Jan 04, 2009
And you thought it was free! Well, don’t feel bad—so did we.

In point of fact, it is likely your Medicare-based health coverage, in the absence of the passage of a universal health care plan similar to the bill currently before the House (H.R. 676), will cost you close to the amount you will be receiving from your Social Security benefits.

Medicare is divided into three parts:

Part A is for hospital insurance. It covers hospitalizations, skilled nursing facilities (a nursing home), and some home health care. Part A will be without cost for most Medicare beneficiaries (those with 40 or more quarters—ten years—of Medicare-covered employment, or a spouse with same), unless you actually need to use the service, in which case you will have to pay a $1,068 deductible for a hospital stay of 1-60 days. If you need to stay in a hospital longer than that, well, don’t ask. Additionally, without those 40 quarters of employment, your out-of-pocket cost for Part A (before the deductible) can be as high as $5,316 per year.¹

Part B is for medical insurance. This covers physician services, outpatient hospital services, certain home health services, and durable medical equipment. In 2009, this will cost all Medicare beneficiaries $1,156.80. Again, if you actually need to see a doctor during this time, you will have a $135.00 deductible and, after that is expended, you will be liable for 20 percent of the cost of any additional Medicare-approved services.

Typically, according to a knowledgeable friend of ours with long experience in the health field, people purchase supplemental insurance to cover the Part A deductible and Part B deductible and 20 percent co-pay, at a cost of $3,000 to $4,000 per year.

Then comes Part D, the unkindest cut of all. Part D is for medications, and one has to go shopping for plans from various providers for Part D—back into the kindly hands of private insurance companies.² In our sparsely populated, rural Vermont area, there are 47 contenders in the “Prescription Drug Plan” category and 9 in the “Medicare Health Plan Category” (we have yet to determine the difference). The 56 plans all have different combinations of monthly premiums, annual deductibles, and co-pays (what they call Drug Cost Sharing). Monthly premiums range from nothing to $111.40; annual deductibles from nothing to $295; and co-pays appear to be about 25 to 33 percent of the cost of the medications. But wait! The complication doesn’t end there. We mustn’t forget “The Gap.”

The costs above only pertain to the first $2,700 in medications you receive during a calendar year. Once you have reached that limit, you fall into the Gap and are responsible for the entire cost of the next $4,350 of your medications in that year, during which time you must continue to pay the monthly premium!

As with Parts A and B, there are numerous insurance companies eager to sell you policies to supplement possible expenses beyond the basic plan you select, although co-pays will probably still be required.

So there it is. The free government-sponsored Medicare you have been paying into during your working life, the benefits of which you have been looking forward to reaping upon a well-earned retirement, is going to cost you your Social Security check, deluge you in paperwork, torment you with multiple plans to select from (with a hefty penalty for dilly-dallying³), and altogether threaten to turn your golden years into dross.

Read H.R. 676 (linked above). It only takes a few minutes. It promises a universal health care system properly funded and administered for the benefit of the people rather than the corporations or the bureaucrats. If your representative is a co-sponsor (find out here), write them and tell them you are grateful for their support of this initiative. If they aren’t, write them and encourage them to get on board.

Single-payer, universal health care is a cherished right throughout the civilized world—except in the U.S. Bring it home in 2009!
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¹ Medicare: The Official U.S. Government Site for People with Medicare (accessed, as all footnotes in this entry, January 1, 2009)
² Medicare Prescription Drug Plan Finder
³ The New Medicare Part D and Its Penalties
tags: Health | Governance