Medicare is at times regarded as a "single-payer" system and some experts-such as the New York Times commentator Paul Krugman-have debated on that point intensely. Honestly speaking, this isn't true (sincere apologies to Prof. Krugman) even though Medicare does share some traits with single-payer systems. Together, Medicare Parts A and B constitute a "direct payment" program. In the narrow sense, the program resembles some of the "single-payer" systems that people like Krugman have proposed. This program implies that service providers and facilities are paid directly by the federal government. Ultimately, the debate over whether "traditional" Medicare is a "single-payer" or "direct-payer" plan is less important to consumers compared to what the program takes care of.

The combination of Parts A and B, which is known as the 'Traditional Medicare' - does not cover:

• outpatient prescription drugs (having only a few exceptions)
• monthly premiums for Parts A, C or D
• dental care and dentures
• hearing aids
• routine foot care and/or orthopedic shoes
• routine eye care and/or glasses
• custodial care (help with bathing, dressing, toileting, and eating) at home or in a nursing home
• health care you receive while traveling outside of the United States (except under limited circumstances)
• cosmetic surgery
• routine or yearly physical exams
• deductibles, coinsurance requirements or co-payments when you get health care services (and, as we'll see below, these can be significant)

Medicare Part B, particularly, requires significant out-of-pocket payments from the consumer. According to the main Medicare web site(www.medicare.gov):

Medicare Part B pays all covered hospital, skilled nursing facility and home health care benefits for each benefit period except for the deductible. For the year 2011, for any hospital stay that implies 60 days or less, the deductible is $1,132. If the stay exceeds 60 days, a Medicare co-payment will apply. For stays that last 61 to 90 days, a Medicare co-payment of $283 per day will have to be paid by you. For stays of 91 to 150 days, you will have to pay $566 per day. If your hospital stay lasts longer than 150 days within a single benefit period, you will be required to pay the full cost for each day after the 150th day. For people on Medicare who receive care in a skilled nursing facility, a Medicare co-payment of $141.50 per day will apply to days 21 through 100. Medicare will cover days 1 through 20 in full. You will be required to pay in full any days after the 100th day.

For most people over 65, all of these exclusions add up to quite a bit of out-of-pocket expense. It's more than most people-especially those living on fixed incomes-can afford. So, a long hospital stay can be expensive-in fact dreadfully expensive-even with this coverage at your rescue. This is the reason why traditional Medicare can't completely be called a single-payer program; with so much that isn't covered, someone is paying a significant amount in addition to what's paid by the Feds.