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Video transcript

I'm here with dr. Lawrence Baker from Stanford Medical School and we're going to talk about what about Medicare Medicare I think we knew that was going to happen because we had this picture here already and so what is this a picture of I think that's a picture of LBJ signing and signing the Medicare Act in 1965 this is the time that we passed Medicare Lyndon Baines Johnson LBJ and this this is this looks like Truman right over here uh I think so maybe he was there because he I think was probably old enough by that point to to be a recipient yeah 65 and over so what so you know I think we all have a general idea of what Medicare is that it's kind of a health care program or an insurance program for people who are retired but then it starts to get fuzzy after that and then there are all these details that confuse most of us yeah so we talk about Medicare in a bunch of different ways Medicare is a program it's a US government program run by the federal government so it is run by the federal government yep and sometimes it's thrown in with Medicaid how are they different it's at a very high level so Medicaid is another a different insurance program run by the federal government in coordination with state government so it's Medicaid as a federal and state program Medicare is a federal program Medicare is for folks who are 65 years old and older and people with disabilities principally those two groups Medicaid is a program that's aimed at lower income populations and so this is this is older older people and disabilities yep this is low income kind of a kind of a poverty issue yes more so I let me write that down low income and this is primarily retirees or the majority the vast majority of people in there are folks who are there because there are over 65 okay and we're just going to focus on Medicare Medicare is federal government Medicaid is the federal and the state governments are in Medicaid because they're always sound very similar they sound very similar you know they're easily confused at certainly at the name level really different programs they operate completely separately in a few cases there are people who get access to both of them but they pay differently they run differently there nicely the federal level they are still run by the same organization the Centers for Medicaid and Medicare or Medicaid Services has a a subpart called Centers for Medicare and Medicaid Services if I have branch oh yeah let me executive branch of our government obviously and then you have the Secretary of Health and Human Services of Health and Human Services Health and Human Services and then within that you have EMS which is the Centers for and you were saying earlier should have two M's in it yeah it's the Centers for Medicare and Medicaid Services so I think it's just shorter to have one mm whatever value with the mms okay okay and these they administer at the federal level both Medicare and Medicaid yep but just to reiterate Medicare is really mainly a federal thing while Medicaid is both and the other one separately so you have Medicare here yep Medicare and then you have Medicaid here yeah I sorry all right all right so listen listen I've deep into Medicare so is it I guess I guess what is it okay so Medicare is an insurance program it provides insurance coverage for people who are eligible for it so if you're aged 65 and over or if you have a permanent disability couple other small groups if you have Lou Gehrig's disease or or end-stage renal disease kidney failure then you can get access to Medicare too but those are small populations so if you're in those groups you're eligible for Medicare Medicare will provide you with insurance that will cover hospital bills doctor bills some prescription drugs it'll cover lots of the medical care and is it you know I hear these things you know and this this is the part that I think gets confusing for everyone is they start hearing Part A Part B Part C Part D I don't know even if those are all the parts what what are those referring to and are they exactly insurance or are they something slightly different okay so part so Medicare has these four parts Part A Part B Part C and Part D and you know it can get a little confusing but we could break it up into some different pieces so the biggest one in terms of the number of people who are in it is what sometimes we call traditional Medicare and that's what historically is Part A and Part B and they kind of want to take those two together because they make a package okay and we call that maybe traditional Medicare sometimes people call it Original Medicare standard Medicare but okay you know when they pass the program when they first did it Part A was meant to cover Hospital expenditures and Part B was aimed at doctor cost cost we're seeing physicians of course those things go so closely together that nowadays Part A and Part B are kind of a pair so you really rarely would find someone who only wanted Part A or only one right sometimes here's dr. Koster is outpatient like so it's aimed apical sometimes you hear the word inpatient means you're you're living there while they're treating you outpatient you go visit them for an hour or two and leave and that's where you hear those yeah so that's a way of breaking up the kinds of services that medicine provides Medicare actually gets a little bit it's it's mix-and-match so if really a Medicare Part A expenditure is when a hospital bills Medicare for use of the hospital use of the room use of the services at the hospital anytime a doctor bills Medicare even if they saw the patient in the hospital they're going to be a Part B I see so it is it isn't it isn't a strictly inpatient outpatient it really is much more along the lines of hospital and doctor yep okay yeah well I'll I'll maybe put this in some type of I'll contain it away or something it's not necessarily it's not necessarily outpatient inpatient but maybe one way of life yes it's useful it is useful think about that I'm outpatient inpatient so it will cover everything that happens are we including drugs or okay so drugs is one key issue for the to the main question the first thing I guess I'd say is that Medicare for traditional Medicare is pretty comprehensive it covers you know most of the things that people would normally encounter and their rights right here does the coverage a drugs is one big exception it does not cut so Parts A and Part B do not cover prescription drugs so when when Lyndon Johnson was signing this if Truman had to get prescribed some drug and if he was a Medicare recipient he would in 1965 he would have to pay that out-of-pocket yeah so there so the I guess one caveat I'll note is that if you get prescription drugs that are administered to you while you're in the hospital Isis you're staying in the hospital they give you drugs that's going to be generally covered under Part A it's when your outpatient and you're going home and there's somebody sends you the pharmacy to pick up but I see yeah Medicare in its original form would not cover that they would not cover the part of the outpatient prescription drugs um so that became a problem for some folks and that has generated changes to the Medicare price there have been there is a part now that covers that yeah so that's the Part D program as a Medicare extension I know how far we want to go to feel we can all write that right here we'll just D for drugs yeah drugs has the whole story of prescription drugs and Medicare has you know kind of a lot to it people would buy additional policies if they had a and B right they buy themselves a private supplement that my favorite drug sometimes but now with the new Part D plan maybe people would buy that and so then there's other stuff probably is see right there there's a C that's come in and get into a second but but so a and B traditional a hospital's B doctors and what what percent you know with my with my health insurance there's a copay every time I visit the doctor it's you know twenty dollars how does it work with traditional Medicare Parts A and Part B so if you just have Part A and Part B then on the Part B side doctors are covered 80% of the Medicare allowable charges so Medicare has a fee schedule that governs what doctors can be paid for services and Medicare will cover 80% of that the patient pays 20 I see for Part A it gets a little more complicated but there's a co-payment that you have to make if you go to the hospital Medicare is going to have a co-payment of a fixed amount several hundred dollars coming up it's just not as simple as 80/20 it's not no not as simple as a each one you're going to pay a co-payment there too so you know they're not bad coverage but there's certainly some cost you can run up and if you're pretty sick you might really have a bill that's left and thereafter bears are extremely flexibility here you can see any doctor you want go to any hospital you want yeah Medicare Part A and Part B is by two one way of thinking one of the last bastions of health care as it exists or health insurance as it existed in America in 1965 70 75 when there were really minimal restrictions on what doctors you could see what hospitals you could use doctors get lots of discretion here about the kinds of things they're going to the services are going to provide and there's not a lot of oversight that you might see in today's HMOs or other kinds but there are still I maybe I'm wrong here there still are doctors that won't take Medicare patients so doctors can elect to be Medicare doctors or not and some doctors I think decided to have enough business patients from other places and you know Medicare is a plan it's got its rules and you have to follow the rules and some people think Medicare doesn't pay as well as other options they have so there are a few most of the doctors the vast majority of doctors in the country will work with megan is saying is it is kind of the super flexible thing if you do have an illness you can go see multiple doctors get second opinions you could go to the specialist on the other side of the country who so it is it is pretty good that way although you have to pay you know twenty percent of yes the doctor's visit so it's a pretty so what what are there so what happens that you know if I'm a retiree I don't have a lot of money and you know I have a major bill say I have a surgeries fifty thousand dollars I know that's more of a hospital inpatient thing but let's say I have to you know pay ten what are their options so that they don't have to pay that out-of-pocket um yeah so there's a bunch of things that go into trying to figure out what the cost to getting this are and Ryan how you might get coverage for some of these these other services the main thing that would be the answer to the question is there are supplemental policies so if you're a retiree and you've gotten Part A from because you're eligible for that you've page Medicare tax and you got Part B which you do have to pay a little bit of money every month small subsidized but still premium you have to pay you might decide in addition to that to pay for a supplemental insurance policy which you'd buy from a private place you know the AARP is one place it sells these there are others other folks and so on you pay an extra premium for that that's an additional insurance plan that you have and that might agree and you might have a method there to have them cover that ty % copay the additional hospitals I see in those plans there are some different varieties of those that cover more or less generously and of course charge a higher or lower premium for that I see that make complete sense and and and do people have to pay any premium to be in Medicare to get a and B both you have to a you generally don't if you pay your Medicare tax for 10 years working right work for 10 years here and pay your Medicare tax you get Part A for free okay but Part B charges a premium so you do have to pay small monthly well it's like it's like on the order of like a hundred dollars yeah generally it's gone up a little bit over time something like that not too much and you know maybe 100 or a little bit more per month which is which is nothing I mean if you're if you're 65 or over and you try to get a private policy you're probably looking at something like a thousand dollars a month yeah so this I guess two ways are thinking about it one this is heavily subsidized compared to what a person you know 75 years old ready would pay for a actual private insurance policy it would be much much higher than that you know there are people who look at that hundred a month and fixed income and Social Security and things and you say that's an issue and so one of the things that's just in the news the last few weeks is the fact that this number the number went up a bit Social Security payments went up a little bit but less actually than the Medicare surprised a you know I'm actually crazy you're buying Bo so there's some people who will still be worried about that even though it is heavily subsidized and looks like a great deal I see and then finally what so we know a B and then we have a little bit of D we know it's about covering drugs what what does C do C is that exists C yes he exists see I'm has been around for 20 or 30 years now C is a separate choice so when you turn 65 let's say you can make this choice a little bit differently sometimes too but when you turn 65 you might decide to take part a and Part B maybe by a traditional supplement maybe add the Part D drug plan on make yourself a package or you can elect Part C and Part C is an alternative under Part C what happens is the the CMS federal government has contracted with some HMOs Kaiser Blue Cross other places sometimes they've contracted with a few PPOs they've tried other kinds of plans too mostly its HMOs and so you have a choice then you can join Kaiser and have Kaiser B or your Medicare plan you can join the blue cross one you depending on where you are you'll have different choices of different private plans that have contracted and you can do that the federal government will then pay a bunch of your premium to them I some so you'll get covered by the by the private plan with the federal government covering your costs they might ask you to pay some additional premium you're going to have to pay your party equivalent already so you got to pay that amount but then you might have to pay a little bit extra I see and then you'll get access to what services that has and so some for some people that's attractive because though the co-payments and deductibles will be lower you'll often have more like the $10 copay right you might have access to some prescription drug coverage automatically built in there sometimes those cover some vision and other things right it might be nice so this is one or two plans I could get this whereas 80% coverage well I can't make that rule because hospitals it could be different but you get this kind of flexible thing but you have a pretty significant copay the 20% patient I could get supplemental insurance for me to cover some of that right over there or I can do Parts username for parsing that is part two these days is called Medicare Advantage I saw the plans in Part C are called Medicare Advantage plans and so you know which is really just Medicare paying subsidizing me to get private insurance right from some plans that have agreed to work with Medicare patients and you know they've agreed they do there's various checking up on them so they agree to me to basically cover everything that a and B would cover you know so you're not going to get skimped on and what do most people do they go a and B though traditional route early to go the sea route so historically the vast majority people have gone a and B route it changes kind of goes up and down over time depending on various factors but you know over the over a historical average be something like 80 85 90 percent and a and maybe 2015 10 and B and C depending on which year I learned that over the last 15 years right and we could probably do a whole series of videos on it but what what is so when a D come about it wasn't part of the original do you is not part of the original D comes about in the early 2000s under George Bush george w bush um and what we heard about I think was like 2003 I think I think that's probably about right and you know the issue there was there's a lot of a lot of folks who were having trouble getting their outpatient drugs covered in there so this is a plan this is another part of Medicare you can elect to buy this you normally would think about this if you got a and B and you want to get outpatient drugs however do you think about a D plan Part D is run by the federal government kind of the way that C is they pay up they subsidize and they pay a premium to the private plans that cover drugs and then I see the person at least they organized the market and the person then pays also some premium to guys still private to private a private entity will handle the actual reimbursements for the drugs but Medicare will pay them yeah so that you know the way to think about it is just a bunch of private entities with funds flows coming in you know partly from the person partly from Medicare by these okay so you and you would pay who do you pay your money to be paid to Medicare you paid to these these um I actually yeah I guess yeah she's not the same way remember one way or the other when you're paying this is optional a retiree or someone over 65 would pay money to essentially get a drug plan subsidized yes okay yes cool cool well you know I'm trying to figure out subsidies but you know there's some quite there's some intent to be able to participate in a drug plan I mean they are subsidized and the federal government is kicking a bunch of money in but it's a you know how exactly the economics of these plans works out is rising discussions right right now we could make a ton of videos no this is super helpful because I think you know frankly I didn't know about the differences right right here before about 15 minutes ago okay well thanks a bunch mm-hmm