What is Medicare?

Medicare is our country’s health insurance program for people age 65 or older. Certain people younger than age 65 can qualify for Medicare, too, including those who have disabilities and those who have permanent kidney failure. The program helps with the cost of health care, but it does not cover all medical expenses or the cost of most long-term care.

Medicare is financed by a portion of the payroll taxes paid by workers and their employers. It also is financed in part by monthly premiums deducted from Social Security checks.

The Centers for Medicare & Medicaid Services is the agency in charge of the Medicare program www.medicare.gov.

Medicare has two parts to help pay for different kinds of health care costs:


  1. Hospital insurance (Part A) – This helps cover your short-term inpatient care in a hospital or skilled nursing facility. It also helps cover some health care and hospice care.
    • Most people don’t pay a premium for Part A because they or their spouse already paid for it through payroll taxes while working.
  2. Medical Insurance (Part B) – This helps cover your doctors’ services and many other medical services and supplies that are not covered by hospital insurance (wheelchairs, walkers, oxygen, etc.) The Medicare Part B monthly premium will be $88.50 in 2006, an increase of $10.30 from the current $78.20 premium.

Though premiums are rising, most Medicare beneficiaries will see significantly lower out-of-pocket health care costs in 2006 because of the savings in drug costs from the new Medicare prescription drug benefit.

Medicare coverage options

You can get your Medicare health care and prescription drug coverage in different ways:

  • The Original Medicare Plan – This is a fee-for-service plan, managed by the Federal Government, that covers many health care services and certain drugs. You can go to any doctor or hospital that accepts Medicare.
    • Medigap policies are supplemental policies that you can purchase to cover “gaps” in the Original Medicare Plan (deductibles, co-payments, co-insurance).
  • Medicare Advantage Plans – These plans, which include Health Maintenance Organization Plans (HMOs), Preferred Provider Organization Plans (PPOs) and Private Fee-for-Service (PFFS) Plans, generally offer extra benefits, more services and lower co-payments. However, in some plans (HMOs) you may only be able to see certain doctors or go to certain hospitals.

Call Medicare Oklahoma at (405)607-0058 to learn more about your options for Medicare “Part D” prescription drug coverage.