One time when we were taking care of my father-in-law I was explaining the costs involved in elder care, a befuddled person asked me, “Well, doesn’t Medicare cover everything?”  The short answer is that Medicare does cover a lot but it doesn’t cover everything.

Medicare has different parts.  Part A covers the hospital costs of people over 65.  It also covers people under 65 who have kidney failure.  It is paid for by contributions from employers, employees, and the self-employed and from premiums deducted from the social security payments of the person receiving the coverage.  The premiums are deducted automatically from their Social Security payment.  If your LO is not receiving Social Security there is a seven month enrollment period, three months before their 65^th birthday and four months after.  Be sure they don’t miss this enrollment period.

Medicare does not cover long term or custodial care, which is what elder care usually involves.  The services that are covered have to be prescribed by a doctor and provided by a Medicare approved facility.

Medicare Part B is paid for by the premiums of people who voluntarily enroll.  The federal government pays the rest.  Medicare Part B covers physicians’ costs, lab costs, outpatient care and certain home care services.

If your parent is covered by another form of insurance, such as a retirement program, he/she may not want to enroll in Part B.  If that is the case he/she must let Social Security know about their decision.

Medicare Part B covers 80% of the bill. The remaining 20% has to be covered with a separate insurance policy.  We used the AARP program and were very satisfied with it.  We had the premiums automatically deducted so there would be no gap in the coverage.

When buying the Medi-Gap insurance make sure that it does not exclude pre-existing conditions.  Be sure also that they buy the policy within six months of turning 65.  If you enroll during that period, the insurance company can not charge more because of any pre-existing condition.  As always, fill out the insurance application completely.  Don’t give the insurance company a reason to refuse claim.

To get more information on Medi-Gap insurance go to Medicare.gov or call your local area agency for aging.

In the next post, I’ll describe Medicare HMO’s and Medicaid.