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Deductibles, Copays Add Up

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Sep 09, 2003 (United Press International via COMTEX) -- Medicare, the government-run health insurance program providing benefits to some 40-million Americans -- including 35-million seniors -- is divided into two parts.

Part A covers inpatient hospital stays, skilled nursing facilities, hospice care and some home healthcare.

Part B covers doctors' services, outpatient hospital care and other medical services that Part A does not cover, such as physical and occupational therapy and some home healthcare when deemed medically necessary by a beneficiary's physician.

Most people pay no deductible for Part A because they or their spouse have earned the required 40-or-more quarters of Medicare-covered employment. Generally, those who do not meet that requirement pay $316 per month.

Medicare was not designed to pay the entire cost of a beneficiary's healthcare and out-of-pocket expenses can pile up quickly for those with chronic illnesses. It is estimated two-thirds of seniors on Medicare earn $20,000 or less each year.

Very-low-income Medicare beneficiaries can qualify for Medicaid, the health insurance program for the indigent run jointly by the federal government and individual states. These beneficiaries are called dual eligibles.

In Part A, the important payment trigger for Medicare is the "benefit period," which begins the day a beneficiary enters a hospital or skilled nursing facility and ends when the beneficiary has not received any hospital or skilled nursing care for 60 days in a row.

There is no limit to the number of benefit periods a person can have but after one period ends, if the senior enters the hospital again, a new benefit begins. The distinction is important because each new benefit period means a recipient is responsible for the Part A $840 deductible, which covers 60 days of inpatient care.

If the senior is hospitalized longer, from day 61 to 90 the additional out-of-pocket expense is $210 per day and rises to $420 per day for days 91-150. Beyond 150 days in the hospital, the beneficiary must pay the entire bill unless he or she has supplemental Medigap insurance coverage.

The Part B premium -- for many deducted from their Social Security or retirement pay -- is $58.70 per month in 2003. The annual deductible is $100 per year and beneficiaries must pay 20 percent of all covered services after that.

Copyright 2003 by United Press International.

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