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IN THIS CHAPTER

Getting a handle on the coverage you get under Medicare Part A and Part B

Figuring out what Medicare Part D covers

Being aware of what Medicare doesn’t cover

Recognizing that some coverage comes with limits

Medicare is huge – a program of Titanic proportions. It covers so many medical services that just to list them all would fill this entire book. And describing each service or item in detail – in terms of the coverage requirements or limitations that apply in different circumstances – would take several books. So I need to use a big brush here.

In this chapter, I broadly paint in the categories of care that Medicare pays for under Part A, Part B, and Part D so that you get a good idea of its scope. (The Medicare Advantage program gets its own explanation in Chapters 1, 9, and 11.) I also explain some types of care that you may expect to be covered by Medicare but that actually aren’t. And finally, I show that a few services come with limitations on coverage, meaning that Medicare helps pay for them only up to a certain point in a particular period of time.

Note: I’m not skimping on giving more-detailed information that you need to know in order to deal with certain aspects of Medicare. Some coverage issues are very straightforward – basically, you just show your Medicare card (or Medicare Advantage plan card or Part D drug plan card, as appropriate) to get a covered service for the required co-pay or, in some cases, for free. But other issues are more complex and may pose pitfalls that can trip you up if you’re not expecting them. I zoom in on those issues in Chapter 14, where I share the inside scoop on some of the finer points of Medicare coverage that are good to know about in advance so you don’t have to find out the hard way.

Understanding What Part A and Part B Cover

Part A and Part B form the core of Medicare. They provide the coverage that you have if you enroll in the traditional or original Medicare program that has been around since 1966, although many more services have been added since then. Parts A and B are also the basis of your coverage if you’re in a Medicare Advantage health plan, because all those plans must by law cover the same services as the traditional program, although the plans can provide extra benefits if they want to. (I go into detail about the differences between traditional Medicare and Medicare Advantage plans in Chapter 9.)

These two parts of Medicare cover entirely different services, as explained in Chapter 1. But sometimes Parts A and B work in tandem. For example, if you need to go into the hospital, in most cases Part A covers the cost of your room, meals, and nursing care after you’ve met the deductible. But Part B covers the cost of your medical treatment – services provided by surgeons, other doctors, and anesthetists. This division of coverage also applies to staying in a skilled nursing facility for continuing care after leaving the hospital, using home health services, and receiving hospice care.

In the following sections, I describe broad categories of services that Parts A and B pay for.

Necessary medical care

In essence, Medicare covers services that are reasonable or necessary to save life and maintain or improve health. That includes really big-ticket items – such as transplants of the heart and other organs, delicate surgery to repair severe injuries, cancer treatments, and many others – that cost Medicare tens of thousands, and in some cases hundreds of thousands, of dollars. The program also, of course, covers more-routine and less-expensive services, from allergy shots to X-rays.

No doubt about it: Medicare can split hairs. It may cover a service in some circumstances but not others. One glaring example of this discrepancy is that Medicare covers powered wheelchairs (as opposed to the conventional type) only if you need one to get around inside your home but not if you need one just to be mobile outdoors. Medicare may also cover a treatment in some parts of the country but not everywhere. (I go into the difference between national coverage determinations, which cover people in need of them throughout the country, and other coverage determinations that are made regionally, in Chapter 14.) But on the whole, Medicare pays for a vast range of medical services that people need.

I sometimes hear from people who’ve used a lot of services, or a few really expensive ones, and are scared to death that their Medicare coverage is going to “run out.” This isn’t something to worry about. In general, no limit caps the amount of coverage you can get from Medicare for necessary services – except for a few specific situations that I explore later in this chapter.

Preventive care

Being able to treat a medical problem is good, but dodging it altogether is better! These days, that seems an obvious truth. Yet Medicare has only fairly recently expanded coverage for services that help prevent or stave off some of the diseases that make people very ill and – not coincidentally – cost Medicare mountains of money. Even better: Many of these preventive tests, screenings, and counseling sessions now come free (no co-pays or deductibles) thanks to the 2010 Affordable Care Act. More than 60 million people with Medicare took advantage of these services, at no cost to themselves, during the first three years after they became free on January 1, 2011, according to government reports.

But to get these services for free, you need to see a doctor who accepts assignment – meaning that she has agreed to accept the Medicare-approved amount as full payment for any service provided to a Medicare patient. (I go into detail about what Medicare doctors can charge in Chapter 13.) Otherwise, you have to pony up a co-pay or, in some circumstances, even the full cost.

Now take a look at Table 2-1, which shows the range of preventive tests, screenings, and counseling sessions that Medicare covers under Part B and whether they cost you anything. It’s a pretty impressive list!

TABLE 2-1 Preventive Care Services Medicare Covers

Source: Centers for Medicare & Medicaid Services

Note: Services labeled “free” (meaning no co-pay or deductible required) assume that you go to a doctor who accepts Medicare’s payment in full.

Specialized care in certain circumstances

Medicare Part A is usually associated with care within the hospital, of course. But it also covers certain specialized services outside the hospital, most of which focus on nursing. The following sections provide a quick overview.

Care in a skilled nursing facility

Say you’ve been in the hospital and are being discharged but still need more-specialized nursing care than you can receive at home – physical therapy to help you walk again after a hip replacement, speech therapy after a stroke, a continuing need for intravenous fluids, or wound care. Medicare covers this type of ongoing care under Part A, usually at what’s called a skilled nursing facility – most often a nursing home – under certain conditions.

The most important condition for Medicare coverage of care in a skilled nursing facility is that you must have been in the hospital as a formally admitted patient for at least three days. (This three-day rule conceals a hidden pitfall – situations where the hospital places you under “observation” – that you really need to know about; see Chapter 14.) A doctor must order the services that you need from professionals such as registered nurses and qualified physical therapists and speech or hearing pathologists. And the skilled nursing facility you go to must be one that Medicare has approved.

Traditional Medicare covers stays in a skilled nursing facility for up to 100 days in a benefit period. The first 20 days cost you nothing; from day 21 through day 100, you pay a daily co-pay, which goes up slightly every year. (In 2015, the co-pay was $157.50 a day.) Some Medigap supplemental insurance policies cover these co-pays 100 percent. (Head to Chapter 4 for details about Medigap insurance.) If you’re enrolled in a Medicare Advantage health plan, look at your coverage documents or call your plan to find out what it charges for stays in skilled nursing facilities.

For more information, check out the official publication “Medicare Coverage of Skilled Nursing Facility Care” at www.medicare.gov/Pubs/pdf/10153.pdf.

Home health care services

These services provide some of the same types of care that you may get in a skilled nursing facility but bring them to you in your own home. They include

❯❯ Skilled nursing care provided on a part-time basis (no more than eight hours a day over a period of 21 days or less) and including services such as injections, feeding through a tube, and changing catheters and wound dressings.

❯❯ Physical, speech, and occupational therapy from professional therapists to help you walk again, overcome problems in talking, or regain the ability to perform everyday tasks, such as feeding and dressing yourself – whichever your medical condition requires.

❯❯ Help from home health aides in personal activities such as going to the bathroom, bathing, dressing, or preparing a light meal if these are necessary in relation to your illness or injury. (But if this personal care is the only kind of care you need, you don’t qualify for home health coverage.)

❯❯ Medical supplies such as catheters and wound dressings.

❯❯ Medical social services such as counseling for social or emotional concerns related to your illness or injury and help finding community resources if you need it.

Medicare covers all these services in full by paying a home health agency a single payment to provide them for 60 days at a time. Home health care is a valuable benefit, but the rules for qualifying are pretty strict. To get Medicare coverage, you must meet all these conditions:

❯❯ You must be homebound – that is, unable to leave home without considerable effort, unaided, or at all.

❯❯ A doctor must certify that you need one or more of the professional services in the preceding list (skilled nursing, physical or occupational therapy, or speech pathology).

❯❯ You must be under a plan of care established and regularly reviewed by a doctor.

❯❯ The home health agency caring for you must be approved by Medicare.

If you qualify, the agency must provide all the services specified in the doctor’s plan of care for you. But if you need (or ask for) an item or service that Medicare doesn’t cover, the agency must tell you so in advance and explain what it would cost you. If you need medical equipment, such as a wheelchair or a walker, while receiving home health care, you may get it through the agency, but you pay the normal 20-percent co-pay (as explained later in this chapter) unless you have Medigap insurance that covers that cost.

For more details on the home health benefit and how to choose and evaluate a home health agency, see the official publication “Medicare and Home Health Care” at www.medicare.gov/Pubs/pdf/10969.pdf.

Hospice care

There may come a time when a treatment intended to cure a serious illness stops working effectively or is more than the patient can bear. Hospice care offers an alternative in the last days or months of life. It focuses not on trying to cure the disease but on providing as much comfort as possible – medical, social, emotional, and spiritual – during the time left.

Medicare began covering hospice care in 1983, and it’s one of the most generous benefits that the program provides – at little cost to terminally ill patients or their caregivers. Patients who choose hospice care are offered a full range of medical and support services, most often in their own homes. It also allows them to be cared for temporarily in an inpatient facility, such as a hospital or nursing home, if their regular caregivers need a break.

To qualify for the hospice benefit, you must meet all these conditions:

❯❯ You must choose to receive hospice care and give up treatments intended to cure your terminal illness.

❯❯ Your doctor and the medical director of a hospice program must certify that you probably have less than six months to live.

❯❯ You must enroll in a hospice program that Medicare has approved.

❯❯ You must have Medicare Part A hospital insurance.

If you qualify, Medicare pays in full – 100 percent – for a wide range of services, including

❯❯ Medical and nursing care, plus round-the-clock on-call support

❯❯ Medical equipment and supplies

❯❯ Homemaker and home health care services

❯❯ Physical therapy

❯❯ Social worker services and dietary counseling

❯❯ Support for your caregiver

❯❯ Grief and loss counseling for you and your family

Your share of the cost is limited to a maximum of $5 per prescription for drugs used to control the symptoms and pain of your terminal illness; and 5 percent of the cost of respite care if you’re taken into a nursing home to give your caregiver a break. However, if you have Medigap supplemental insurance, both these costs are fully covered, as Chapter 4 explains. (Costs related to any medical conditions other than your terminal illness are covered by Medicare Part B or Part D in the usual way.)

You’re free to stop hospice care any time you want to – and also to resume it again if that’s your wish. Coverage continues for as long as your doctor and a hospice doctor continue to certify that you’re terminally ill, even if you live longer than six months. If your health improves and the doctors decide you no longer need hospice care, the benefit ends – though you still have the right to appeal. If your health deteriorates again, the benefit can resume.

For more details, see the official publication “Medicare Hospice Benefits” at www.medicare.gov/Pubs/pdf/02154.pdf.

Pregnancy and childbirth

Medicare does indeed cover pregnancy and childbirth. Are you astonished? That’s probably because you see Medicare as a program only for people way past childbearing age. But of course Medicare is also for much younger people who qualify through disability, and some of them become pregnant.

The relevant regulation in the Medicare Benefit Policy Manual explains the scope of coverage: “Skilled medical management is appropriate throughout the events of pregnancy, beginning with the diagnosis of the condition, continuing through delivery, and ending after the necessary postnatal care.” Medicare also helps cover the cost of treatment for miscarriages, and for abortions in circumstances where pregnancy is the result of incest or rape or would threaten your life if you went to term. It doesn’t cover elective abortion if you choose to terminate your pregnancy.

To receive hospital services, you need Part A hospital insurance. For doctors’ services and outpatient procedures (such as lab tests), you need Part B coverage. If you’re enrolled in Medicaid because your income is low, that program may pay some or all of your out-of-pocket Medicare costs, depending on your state’s eligibility rules. Medicaid may also pay for your infant’s medical care. But after the birth, Medicare doesn’t cover services for your baby at all.

Medical supplies and equipment

What if you need a wheelchair, an artificial limb, an oxygen tank, or other items that help you function but really qualify as things rather than services or treatments? Medicare has a suitably bureaucratic name for these things – durable medical equipment – and its meaning is precise. Durable means long-lasting, and Medicare covers only items that will stick around a while. With only a few exceptions, it doesn’t cover disposable items that you use once or twice and then throw away.

To get Medicare coverage for durable medical equipment, it must be

❯❯ Medically necessary for you, not just convenient

❯❯ Prescribed by a doctor or another primary care professional

❯❯ Not easily used by anyone who isn’t ill or injured

❯❯ Reusable and likely to last for three years or more

❯❯ Appropriate for use within the home

❯❯ Provided by suppliers that Medicare has approved

Durable equipment that Medicare covers includes walkers and crutches; scooters and manual and powered wheelchairs; commode chairs; hospital beds; respiratory assistance devices; pacemakers; artificial limbs and eyes (prosthetics); limb, neck, and back braces (orthotics); and many other items. Medicare also covers some supplies, such as diabetic test strips and lancets, but not disposable items, such as catheters and diapers.

For some items – such as oxygen equipment or seat lifts that help incapacitated people get into or out of a chair – Medicare requires a doctor to fill out and sign a Certificate of Medical Necessity; without it, Medicare will deny coverage. In fact, to combat fraud and manage resources, Medicare is very picky about the evidence it requires for coverage – but your doctor and the supplier (not you) are responsible for providing this proof.

Medical equipment is most often rented, but some items may be purchased. In either case, Medicare Part B pays 80 percent, and you pay the remaining 20 percent (unless you have Medigap insurance that covers your share). That’s the breakdown in traditional Medicare if you use a supplier that accepts the Medicare-approved amount as full payment. Otherwise, you pay whatever the supplier asks. If you’re in a Medicare Advantage plan, coverage is the same, but you may have different co-pays; check with your plan for details.

For more information, and to find out how to select an approved supplier, see the official publication “Medicare Coverage of Durable Medical Equipment and Other Devices” at www.medicare.gov/Pubs/pdf/11045.pdf.

Knowing What Part D Covers

Part D, Medicare’s program for covering prescription drugs, is a complicated benefit that resembles no other type of drug coverage ever devised. That’s why understanding how it works before plunging in is really important. This section focuses on the peculiarities of Part D coverage – how it can fluctuate during the year, how different plans have their own lists of drugs they cover, and which drugs are excluded from Part D and which must be covered.

Making sense of drug coverage that can vary throughout the year

It sounds crazy, but you may find yourself paying different amounts for the same medicines at different times of the year. That’s because Part D drug coverage is generally divided into four phases over the course of a calendar year. Whether you encounter only one phase or two, three, or all four depends mainly on the cost of the prescription drugs you take during the year – unless you qualify for Extra Help (see Chapter 4). Here’s the breakdown:

❯❯ Phase 1, the annual deductible: If your Part D drug plan has a deductible, you must pay full price for your drugs until the cost reaches a limit set by law ($320 in 2015; $360 in 2016) and drug coverage actually begins. Many plans don’t charge deductibles or charge less than the limit. But if your plan has a deductible, this period begins on January 1 or whenever you start using your Medicare drug coverage.

❯❯ Phase 2, the initial coverage period: This stage begins when you’ve met any plan deductible. Otherwise, it begins on January 1 or whenever you start using Medicare drug coverage. You then pay the co-payments required by your plan for each prescription, and the plan pays the rest. This period ends when the total cost of your drugs – what you’ve paid plus what your plan has paid – reaches a certain dollar limit set in law ($2,960 in 2015; $3,310 in 2016).

❯❯ Phase 3, the coverage gap: This gap – often called the doughnut hole – begins when you hit the limit of initial coverage and ends if and when the amount you’ve spent out-of-pocket on drugs from the beginning of the year hits another dollar limit set in law ($4,700 in 2015; $4,850 in 2016).

Until 2011, you would’ve had to pay 100 percent of the cost of your drugs in the gap. Now you pay a lot less because under the Affordable Care Act, the gap is gradually shrinking. In 2015 and 2016, you get a discount of 55 percent on brand-name drugs in the gap. For generic drugs, you get a discount of 35 percent in 2015 and 42 percent in 2016. These discounts, which come partly from the drug manufacturers and partly from the government, get larger until by 2020, you pay no more than 25 percent of the cost of any drugs in the gap. What’s more, the manufacturers’ discounts on brand-name drugs count toward the dollar out-of-pocket limit that gets you out of the gap; that is, you get credit for having paid full price even though you’re receiving the discount. But for any discounts funded by the government, such as those for all generic drugs, only what you pay counts toward getting out of the gap. (I explain the gap in more detail in Chapter 14.)

❯❯ Phase 4, catastrophic coverage: If your drug costs are high enough to take you through the gap, coverage kicks in again. At this point, your share of the costs drops sharply. You pay no more than 5 percent of the price of each prescription. Catastrophic coverage ends on December 31. The next day, January 1, you return to Phase 1 (or Phase 2 if your plan has no deductible), and the whole cycle starts over again.

Figure 2-1 is a quick way of looking at the same cycle of coverage.

© John Wiley & Sons, Inc.

FIGURE 2-1: Phases of Part D drug coverage and dollar limits.

Figure 2-2 shows this information in a different way. Here, you can see examples of brand-name drugs costing (for the sake of simplicity) $100, $200, or $300 per one-month prescription – and what you’d pay for them in each phase of coverage. These examples assume co-pays during the initial coverage period of $45 for each prescription, although co-pays vary widely among Part D plans.

© John Wiley & Sons, Inc.

FIGURE 2-2: Examples of costs through four phases of coverage.

Finding out about formularies

Formulary is jargon that becomes familiar when you’re in Part D because it directly affects what you pay. A formulary is simply the list of drugs that each Part D plan decides to cover. (No national formulary exists.) Here’s why it’s important that your drugs are included on your plan’s formulary:

❯❯ You usually have to pay the whole tab for drugs that aren’t covered. Your plan pays its share of the cost during the initial and catastrophic coverage phases (Phases 2 and 4). But for any drug the plan doesn’t cover, you pay full price in all phases of coverage unless you win an exception from the plan. (I explain about coverage exceptions in Chapter 14.) The difference in your out-of-pocket expenses between a covered and uncovered drug can be hundreds of dollars a month.

❯❯ You don’t get doughnut hole credit for uncovered drugs. If you fall into the doughnut hole (Phase 3), the cost of any drugs not covered by your plan doesn’t count toward the out-of-pocket limit that gets you out of the gap and triggers low-cost catastrophic coverage.

❯❯ You’re more likely to properly fill and take your medicines. You need the meds you’re prescribed for the sake of your health. If you get coverage for them and don’t have to pay full price, you’re much more likely to fill all your prescriptions and not skip doses.

No Part D plan covers all prescription drugs, and the number covered varies greatly among plans. In 2015, the percentage of drugs that are covered ranges from 50 to 68 percent among the ten Part D plans with the most people enrolled, according to an analysis by the health research group Avalere Health. So the goal is to choose a plan that covers all, or at least most, of the specific drugs you take. I describe a strategy for doing so in Chapter 10.

In the following sections, I note the drugs that Part D has to cover and the ones that it doesn’t pay for.

Laying out the drugs Part D plans must cover

Although Medicare law doesn’t require Part D plans to cover every drug, it does insist that each plan covers at least two drugs in each class of medications. A class means all the similar drugs that are used to treat the same medical condition. Many plans cover more than two in each class. But every plan must cover “all or substantially all” drugs in each of the following six classes:

❯❯ Anticancer drugs (used to halt or slow the growth of cancers)

❯❯ Anticonvulsants (used mainly to prevent epileptic seizures)

❯❯ Antidepressants (used to counteract depression and anxiety disorders)

❯❯ Antipsychotics (used to treat mental illnesses such as schizophrenia, mania, bipolar disorder, and other delusional conditions)

❯❯ HIV/AIDS drugs (used to block or slow HIV infection and treat symptoms and side effects)

❯❯ Immunosuppressants (used to prevent rejection of transplanted organs and tissues and treat immune system disorders and some inflammatory diseases)

Medicare requires every Part D plan to cover pretty much all drugs in these categories because of the clinical problems that can occur when patients abruptly stop taking such medications or switch to others.

Recognizing the drugs Medicare doesn’t pay for

By law, Medicare doesn’t pay for certain kinds of drugs. Part D plans aren’t prohibited from covering them; Medicare just doesn’t reimburse their cost. So although a few plans may cover some of these drugs, most plans don’t cover any. The types of excluded drugs are

❯❯ Medicines sold over the counter (not needing a doctor’s prescription)

❯❯ Drugs used for anorexia, weight loss, or weight gain

❯❯ Drugs used for cosmetic reasons and hair growth

❯❯ Drugs used to promote fertility

❯❯ Drugs used to treat sexual or erectile dysfunction

❯❯ Medicines used to treat cough or cold symptoms

❯❯ Prescription vitamins and mineral products

Sometimes Medicare will pay for medications in these categories if they’re used for a “medically acceptable” purpose – for example, cough medicines when prescribed by a doctor to alleviate medical conditions such as asthma, drugs for impotency when prescribed to treat different medical conditions that affect veins and arteries, or antismoking drugs if prescribed by a doctor rather than bought over the counter.

Until 2013, Medicare also excluded barbiturates (used for anxiety and seizures) and benzodiazepines (used for anxiety and sleeping problems) because these drugs are often abused. But the ban has now been lifted wholly on benzodiazepines. And Part D coverage for barbiturates is allowed when prescribed to treat epilepsy, cancer, or chronic mental disorders.

Determining when drugs are covered by Part A, Part B, or Part D

As confusing as it sounds, some medications may be covered not only under Medicare Part D but also under Part A or Part B. Sometimes an identical drug may be covered by all three but charged under one or another according to different circumstances. That’s because certain drugs were covered under A or B before D came into existence, and that practice continued. Here’s the general rule of thumb:

❯❯ Part A covers drugs administered when you’re a patient in the hospital or a skilled nursing facility.

❯❯ Part B covers drugs administered in a doctor’s office (such as injected chemotherapy drugs), hospital outpatient departments, and, in some circumstances, by a hospice or home health care professional.

❯❯ Part D covers outpatient drugs that you administer to yourself, a caregiver administers to you at your home, or you receive if you live in a nursing home. (These drugs are usually pills but also include self-injected insulin for diabetes, for example.)

These general rules are more complicated in some situations. For example, if your organ transplant was covered by Medicare, the immunosuppressant drugs you need afterward are covered by Part B. But if your transplant surgery wasn’t covered by Medicare (perhaps because you had it before joining the program), the drugs are covered under Part D.

Part D doesn’t pay for drugs covered by Parts A or B. So if any of your meds are in question, your Part D plan may require information from you and your doctor – usually concerning any related medical treatment, such as surgery – before covering them. For this reason, Part D plans often place a prior authorization restriction on such drugs to determine whether Part A, B, or D should cover them. Your doctor may be able to settle this matter over the phone or may help you file a speedy exception request, as explained in Chapter 14. Either way, your doctor needs to explain why a prior authorization shouldn’t apply in this case.

The Gaps: Discovering What Medicare Doesn’t Cover

Although Medicare covers a multitude of medical services, it also has some yawning gaps. Some may surprise you, so the following sections address the broad areas that Medicare doesn’t normally cover, together with some tips for alternative ways of filling in the gaps. Being aware of them from the start is better than being disappointed if Medicare denies coverage after the fact.

Routine hearing, vision, dental, and foot care

The older you get, the more you’re likely to need professional attention for your ears, eyes, teeth, and feet. But Medicare doesn’t cover routine services to take care of these parts. Routine is the key word here. Medicare pays to treat problems it considers medically necessary (including cataract surgery, jaw restoration after injury, and treatment for diseases of the ear) but not the kind of care you may need on a regular basis, such as the following:

❯❯ Ear exams, hearing aids, or having hearing aids fitted

❯❯ Vision tests, eyeglasses, or contact lenses

❯❯ Oral exams, teeth cleaning, extractions, or dentures

❯❯ Toenail clipping or the removal of corns and calluses

However, routine services for ears, eyes, and teeth may be covered if you’re enrolled in a Medicare Advantage plan that provides them as extra benefits. Some plans offer them as separate benefit packages for an additional premium. Not all plans offer coverage for this routine care, but those that do are identified in the plan finder program on Medicare’s website (www.medicare.gov) with small logos: D for dental, V for vision, and H for hearing. See Chapter 11 for info on using the plan finder to compare details of Medicare Advantage plans.

Of course, as always in Medicare, some exceptions exist. You can get coverage for foot care in certain circumstances – for example, if you have foot problems caused by conditions such as diabetes, cancer, multiple sclerosis, chronic kidney disease, malnutrition, or inflammation of the veins related to blood clots – especially if the act of toenail clipping would be hazardous to your health unless done by a professional. But the bottom line is that to get Medicare coverage for foot care, you need your doctor or podiatrist to provide evidence that said care is medically necessary.

Home safety items

Medicare spends billions of dollars a year on treating the results of falls, and older Americans are five times more likely to end up in the hospital for falls than for any other injuries. So you’d think that Medicare would try to save at least some of those billions by covering safety items that help prevent people from falling. But no, it doesn’t.

To be sure, Medicare covers a few items it deems medically reasonable if prescribed by a doctor – for example, seat lifts that help incapacitated people sit down or get up from a chair or trapeze bars that help people sit up or alter positions when confined to bed. But Medicare doesn’t pay for equipment it considers items of convenience rather than of medical necessity. A long list of noncovered items includes stair lifts or elevators, bathtub lifts or seats, grab bars, room heaters, air conditioners, humidifiers, posture chairs, massage devices, physical fitness equipment, and medical emergency alert systems.

But you may be able to get help in other ways:

❯❯ If you’re a veteran with disabilities, be aware that the Department of Veterans Affairs has little-known programs that provide cash grants to help eligible vets make safety improvements in their homes. Call the VA at 877-827-3702, email sahinfo.vbaco@va.gov, or go to www.benefits.va.gov/homeloans/adaptedhousing.asp.

❯❯ If your income is limited, contact the nonprofit organization Rebuilding Together, which provides volunteers to make housing repairs and install safety equipment free of charge. Call 800-473-4229 or go to http://rebuildingtogether.org for local information.

❯❯ If you file itemized tax returns, you may be able to deduct the costs of home improvements for medical reasons, as indicated in Chapter 4.

Nursing home care

Many people are surprised, and often alarmed, to learn that Medicare doesn’t cover long-term care in nursing homes. I’m not talking here about short-term stays in a skilled nursing facility (most of which are nursing homes) after leaving the hospital; Medicare does cover those stays in specific circumstances. (I describe this kind of skilled nursing care earlier in this chapter and also explain the ins and outs of qualifying for it in Chapter 14.)

But what if you become too sick or incapacitated to live at home and need the constant long-term care that a nursing home provides? Medicare will continue to cover your medical needs, but it won’t pay for what it calls custodial care, which refers to help with the activities of daily life such as using the bathroom, dressing, and so on. Nor will Medicare pay for your room and meals in a nursing home. These same rules apply to assisted living facilities.

Most people living in nursing homes pay for their custodial care out of pocket – with the help of long-term care insurance, if they’ve purchased it – until their resources run dry. At that point, they usually become eligible for Medicaid, the state-run health care system for people with very limited incomes and resources, which does pay the custodial care bills of people who qualify. (Because of the similarity in names, many people confuse Medicare and Medicaid, especially when it comes to thinking about long-term care.)

Eligibility rules for Medicaid vary from state to state. (And the name of the program is different in some states – for example, MediCal in California, MassHealth in Massachusetts, and TennCare in Tennessee.) To find out how the rules apply to you or a family member, you may need to consult an informed counselor or a qualified elder care attorney.

For contact information of people who can help, check out the official document “Agencies That Can Help with Long-Term Care Choices” at www.medicare.gov/NursingHomeCompare/Resources/RelatedWebsites/LTC-Help.aspx.

Medical services abroad

Medicare doesn’t pay for medical services outside of the United States and its territories except in these extremely rare circumstances:

❯❯ You’re traveling between Alaska and another state and have a medical emergency that means you must be treated in Canada.

❯❯ A medical emergency occurs while you’re in the United States or its territories, but the nearest hospital is in a foreign country – for example, across the border in Canada or Mexico.

❯❯ You live within the United States or its territories and need hospital care (regardless of whether it’s an emergency), but your nearest hospital is in a foreign country.

Some Medigap supplemental insurance policies (those labeled C, D, F, G, M, or N) cover emergency or urgently needed treatment abroad. (I explain Medigap insurance in Chapter 4.) In this situation, you pay a $250 deductible and 20 percent of the cost of the medical services you use up to a lifetime maximum of $50,000. Some Medicare Advantage plans also cover emergencies abroad, and so do some employer benefits and TRICARE military benefits. But otherwise, you need to buy travel insurance that includes medical emergencies when planning journeys abroad.

What if you live abroad? Medical treatment in other countries is almost always less expensive than in the United States, so paying out of pocket may not bankrupt you. And in some circumstances, you may be taken care of by the national health program of the country you’re living in. But buying health insurance on the open market may be difficult or very expensive. One option is to join a nonprofit organization called the Association of Americans Resident Overseas (www.aaro.org), which has long lobbied Congress to make Medicare available abroad. AARO offers its members access to a variety of private health insurance plans that can be used in many countries. (You can enroll in Medicare while living abroad, however; turn to Chapter 6 for important information about this kind of enrollment.)

Services that may be nice but aren’t necessary

You probably aren’t surprised to know that you can’t get a face-lift or a tummy tuck at taxpayers’ expense. Surgery solely for cosmetic purposes is one of the absolute no-no’s of Medicare coverage. (Medicare does cover bariatric surgery to reduce the size of the stomach in very obese people, but this procedure is to lessen their risk of serious health disorders and not to improve their looks.)

Acupuncture and other alternative medical practices are barred under traditional Medicare. Physical fitness classes and gym memberships are also excluded. But some of these services (notably gym memberships) are covered as extras in some Medicare Advantage plans.

Even something as relatively mainstream as chiropractic care may be excluded from Medicare coverage in many circumstances. Chiropractors help lessen the pain of spine and joint problems, most often by the manipulation of bones. Medicare covers manipulative treatment from a licensed chiropractic physician when you’re injured or in pain because of a problem with the spine and provided that the treatment is clearly improving your condition. But Medicare doesn’t pay for the manipulation of other joints (such as shoulders and knees) or for other types of chiropractic care such as massage or traction. And it doesn’t pay for maintenance care to keep you stable if you aren’t demonstrably improving.

Finally, in the hospital, Medicare doesn’t cover a private room (unless sharing one would be medically inadvisable), private nursing, or conveniences like a telephone or television if these items are billed separately.

Distinguishing When Coverage Comes with Limits

If you’ve had a hip replacement but fall again and need another, Medicare isn’t going to turn around and deny you coverage for the second one. If you’re fighting your third bout of pneumonia, Medicare isn’t going to shut you out of the hospital because of the first two episodes. If you’re in your 90s and have heart failure or cancer, Medicare isn’t going to refuse you treatment because you’re too old. For all the loose and cruelly inaccurate talk about “death panels” and “rationing” that still circulates in mass emails meant to exploit older people’s fears of being denied coverage, Medicare simply doesn’t – and can’t, by law – ration care like that. “Medical necessity” is what usually counts.

At the same time, Medicare has always placed limits on certain areas of coverage – and although Washington policymakers may regard these caps as reasonable attempts to rein in runaway costs and guard against fraud, the limits can adversely affect some patients. So on the basis that forewarned is forearmed, the following sections provide an overview of the four main areas where coverage comes with limits: stays in the hospital, stays in a skilled nursing facility, mental health benefits, and therapy services.

Limits on hospital stays

Most people these days don’t spend more than a few days in the hospital, and the fear of catching a really bad hospital infection – known as a leading cause of death – is enough to make anyone want out of there as soon as possible. So the chances that you’ll exhaust Medicare coverage during a hospital stay are remote. Still, in case you get sick enough to need a long spell in the hospital, the following sections clue you in to how the limits work.

If you’re enrolled in traditional Medicare

If you need to stay for a long period in the hospital for one spell of illness that’s known as a benefit period, Medicare will cover 100 percent of your nursing and living costs for the first 60 days after you’ve met a deductible. For days 61 to 90, you’re required to pay a daily co-pay. (I explain these costs in Chapter 3, and I go into detail about benefit periods in Chapter 14.)

No limit caps the number of benefit periods you can have, provided that 60 days have elapsed between each one. But if you still need to be in the hospital longer than 90 days in any one benefit period, you must either pay the full cost yourself or draw on up to 60 more days for which you pay hefty daily co-pays. These 60 days are called lifetime reserve days. You can use as many as you want or save some in case you need them in the future. But, as the phrase implies, when you’ve used them, they’re gone for good.

However, all Medigap supplemental insurance policies (explained in Chapter 4) extend Part A hospital coverage for up to an additional 365 days in your lifetime after Medicare benefits are exhausted. And most Medigap policies pay for the Part A hospital deductible too. If you’re enrolled in Medicaid (state medical assistance), this program usually covers the co-pays for lifetime reserve days.

If you’re enrolled in a Medicare Advantage health plan

Medicare Advantage plans usually have a simpler system for charging for hospital stays. Often they charge a daily co-pay for the first several days and nothing for the remaining days. Most plans set no limits on the number of days they cover, so you don’t need to draw on lifetime reserve days. But some plans do set limits, although sometimes they charge no co-pays for the lifetime reserve days. Comparing the differences between Medicare Advantage plans and traditional Medicare when it comes to hospital stays is an important topic that I discuss in Chapters 9 and 11.

Limits on skilled nursing facility stays

If you need continuing skilled nursing care after you’ve been in the hospital and meet certain conditions (as explained earlier in this chapter and in Chapter 14), Medicare covers a stay in a skilled nursing facility – but it comes with limits. Beyond 100 days in each benefit period, you’d pay the full cost unless you have additional insurance. Some or all of these costs may be covered if you have additional insurance coverage through Medicaid, employer health benefits, long-term care insurance, or Medigap supplemental insurance. Check your policy to find out. Most Medicare Advantage plans also limit coverage to 100 days in a benefit period.

Limits on mental health benefits

Like many other insurance plans, Medicare treats care for mental health disorders differently from other health problems. This kind of discrimination is less common than it used to be in Medicare, but some limits are still placed on mental health benefits, as described in the following sections.

Outpatient psychiatric services

In the past, traditional Medicare charged more than twice as much for seeing a mental health professional as an outpatient than for seeing any other kind of doctor – co-pays of 50 percent of the cost of a visit rather than 20 percent. But since 2010, under a law passed in 2008, those co-pay costs have gradually come down. Today, you pay the standard 20 percent co-pay for outpatient psychiatric care, and Medicare pays the rest. If you have Medigap insurance, these co-pays are covered. If you’re in a Medicare Advantage plan, you pay what your plan requires.

Psychiatric care in a hospital

The 2008 health care law didn’t change a discriminatory situation in which Medicare patients are limited to 190 days over their lifetime for receiving inpatient treatment in psychiatric hospitals – those that specialize in mental health conditions. Yet Medicare places no such limit on care in general hospitals. So any days you spend in a non-psychiatric hospital – even if you’re being treated for a mental health condition – don’t count toward the 190-day lifetime limit.

Whether you receive mental health care in a psychiatric or a general hospital, the Part A hospital deductible and co-pays are the same as those for other medical conditions. These costs are explained in Chapter 3.

In some circumstances, Medicare covers partial hospitalization, which means receiving treatment at a hospital’s outpatient department or clinic or at a community mental health center during the day, but not spending the night there. Your costs for this type of service vary according to the treatment provided, but under Medicare rules it can’t be more than 40 percent of the Medicare-approved amount.

For more details, see the publication “Medicare & Your Mental Health Benefits” at www.medicare.gov/publications/pubs/pdf/10184.pdf.

Mental health benefits in Medicare Advantage plans

Because mental health benefits may vary among Medicare Advantage plans, look at the evidence of coverage documents for your plan. But most plans stick to the same limit of 190 lifetime days for inpatient care in a psychiatric hospital.

Limits on therapy services

Medicare limits the amount of coverage you can get for therapy services in any given year as an outpatient or in a hospital outpatient department or emergency room. In 2015, the limits were $1,940 for occupational therapy and $1,940 for physical therapy and speech-language pathology combined. These dollar limits are the total cost of the services received in a year – including what Medicare pays (80 percent of the Medicare-approved amount) and what you pay (20 percent). Medicare may continue to cover these services beyond the annual limits if you have a condition that requires ongoing therapy, such as extensive rehabilitation for stroke or heart disease. To get this exception, your therapist must justify the need when she bills Medicare. If the total cost reaches $3,700 in a year, Medicare automatically reviews your case.

For specific information, see the publication “Medicare Limits on Therapy Services” at www.medicare.gov/Pubs/pdf/10988.pdf.