Social Security, Medicare, and Other Government Programs

original Medicare

Term used to describe the original Medicare program, consisting of Parts A and B. Medicare coverage is divided into four parts (A, B, C, and D). Parts A and B, still called "Original Medicare," work in tandem to provide complete medical care coverage that is subject to deductibles and coinsurance (much like a reimbursement insurance policy).

unemployment insurance

joint federal and state programs to provide income benefits to unemployed workers who meet the specific program requirements. In most states, these programs are financed entirely by employer contributions

Medicare Advantage

Part C of Medicare program, previously known as Medicare+Choice, that allows beneficiaries to select HMOs and other alternatives to the traditional Medicare program

fully insured

an insured status under Social Security. This status requires either (1) 40 credits or (2) at least as many credits (but a minimum of six) as there are years elapsing after 1950 (or after the year in which age 21 is reached, if later) and before the year in which a person dies, becomes disabled, or reaches age 62, whichever occurs first.

temporary disability law

a law in a few states that requires employers to provide short-term disability income benefits to employees for non-work-related disabilities. Often referred to as an nonoccupational disability law

formulary

a list of preferred medications that a prescription drug plan will cover

creditable prescription drug coverage

a prescription drug coverage under other plans that is deemed to be equivalent to or better than the standard benefit plan for Medicare prescription drug coverage

State Health Insurance Assistance Plan (SHIP)

a state program that gets money from the federal government to give free health insurance counseling and assistance to people with Medicare

workers compensation law

a type of law enacted in all status under which employers are required to provide benefits to employees for losses that result from work-related accident or diseases. Benefits include medical care, disability income, income for survivors, and rehabilitative services

Social Security Statement

an annual statement automatically issued by the Social Security Administration that enables an employee to verify his or her contributions to the Social Security and Medicare programs. The statement also contains an estimate of benefits that will be available because of retirement, disability, or death

currently insured

an insured status under Social Security that requires a person to have at least six credits during the thirteen calendar quarters ending with the quarter in which death occurs

Medicare Part A

part of Medicare program that provides benefits for expenses incurred in hospitals, skilled-nursing facilities, and hospices

Medicare Part B

part of Medicare program that provides benefits for most medical expenses not covered under Part A

Medicare Part D

part of Medicare program that provides for prescription drug coverage

full retirement age

the age at which a worker can retire under Social Security and receive nonreduced benefits equal to his or her primary insurance amount (PIA). Also referred to as normal retirement age.

primary insurance amount (PIA)

the amount a worker will receive under Social Security if he or she retires at full retirement age or becomes disabled. It is also the amount of which all other Social Security income benefits are based

partial advance funding

the funding method used by Social Security and Medicare whereby taxes are more than sufficient to pay current benefits and thus provide some accumulation of assets for the payment of future benefits

disability insured

the insured status under Social Security necessary to receive disability benefits. It requires that a worker (1) be fully insured and (2) have had a minimum amount of work under Social Security within a recent period

OASDHI

the old age, survivors, disability, and health insurance program of the federal government. This program consists of Social Security and Medicare

earnings test

the process for determining whether income benefits of Social Security beneficiaries under the full retirement age should be reduced because of earned income that exceeds a specified amount that is subject to annual indexing

coverage gap (doughnut hole)

under Medicare prescription drug plans, the range in which the benficiary must pay the full cost of prescription drugs. Under a standard benefit structure, the gap begins after a beneficiary has incurred a specified dollar amount of expenses and continues until the plan begins paying again after total drug costs reach a second specified dollar amount. Also called doughnut hole