Who qualifies: People 65 and older, younger people with disabilities and people with end-stage renal disease. The Social Security Administration (SSA) oversees eligibility and enrollment. The best time to apply for Medicare A is at the first opportunity to do so: the seven-month period that starts three months before a person's 65th birthday. Those who miss that chance can always apply later without seeing a reduction in benefits. And anyone receiving a Social Security check automatically should be enrolled in Medicare A. To find out more about enrollment call the SSA at 800-772-1213, or visit www.ssa.gov.

What it covers: For each benefit period, all costs, less an $812 deductible, for the first 60 days of a hospital stay (semi-private rooms only; TVs and telephones not included). For the next 30 days, all costs minus a $203-a-day co-payment. In addition, each beneficiary gets 60 nonrenewable Lifetime Reserve Days, which can be added as needed onto the first 90 days of a hospital stay. Medicare A covers the cost of these days less a $406-a-day co-payment. Each benefit period begins on the first day a beneficiary enters the hospital and ends after he or she has gone 60 consecutive days without hospital care. SNF coverage lasts a maximum of 100 days during a benefit period (note: the average nursing home stay is currently 2 1/2 years). There is a $101.50-per-day co-payment for days 21 to 100 in this period.
What it costs: For a beneficiary or his or her spouse who has worked and paid Medicare taxes for at least 10 years, Part A is premium-free. In some cases, the insurance can be purchased even if no Medicare taxes have been paid. For information on this, go to www.medicare.gov.

MEDICARE B

What it is: The other half of the Original Medicare Plan, this fee-for-service plan pays for some outpatient hospital and mental-health services, doctors' services (not routine physical exams but many preventive screenings), laboratory fees, medical equipment such as wheelchairs and, in rare cases, prescription drugs. People with other health insurance—from an employer or former employer, for example—can use that to augment Medicare B or can simply choose not to sign up for Medicare B.
Who qualifies: Same as Medicare A, except that those who don't sign up at their first opportunity can do so only during limited annual open-enrollment periods in subsequent years.

What it covers: Eighty percent of the approved cost of a given service, as defined by Medicare. (Doctors who "accept assignment" agree that the approved cost will constitute payment in full. Those who don't can charge up to an additional 15 percent, and the beneficiary will be reimbursed only 80 percent of the approved cost by Medicare.) Medicare B also covers 50 percent of most outpatient mental-health services; 80 percent of physical, occupational and speech therapy; and 100 percent of most part-time skilled home health care.

What it costs: Monthly premiums of $54; an annual deductible of $100; co-insurance (the uncovered 20 percent of the assigned cost); additional charges if a doctor does not accept assignment. Premiums are usually deducted from monthly Social Security payments. Beneficiaries who delay enrolling in Medicare B beyond their first chance to do so may wind up paying higher premiums. Call 800-MEDICARE for specifics.

Helpful Links

• http://www.aarpmagazine.org/family/Articles/a2003-01-21-understandingmed.html
• http://seniorhealth.about.com/od/medicareinsurance/
• http://money.cnn.com/2003/12/10/pf/insurance/5tips_medicare
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