Whatis the reason why most Medicare beneficiaries obtain some form ofhealth insurance coverage? Gap Insurance.
Whatis the reason why most Medicare beneficiaries obtain some form ofhealth insurance coverage? Describe Gap Insurance.
Medicareis a form of social insurance that was started in 1966 by the federalgovernment of the United States to provide health insurance servicesto persons aged over 65 years (Morrisey,2008).Initially, the program was designed to provide health insurance tothe military personnel and their families. To be enrolled, it is arequirement that an individual must have worked in the United Statesfor a period not less than 5 years and paid social security feestowards the system. In addition, the system also provides healthinsurance to the young generation affected by end stage renalcondition, disability and lateral sclerosis. Other specific medicalconditions can also be covered by the system.
Medicareis essentially divided in to four main plans. Part A provides coverto hospital stays not exceeding 90 days and is typically a hospitalinsurance plan. The first 60 days of stay will be paid forautomatically by Medicare in full while the remaining days will besubject to a copayment of $1,288 (Morrisey,2008).Part B on the other hand is a plan designed to pay for services aswell as products that have not been covered under plan A. It isoptional however and can be deferred if an individual or theirspouses are still in gainful employment. Part C is a form ofsupplementary plan meant to give individuals access to the benefitsof other plans. Part D is a benefit plan that can be enjoyed byindividuals covered in plan A or plan B. This essay explains whybeneficiaries of Medicare feel the need to obtain other forms ofhealth insurance coverage. It will also describe gap insurance.
Thereason for beneficiaries’ need to obtain other health insurancecoverage is because Medicare has never been enough. Medicare does notpay for all medical costs of beneficiaries. In fact, many costs arenot paid for at all. Irrespective of the plan a beneficiary isenrolled in to, there will always be additional medical expenses thatwill not be covered by Medicare. Generally, Medicare provide cover toannual health-care costs not exceeding 65 per cent. Again, Medicarebeneficiaries are responsible for co-payment, coinsurance and paymentof other deductibles. It is estimated that an additional $250,000medical expense will be atleast incurred by a typical couple for allthose costs not covered by Medicare ("OvervaluingEmployer-Sponsored Health Insurance", 2015). This an immense sum of money.
Manybeneficiaries have also come to question the quality of servicesprovided under Medicare. It has been argued that the program’spayments are politicized and has been changed over time by lobbyistsfrom being a legal entitlement to the beneficiaries to being a formof political entitlement to its providers. This together with theadditional payments that are necessary under the Medicare plans hasmade almost 90 per cent of all Medicare beneficiaries to seek otherforms of health insurance coverage as a supplementary plan to coverfor the costs that will not be covered under Medicare.
Gapinsurance is a plan designed to cover the difference between totalmedical costs and the benefit that an individual is entitled to undera given health insurance plan. The term is also used to designate anyCOBRA (ConsolidatedOmnibus Budget Reconciliation Act) or non-COBRA plan that is used asan alternative between two health insurance plans to cover a certaintime period. In summary, gap insurance is a supplementary plan tocover for additional costs not covered under the primary insuranceplan. Examples of gap insurance include: Medigap insurance,short-term major medical insurance, COBRA, welfare plans, individualmedical insurance, welfare plans among others.
Medigaphelps Medicare beneficiaries to cover for additional costs orout-of-pocket costs. In this policy, an individual is subject topayment of monthly premiums that will vary markedly depending on anindividual’s age, status of health, place of residence andbenefits. It is recommended that any Medicare beneficiary withoutother forms of supplementary insurance considers enrollment in toMedigap policy.
Tobe eligible for Medigap insurance, an individual is needed to haveenrolled in either plan A or B of the Medicare available plans(Morrisey,2008).It is important to take note that Medigap does not replace theprimary insurance plan but is only meant to help beneficiariesreceive required services without strain especially during times ofemergencies. Medigap plans will usually cover individuals for thefirst six-month period following enrolment in to plan B but sometimesindividuals can be made to wait longer than six months beforepreexisting conditions can be covered.
Gapplans are usually more desirable options than shifting to plans withhigher deductible amounts. With the cost of health going up each day,there is need for people to consider the benefits of gap insurance.Small businesses and organizations are increasingly enrolling in togap insurance plans. Gap insurance helps cover for the beneficiary’sresponsibilities of coinsurance, copayment and deductibles.
Inconclusion, most Medicare beneficiaries feel the need to obtain otherforms of health insurance coverage because Medicare does not coverall the medical costs. No matter what plan an individual is enrolledin, there will always be out-of-pocket costs (Morrisey,2008).As a requirement by Medicare which is a primary health insurance,beneficiaries have a responsibility in copayment, coinsurance andpayment of other deductibles. For this reason, many beneficiariesconsider supplementary plans such as Medigap in their insuranceplans. Gap insurance is a viable option even when enrolled in primaryinsurance plans especially given that the cost of health is soaringeach day.
Reference
Morrisey,M. (2008). Healthinsurance.Chicago, Ill.: Health Administration Press.
OvervaluingEmployer-Sponsored Health Insurance. (2015). KLR.http://dx.doi.org/10.17161/1808.20289