For 64 years, your insurance works one way, then suddenly, you turn 65, and everything you thought you knew goes out the window. You gaze into the labyrinth of Medicare and hope you get Theseus and not the Minotaur.

Allow me to make like Ariadne and spin a yarn to help navigate these corridors. For this purpose, the dollar amounts given apply to 2024 and can be confirmed at medicare.gov

The biggest takeaway that people need to understand with original Medicare is that, unlike employer-provided insurance or an individual policy, there is no Maximum Out-of-pocket.

Generally, Medicare charges a whole lot less than commercial for practically every procedure as the government sets the prices; however, there is no cap on annual charges. The Max OOP in under 65 insurance limits your loss. If the Max OOP is $6,500, then that means only $6,500 total can be charged in one year, not including premiums. Original Medicare does not have this limit.

Original Medicare has two parts: A and B. Part A is free-ish. If you or your spouse paid taxes for ten years, it is premium-free. Otherwise, it costs between $278 and $505 monthly. So, if you didn’t pay taxes, marry someone that did. Part B has a monthly premium beginning at $174.70. Part B is subject to income and can scale up to $594 monthly.

Part A is usually referred to as “hospital insurance,” but I prefer to think of it as “room and board” insurance. “Hospital insurance” confuses people because that implies that everything in the hospital is covered. It isn’t. Broadly, Part A covers the room, the bed, general nursing, meals and it also helps cover skilled nursing facilities and hospice — mostly places involving a room and a bed.

Part A has a resetting deductible of $1,632. The first 60 days in the hospital are covered by this deductible, then days 61-90 cost $408 dollars daily, 91–150 cost $816 a day while using the 60 lifetime reserve days, and afterward, it is all out of pocket.

After 60 days without hospital services, the deductible resets and must be paid again if used. Skilled nursing facilities have the first 20 days covered at no cost, then 80 days at $200 and afterward, everything is out of pocket.

Remember how I said Part A doesn’t cover everything in a hospital? Doctors are in hospitals, and Part B is what pays them, as well as anything considered to be “durable medical equipment.” If you don’t have Part B, then everything the doctor does is out of pocket, which is why it is often referred to as “Medical Insurance.” It has a one-time $240 deductible that resets annually like traditional insurance. In general, there is a 20% copay on most of the services covered by Part B.

So, how do we solve the problem of no Max OOP?
Medicare Advantage plans or Medicare Supplements both provide an answer. In the Nov. 1 issue, I’ll compare the two.