Little-known facts about Medicare
Qualifying for Medicare is Not Automatic, and Not All Over-65-Year-Olds Meet the Minimums. Medicare Part B is Not Free, Not Every Type of Medical Care is Covered, and Medicare Fraud is Common
Medicare is the U.S. federal health insurance program designed to provide coverage for the cost of medical bills for individuals aged 65 and older, as well as certain younger people with disabilities and those with end-stage renal disease. I have seen numerous court rulings regarding benefits available to injured parties that assume that, once a plaintiff reaches the age of 65, Medicare will cover them. The financial obligation of the tortfeasor/defendant ends. This is based on the assumption that Medicare is free and automatic for any U.S. citizen over the age of 65. That is an incorrect assumption. There are several requirements to be eligible for and to receive Medicare coverage. Sadly, Medicare fraud is common, which wastes resources that could otherwise go to Medicare insureds in need of medical care.
- A little-known fact about Medicare is that Americans do not automatically qualify for Medicare. You need 40 work credits, or about 10 years of work, to be eligible for premium-free Medicare Part A (hospital insurance). You can earn a maximum of four credits per year, and each credit correlates to a specific amount of earnings, which is updated annually. The amount of earnings required for a credit changes annually. For 2025, you earn one Social Security and Medicare credit for every $1,810 in covered earnings, with a maximum of four credits for earning $7,240 or more.[1] You can also qualify for premium-free Part A through a spouse or based on a disability or certain medical conditions, such as End-Stage Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS).[2]
- If you want more than just insurance for hospitalizations, you’ll generally have to pay $185 each month for Medicare Part B (or higher, depending on your income).
- If you wait until 3 months before age 65 and apply for Social Security, you have to apply for Medicare and enroll in Medicare Part A first before you can receive paid benefits that come from other Parts. Only if you start receiving Medicare at age 62 or later, and up to four months before age 65, is Medicare Part A and Part B enrollment automatic. If you are not ready to receive Social Security because you are still working at age 65, then you may apply for Medicare only.[3]
- If you make more money before enrolling in Medicare, your Part B premium will be higher.
- There is a special type of Medicare plan offered through commercial insurers, known as Medicare Part C, also referred to as Medicare Advantage.
- Medicare will cover weight loss programs (aka “obesity treatment”) that are determined to be medically necessary if you require treatment for diseases like diabetes.[4]
- Medicare does not cover 100% of your medical costs; instead, it generally covers 80% of eligible [5] medical expenses. Medicare Part A covers a hospital stay by covering the first 60 days after you meet the $1,676 deductible. For extended stays, you’ll incur coinsurance costs of $419 per day for days 61-90 and $838 per day for each of the 60 lifetime reserve days, if used. After you’ve used all 60 lifetime reserve days, you are responsible for all costs.[6]
- Medicare will not cover medical expenses when you travel outside of the U.S. Medicare will not cover medical expenses when you travel outside of the U.S. There are only three situations where Medicare will cover healthcare received in a foreign country: (a) if you are in the U.S. and a foreign hospital is closer, (b) you are traveling through Canada en route to Alaska and have a medical emergency, and a Canadian hospital is closer, or (c) you live in the U.S. and a foreign hospital is closer regardless of whether you have an emergency.[7]
- Medicare does not cover Long Term Care (“LTC”), but you may be able to apply for Medicaid or become a ‘dual eligible’ to receive state Medicaid coverage for long-term care.[8] Medicaid eligibility is limited to those with incomes below the Federal Poverty Level (“FPL”) or up to approximately 1.35 times the FPL in Medicaid expansion states. If your household earnings are higher than the FPL, you can qualify if your income has been below the FPL for five years, and there is also a criterion for assets.[9]
- Medicare does not cover dental, vision, or hearing unless you enroll in a Medicare Part C plan offered by a commercial insurance company.[10]
- A little-known fact about Medicare is that Medicare fraud is common. As of 2015, over ten years ago, the estimated annual costs to federal taxpayers for Medicare fraud were over $60 billion, according to the U.S. Government Accountability Office (“GAO”), and current estimates are likely even higher. [11] Fraud is sometimes complex to detect without a whistleblower (commonly called a “Relator” in the False Claims Act, who brings a lawsuit on behalf of the government).[12] Usually, prosecuting a False Claims Act case is complex and costly, and counsel for the Relator retains expert witnesses in Medicare billing and Medicare fraud to explain the industry’s custom and practice of submitting accurate, medically necessary medical claims, as well as what would generally be considered an improper way to submit medical claims. Sometimes complex documents called Medicare Local Coverage Determinations (or “Medicare LCDs”) must be interpreted by an expert to explain what medical conditions or diagnoses are covered, or what medical procedures are “medically necessary,” based on the match between a Medicare-covered condition and a Medicare-covered procedure or service. Medicare LCDs often have associated “Articles” that explain more details on what the LCD means.
The program is structured into different parts and supplementary policies. The types of Medicare include:
| Type or “Part” | Brief Description of what it covers | cost and how to get covered |
| Medicare Part A | Hospital Insurance | Generally, it’s zero cost; however, you must have 40 work credits to qualify for zero cost. [13] |
| Medicare Part B | (Medical Insurance for non-hospital, generally outpatient medical care)
| $185 each month (or higher, depending on your income).[14] |
| Medicare Part C | Medicare Advantage usually combines Part A, Part B, and may include Part D | A low or $0 monthly plan premium for many, but you’ll still pay a Medicare Part B premium (which was $185/month in 2025) and your Part C plan’s specific copayments, deductibles, and coinsurance for services.[15] |
| Medicare Part D | Prescription Drug Coverage | Monthly premiums vary based on which plan you join. The amount can change each year. You may also be required to pay an additional amount each month based on your income. [16] |
| Medigap (sold by non-government commercial insurers) | Supplemental insurance covers copayments and coinsurance not covered by Original Medicare | Costs vary, typically from under ($50) to over \(\$300\) per month[17] |
Medigap Insurance Policies (Medicare Supplement Insurance available from private companies)
Each “part” allows beneficiaries to customize their coverage, but also creates complexity that can be challenging to navigate.
Medicare Part A (Hospital Insurance)
Medicare Part A covers inpatient care in hospitals, skilled nursing facility care, hospice care, and home health services. For most people, Part A is premium-free because they or their spouse paid Medicare taxes through their employment for at least 10 years. This premium-free status is a key benefit, though beneficiaries are still responsible for certain out-of-pocket costs, such as deductibles and coinsurance for extended hospital stays. Part A is designed to cover the high costs associated with inpatient treatment, but does not pay for outpatient doctor visits or other medical services.
Medicare Part B (Medical Insurance)
Medicare Part B covers medically necessary services and supplies, including doctors’ services, outpatient care, durable medical equipment, and some preventive services. Unlike Part A, Part B requires a monthly premium, with the amount potentially higher for individuals with higher incomes. After meeting a yearly deductible, beneficiaries typically pay a coinsurance for covered services. Part B is crucial for covering day-to-day medical needs, but it does not cover most prescription drugs, a significant limitation that necessitates additional coverage.
Original Medicare (Parts A & B) and the coverage gaps.
Together, Part A and Part B constitute what is known as Original Medicare, which is provided directly by the federal government. While it offers broad coverage for hospital and medical services, it leaves significant gaps. Beneficiaries face unlimited out-of-pocket costs and have no coverage for routine dental, vision, or hearing care. To address these deficiencies, many people opt for additional coverage through private insurance plans.
Medicare Part C (blends Part and Part B and may include Part D)
Another little-known fact about Medicare is that Medicare Part C, also known as Medicare Advantage, provides an alternative to Original Medicare. Private, Medicare-approved companies offer these plans and must cover all services included in Parts A and B. Additionally, many Part C plans offer extra benefits not covered by Original Medicare, including dental, vision, and hearing services. Most Medicare Advantage plans also bundle in prescription drug coverage (Part D). A key feature of Part C is that many plans have a maximum out-of-pocket spending limit, providing beneficiaries with more predictable costs. However, most plans have provider networks, which may limit a beneficiary’s choice of doctors and hospitals.
Medicare Part D (Prescription Drug Coverage)
Medicare Part D provides optional prescription drug coverage through private insurance companies approved by Medicare. Individuals with Original Medicare can enroll in a standalone Part D plan to help cover their medication costs. Most Part D plans use a formulary, or list of covered drugs, with different tiers that determine the price. Beneficiaries need to enroll as soon as they become eligible to avoid a permanent late enrollment penalty. Part D coverage is also frequently included as a feature of Medicare Advantage plans.
Medigap Policies (Medicare Supplement Insurance)
For those who choose Original Medicare Part A and Part B, Medigap policies can be purchased from private companies to cover some of the “gaps” in coverage, such as deductibles, coinsurance, and copayments. These standardized plans (identified by letters such as A, G, and N) work in conjunction with Original Medicare and pay after Medicare has paid its share. Unlike Medicare Advantage, Medigap policies do not cover prescription drugs; therefore, beneficiaries must purchase a separate Part D plan to obtain this coverage. Medigap plans do not cover everything that Medicare Parts A, B, and D do not. [18] The best time to purchase a Medigap policy is during the six-month Medigap Open Enrollment Period, as companies can’t refuse coverage or charge higher premiums due to pre-existing health conditions during this time.
Conclusion
Original Medicare (Parts A and B) provides basic coverage for hospital stays and doctors’ care outside of the hospital. The addition of Part D for drugs, or a bundled Part C plan, allows individuals to tailor their benefits to their specific health and financial circumstances. Medigap is an alternative method to expand coverage beyond Medicare Part A, Part B, and Part D. Medigap does not cover:[19]
- Long-term care (like care in a nursing home)
- Vision or dental care
- Hearing aids
- Glasses
- Private-duty nursing
Understanding the distinctions between these options is critical for making informed decisions about coverage and managing healthcare costs effectively.
[1] U.S. Social Security Administration. See https://www.ssa.gov/benefits/retirement/planner/credits.html#:~:text=You%20must%20earn%20at%20least,not%20increase%20your%20benefit%20amount.
[2] Id.
[3] USA.gov, an official website of the U.S. Government. See https://www.usa.gov/medicare
[4] National Council on Aging. See https://www.ncoa.org/article/obesity-treatment-and-medicare-a-guide-to-understanding-coverage/
[5] U.S. Department of Health and Human Services (“HHS”) Centers for Medicare and Medicaid Services (“CMS”). See https://www.medicare.gov/health-drug-plans/medigap/basics/coverage
[6] See Medicare.gov Inpatient Rehabilitation Care at https://www.medicare.gov/coverage/inpatient-rehabilitation-care
[7] Medicare.gov. See https://www.medicare.gov/publications/11037-medicare-coverage-outside-the-united-states.pdf
[8] National Council on Aging. See https://www.ncoa.org/article/does-medicaid-pay-for-nursing-homes-a-comprehensive-guide/
[9] Elder Care Resource Planning. See https://www.eldercareresourceplanning.org/medicaid-faq/eligibility/look-back/
[10] Medicare.gov See https://www.medicare.gov/basics/get-started-with-medicare/medicare-basics/how-does-medicare-work#:~:text=How%20does%20Medicare%20Advantage%20work,on%20which%20plan%20you%20join.
[11] June 2015, U.S. General Accountability Office (“GAO”). See Additional Actions Needed to Improve Eligibility Verification of Providers and Suppliers at https://www.gao.gov/assets/gao-15-448.pdf
[12] Phillips and Cohen. What is a Qui Tam? Whistleblower’s Guide to Qui Tam Lawsuits. See https://www.phillipsandcohen.com/what-is-a-qui-tam-case/#:~:text=back%20to%20top-,What%20is%20a%20qui%20tam%20relator?,back%20to%20top
[13] U.S. Social Security Administration. “What does Medicare Cost?” See what Medicare costs at https://www.medicare.gov/basics/get-started-with-medicare/medicare-basics/what-does-medicare-cost#:~:text=$0%20for%20most%20people%20(because,is%20the%20Part%20A%20penalty?
[14] Id
[15] U.S. Department of Health and Human Services (“HHS”) What is Medicare Part C? See https://www.hhs.gov/answers/medicare-and-medicaid/what-is-medicare-part-c/index.html
“Learn about what Medicare Part C costs.” See https://www.anthem.com/medicare/learn-about-medicare/medicare-part-c-costs
[16] Source: Anthem Insurance.
“Learn about what Medicare Part C costs.” See https://www.anthem.com/medicare/learn-about-medicare/medicare-part-c-costs
[17] Medigap.com “What is the average cost of Medigap insurance?” See https://www.medigap.com/faqs/average-cost-of-medigap-insurance-plans/#:~:text=premium%20rate%20comparisons?-,What’s%20the%20average%20cost%20of%20Medigap%20insurance?,qualify%20for%20a%20Guaranteed%20Issue.
[18] U.S. Department of Health and Human Services (“HHS”) Centers for Medicare and Medicaid Services (“CMS”). See https://www.medicare.gov/health-drug-plans/medigap/basics/coverage
[19] U.S. Department of Health and Human Services (“HHS”) Centers for Medicare and Medicaid Services (“CMS”). See https://www.medicare.gov/health-drug-plans/medigap/basics/coverage
