Check Your Medical RecordsMedicare-speak can be very confusing. To help you understand Medicare jargon, listed below are some of the common terms and definitions used by Medicare and Medicare medical providers.

Benefit period
In original Medicare, the Part A benefit period for hospitals and skilled nursing facility begins the day you’re admitted as an inpatient to a hospital or skilled nursing facility. The benefit period ends when you haven’t received any inpatient hospital care or care in a skilled nursing facility for 60 days in a row. If you go into a hospital or a skilled nursing period after a benefit period has ended, a new benefit period begins. You must pay the inpatient hospital deductible for each benefit period. There is no limit to the number of benefit periods.

An amount you are required to pay as your share of the cost for services or supplies. Coinsurance is usually a percentage of the entire cost rather than a set dollar amount. An example would be Medicare Part B. Medicare pays 80% and you or your Medicare plan are responsible for the other 20%.

Co-pay or Copayment
A copayment is similar to coinsurance but is a set dollar amount rather than a percentage. For example, you might pay $10 or $20 copayment each time you visit the doctor’s office.

Coordination of benefits
Medicare’s way to determine who pays first when two or more health insurance plans are responsible for paying the same medical claim.

Coverage gap or donut hole (Medicare prescription drug plan)
The “donut hole” starts when you and your plan have paid a specified dollar amount for prescription drugs during that year. When you reach that specified point, you will pay a higher cost-sharing percentage for prescription drugs until you spend enough to qualify for catastrophic coverage.

Creditable prescription drug coverage
Prescription drug coverage from an employer, union, or VA that pays, on average, at least as much as Medicare standard prescription drug coverage. People who have this kind of coverage when they become eligible for Medicare can generally keep that coverage without paying a penalty if they decide to enroll in Medicare prescription drug coverage later.

The amount you must pay for health care or prescriptions before Original Medicare, your prescription drug plan, or other insurance begins to pay.

Durable Medical Equipment
Equipment such as blood test strips, hospital beds, canes, and wheelchairs that your doctor prescribes for use in your home

Formulary (Medicare prescription drug plan)
A plan’s formulary is a list of prescription drugs covered by a drug plan. Currently, there are over 20 prescription drug plans in Colorado and each plan may have a different formulary.

Health care you receive when you are admitted by a doctor’s order to a healthcare facility, like a hospital or skilled nursing facility.

Medigap/Medicare Supplements
Two different names for the same thing. Medicare Supplement plans/Medigap plan are standardized plans to cover the gaps (coinsurance, copayments, and deductibles) in Original Medicare.

Out-of-pocket costs
Health or prescription drug costs that you must pay on your own when they are not covered by Medicare or other insurance.

Medical or surgical care you get from a hospital when you’re not admitted as an inpatient. Outpatient hospital care can include emergency services, observation services, outpatient surgery, X-rays, and lab tests. You can be considered an outpatient even if you spend the night at the hospital.

Tiers (Medicare prescription drug plan)
Drug companies break down their list of covered drugs in the formulary into different tiers. In most cases, drugs listed in smaller-numbered tiers will cost less than drugs listed in higher-numbered tiers. Tiers 1 & 2 are generally generic drug and Tiers 3, 4, and 5 are preferred brand and specialty drugs. Each drug plan may place its covered drugs into different tiers that is why it is important to review your drug plan during Open Enrollment (October 15 to Dec 7) 

For a complete listing of all Medicare, definition click here.

Medicare can be confusing. We will provide you with the information you need to make an informed decision and help you find the plan that will fit your budget and meets your unique needs.

We make the complex simple by shopping the plans and rates for you. There is never a fee and you are under no obligation to use my services.

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Medicare Explained in Plain English