or your spouse has paid Medicare taxes for at least 10 years.
You haven’t reached age 65, but you’re disabled and you’ve been receiving Social Security benefits or Railroad Retirement Board disability benefits for two years.
You have end-stage renal disease (ESRD) and are receiving dialysis.
You have amylotrophic lateral sclerosis (ALS) and are eligible for Social Security Disability Insurance.

Home Health Care Services under Part A: What’s covered?

It is under Part A that any coverage for in-home health services can be found, and the Medicare website is very explicit about what things are and aren’t covered and under what circumstances they may be covered (for example, the patient may need to be certified as homebound and under a doctor’s care). Medicare Part A (Hospital Insurance) and/or Medicare Part B (Medical Insurance) covers eligible home health services like these:

Intermittent skilled nursing care
Physical therapy
Speech-language pathology services
Continued occupational services, and more

Medicare doesn't pay for:

24-hour-a-day care at home
Meals delivered to your home
Homemaker services
Personal care

Who is eligible?

You must be under the care of a doctor, and you must be getting services under a plan of care established and reviewed regularly by a doctor.

You must need, and a doctor must certify that you need, one or more of these:

Intermittent skilled nursing care (other than just drawing blood)
Physical therapy, speech-language pathology, or continued occupational therapy services: These services are covered only when the services are specific, safe and an effective treatment for your condition. The amount, frequency and time period of the services needs to be reasonable, and they need to be complex or only qualified therapists can do them safely and effectively. To be eligible, either: 1) your condition must be expected to improve in a reasonable and generally-predictable period of time, or 2) you need a skilled therapist to safely and effectively make a maintenance program for your condition, or 3) you need a skilled therapist to safely and effectively do maintenance therapy for your condition.
The home health agency caring for you must be Medicare-certified. [HISC is.]
You must be homebound, and a doctor must certify that you're homebound.

You're not eligible for the home health benefit if you need more than part-time or "intermittent" skilled nursing care. You may leave home for medical treatment or short, infrequent absences for non-medical reasons, like attending religious services. You can still get home health care if you attend adult day care.

Note: Home health services may also include medical social services, part-time or intermittent home health aide services, medical supplies for use at home, durable medical equipment, or injectable osteoporosis drugs.

Medicare Part B (Medical Insurance)

Part B covers certain doctors' services, outpatient care, medical supplies, and preventive services. You must have Part A to sign up for Part B. Part B is a voluntary program which requires the payment of a monthly premium for all months of coverage. You pay nothing for most preventive services if you get the services from a health care provider who accepts assignment.

Part B covers Medically-necessary services, services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice; and Preventive services, health care to prevent illness (like the flu) or detect it at an early stage, when treatment is most likely to work best.

Part B covers things like:

Clinical research
Ambulance services
Durable medical equipment (DME)
Mental health
Inpatient
Outpatient
Partial hospitalization
Getting a second opinion before surgery
Limited outpatient prescription drugs

Individuals who are eligible for premium-free Part A are also eligible for enroll in Part B once they are entitled to Part A. Enrollment in Part B can only happen at certain times. Individuals who must pay a premium for Part A must meet the following requirements to enroll in Part B:

Be age 65 or older;
Be a U.S. resident; AND
Be either a U.S. citizen, OR
Be an alien who has been lawfully admitted for permanent residence and has been residing in the United States for 5 continuous years prior to the month of filing an application for Medicare.

Most folks who have Medicare have Part A and/or Part B; together, those two parts are often referred to as “Original Medicare.”

Medicare Part C (Medicare Advantage Plans)*

Part C is a type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits. Medicare Advantage Plans are usually HMOs (Health Maintenance Organizations) or PPOs (Preferred Provider Organizations), but can also be Private Fee-for-Service Plans, Special Needs Plans, or Medicare Medical Savings Account Plans. If you’re enrolled in a Medicare Advantage Plan, most Medicare services are covered through that plan and not paid for under Original Medicare. Most Medicare Advantage Plans also offer prescription drug coverage. Even with a Part C Medicare Advantage Plan, hospice care is still covered under Part A.

Medicare Part D (prescription drug coverage)*

Part D adds prescription drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private-Fee-for-Service Plans, and Medicare Medical Savings Account Plans. These plans are offered by insurance companies and other private companies approved by Medicare. Medicare Advantage Plans may also offer prescription drug coverage that follows the same rules as Medicare Prescription Drug Plans.

Now that you know the different parts, how do you know what part you are already eligible for, or if you should consider other parts, too?

If you’re 65 or older and already receiving benefits like Social Security; are under 65 and disabled; or have ALS, for example, you may automatically get Part A and/or Part B. If you are automatically enrolled because of these factors, you'll get a red, white, and blue Medicare card in the mail 3 months before your 65th birthday or your 25th month of disability that says right on it what Parts you are currently enrolled for.

If you aren’t automatically enrolled (maybe you’re still working), you would need to sign up for Part A and/or Part B; the eligibility window for signing up is 7 months. For example, if your eligibility begins when you turn 65, your signup widow begins 3 months before your 65th birthday, includes your birthday month, and ends three months after you turn 65. If you don’t sign up when you first become eligible, there is an open signup period each year from January 1—March 31, but signing up outside of your initial eligibility window can result in late enrollment penalties, and for Part B, those continue for as long as you have Part B, which can increase your out-of-pocket expenses, and could potentially lead to coverage gaps.

What is Medigap Insurance?

A Medicare Supplement Insurance (Medigap) policy, sold by private companies, can help pay some of the health care costs that Original Medicare doesn't cover, like copayments, coinsurance, and deductibles. Some Medigap policies also offer coverage for services that Original Medicare doesn't cover, like medical care when you travel outside the U.S. If you have Original Medicare and you buy a Medigap policy, Medicare will pay its share of the Medicare-approved amount for covered health care costs. Then your Medigap policy pays its share. A Medigap policy is different from a Medicare Advantage Plan. Those plans are ways to get Medicare benefits, while a Medigap policy only supplements your Original Medicare benefits.