Don’t be taken in by the title of this article; we are not implying that you are a dummy in any way. In fact, we are certain that you are an intelligent and savvy individual out to make sense of a confusing and poorly documented government health insurance program. With that said, here are the basics of Medicare.
In July of 1965, the Medicare bill was signed into law, and government heath care for elderly and disabled Americans was established. There haven’t been significant changes to the program since 1965, until President Bush signed the Medicare Modernization Act of 2003. This new law added prescription drug coverage. There are now three basic parts to Medicare coverage. These parts are: Part A (hospitalization), Part B (doctor visits), and Part D (prescription drugs).
Medicare Part A
Part A of Medicare covers your inpatient hospitalization, critical access, and skilled nursing expenses. For most people there are no monthly premiums to pay; this part of the coverage is free. You will have to pay a deductible for your hospital visits. The amounts of this deductible change almost every year.
In 2006, for the first 60 days of your hospital stay, you will pay $952 to meet the Medicare deductible. After you meet this deductible, Medicare typically pays 80% of your expenses, which means you will be billed for the other 20%. If your hospital stay lasts longer than 60 days you will need to meet an additional deductible, charged each day. For days 61-90 of your hospital stay you will have to pay $238 each day to meet your deductible. For days 91-150 you will have to pay $476 each day to meet your deductible.
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