Have you ever heard or read something about Medicare and wondered, "What does that even mean?" When it comes to Medicare health insurance, or any insurance for that matter, terms and phrases are used, but the meaning behind them isn't always so clear.
At Twin City Underwriters, we are a team of licensed insurance agents specializing in Medicare and senior insurance. In this article, we're breaking down common Medicare terms and acronyms into simple, easy-to-understand language so you can better understand your coverage, compare your Medicare plan options, and make informed decisions.
There is a lot to know when it comes to Medicare coverage. To make it easier, we will break down some of the most common Medicare terms by category.
Medicare Part A, the first part of Original Medicare, often referred to as 'hospital insurance,' covers services such as inpatient hospital care, skilled nursing facility care, and hospice care.
Medicare Part B, the second part of Original Medicare, often referred to as 'medical insurance, ' covers services such as doctor visits, specialist appointments, preventive care, some vaccinations, and more.
Find out more about Original Medicare Parts A and Part B
Medicare Part C is the part of Medicare that allows private insurance companies that Medicare approves to provide your Part A and Part B benefits. Medicare Part C is another name for Medicare Advantage.
Medicare Part D is the part of Medicare that allows private insurance companies approved by Medicare to provide coverage for prescription drug medications. Medicare Part D can be a stand-alone prescription drug plan or part of another Medicare plan, such as a Medicare Advantage plan.
Medicare Advantage is a type of Medicare Part C plan offered by private insurance companies that provides your Part A and Part B coverage and often includes additional benefits, such as prescription drug coverage, dental, vision, hearing, and wellness programs.
Medigap policies or Medicare Supplement plans are a type of insurance that helps cover some of the out-of-pocket costs with Original Medicare.
The payment you make each month for your Medicare coverage.
A percentage of the cost for healthcare-related care and services that you pay after your deductible.
A fixed amount that you pay for healthcare-related care and services after your deductible.
A deductible is a set amount that you pay annually before your plan starts sharing costs.
The most you will pay for in-network health care services or prescription medications, which can vary from plan to plan.
Prior authorization is a process some Medicare plans use to determine whether certain medical services, procedures, or prescription drugs meet their coverage requirements before they'll pay for them.
Medicare assignment simply means that there is an active agreement by a healthcare provider to accept Medicare-approved amounts as full payment for covered services.
A formulary is a list of prescription drugs that are covered by a specific Medicare Part D or Medicare Advantage prescription drug plan. Formularies are different from plan to plan, although every plan must cover at least two medications in each therapeutic category.
Looking for another Medicare term?
This article covers the terms people search for most often, but Medicare includes dozens of specialized words and abbreviations.
Visit our complete Medicare Glossary for an A–Z list of definitions.
Not only are there some terms that can be difficult to grasp, conversations and literature around Medicare often include acronyms that can make it even more confusing.
Below we'll highlight some of the most common acronyms that come up, what they really mean, so you can be informed and better understand your Medicare plan enrollment, options and coverage.
AEP stands for Annual Election Period or Annual Enrollment Period. AEP runs from October 15th - December 7th each year and is the time in which Medicare beneficiaries can make changes to their Medicare plan selections for the following year.
IEP stands for Initial Enrollment Period. IEP refers to the period when you can first enroll in Medicare Part A and Part B. This enrollment period lasts for 7 months: 3 months before your 65th birthday, the month of your birthday, and 3 months after.
SEP stands for Special Enrollment Period. An SEP is a unique period outside normal enrollment windows when you can join, switch, or drop a Medicare health or drug plan.
Learn more about qualifying SEPs
HMO stands for Health Managed Organization. This type of Medicare Advantage plan has a strict network, meaning you must receive care within this network for the plan to provide coverage. If you seek care outside of the network, you will be responsible for the full cost, unless it's a qualifying emergency.
PPO stands for Preferred Provider Organization. This type of Medicare Advantage plan allows you to see any doctor or specialist without a referral; however, staying in-network will cost you less in most cases.
PCP stands for primary care provider. For some Medicare plans, you may need to designate a primary care doctor when you apply for this plan (this helps ensure that the plan you are enrolling in has your primary doctor in the plan's network.
IRMAA stands for Income Related Monthly Adjustment Amount. In short, IRMAA is a potential extra charge added to your Medicare Part B or Part D premium that is determined based on your income taxes from 2 years prior.
Find out more about IRMAA
These are just a few of the abbreviations you'll encounter while researching Medicare.
For a complete list of Medicare terms and acronyms, visit our Medicare Glossary.
Understanding Medicare terms is an important first step, but choosing the right Medicare coverage often requires looking beyond the definitions and jargon. Every person's healthcare needs, prescriptions, preferred doctors, and budget are different, which is why it is so important to evaluate your options based on your unique situation.
Whether you're enrolling in Medicare for the very first time, reviewing your current coverage, or simply trying to better understand your benefits, having a knowledgeable resource and trusted partner can help you make more confident decisions and avoid signing up for the wrong medicare plan.
For nearly 60 years, Twin City Underwriters has been helping individuals just like you make sound Medicare health insurance decisions. Our team is here to help you navigate Medicare with confidence and not just during your initial enrollment, but throughout the entire year.
When you work with our team at Twin City Underwriters, you'll have the benefits of our SurePlan® Medicare System and access to:
Whether you're new to Medicare or considering making changes to your current plan, we're committed to providing personalized guidance and ongoing support so you can feel confident in your coverage.
Schedule Your Free, No-Obligation Medicare Consultation
Choosing a Medicare plan can be difficult. Twin City Underwriters helps Medicare recipients in Minnesota, Wisconsin, North Dakota, South Dakota, Iowa and Florida find the Medicare plan that meets their unique needs. Schedule a one-on-one meeting with one of our Medicare insurance brokers to get your questions answered!
Do you need help with Medicare, insurance and health plans? Explore your options with Allina Health Aetna, BlueCross BlueShield of Minnesota, Medica, HealthPartners, Health Spring, Humana, Security Health Plan, United HealthCare and more. We work with you to find the best plan for your needs and budget. Contact us today to get started.