What Is Medicare?
Medicare is the largest health insurer in the United States and is offered by the US government, serving more than 52 million people. It’s run by the Centers for Medicare & Medicaid Services (CMS), which is part of the US Department of Health and Human Services.
Medicare is divided into parts: A, B, and D.
Parts A and B are called “original Medicare,” since they have been in existence from its beginning.
Part A covers your care when you’re admitted to a hospital or skilled nursing center.
Part B covers all outpatient care.
Part D is prescription drug coverage.
Medicare covers US citizens and legal residents who are 65 and older, along with people that qualify due to a disability.
What Does Medicare Cost?
Part A comes to you at no cost. You’ve been paying for that through paycheck deductions.
Part B for most people costs $148.50 per month, but cost can vary based upon your income. The Part B premium will automatically be deducted from your social security check, or if you don’t receive social security, you can pay CMS directly.
You can verify your Medicare-eligibility status by visiting www.medicare.gov or calling 1-800-MEDICARE (1-800-633-4227), 24 hours a day, seven days a week.
New to Medicare?
You become eligible for Medicare the month you turn 65, so if you turn 65 on May 25th, you can get Medicare on May 1.
When can you enroll?
When you first become eligible for Medicare you have a specific enrollment period called the Initial Enrollment Period (IEP). You should start the enrollment process with Medicare three (3) months before you turn 65, and you have three months after your turn 65 to get Medicare.
- You must request enrollment for Part A and Part B. This is easy to do; simply call Social Security and request enrollment, or you can complete the process online.
- Don’t wait until the last minute. Get enrolled as soon as you can so you don’t miss your enrollment date. If you miss it, you must wait another month to enroll.
You can’t add or enroll in any other Medicare plans until you have enrolled in Part A and Part B, and have been assigned a Medicare #.
Additional Enrollment Periods
Once you have Medicare, each year you can make changes to your plan. Annual Election Period (AEP) for Medicare Advantage plans and prescription drug plans. October 15 – December 7: You can enroll in or change a Medicare Advantage or prescription drug plan for the next calendar year.
Annual Disenrollment Period (ADP) for Medicare Advantage plans and prescription drug plans.
January 1 – February 14: If you have a Medicare Advantage plan you can disenroll and go back to original Medicare. February 15 – October 14: You can generally only make changes to your Medicare Advantage Plan or prescription drug plan if you qualify for a special exception (move out of the area).
You can change Medicare supplement plans at any time, but you will need to qualify for them based upon your health history. You can only add a Medicare Advantage plan when you turn 65 or every year during the Annual Election Period (AEP).
Why Choose a Medicare Advantage Plan?
Medicare Advantage Plans:
A Medicare Advantage Plan combines all the Medicare coverage into one plan to include all your healthcare needs, including prescription drugs. They are offered by private insurance companies, and will vary based upon the state and county you live. Often they are available to you for a $0 premium, so all you pay for is your Medicare Part B. With a Medicare Advantage Plan you pay for it, only if you use it.
Medicare Advantage Plans will usually be an HMO or PPO plan. With a PPO plan you get the most access to doctors and facilities. For each type of medical care you have a set co-pay such as $20 for a doctor visit, $90 for an ER visit, $75 for an x-ray, etc. Co-pays will vary on the type of service and plan. These co-pays are capped each year for a maximum amount.
Medicare Advantage can also include dental, hearing and vision care, complimentary fitness memberships, along with other additional benefits beyond Medicare that come to you at little or no cost. These additional benefits will vary based upon the plan service area and company that offers the plan.
Given the low cost of a Medicare Advantage Plan it’s hard to beat the value of the plan over time. Even with a few co-pays, it will still be probably less than the premiums you will be paying for a Medicare Supplement.
Why Choose a Medicare Supplement Plan?
Medicare Supplement Plans:
A Medicare supplement is an insurance plan that basically covers most of what Medicare does not for healthcare. With a Medicare Supplement you are paying for coverage in case you need it, if you don’t use it you still pay for it. There are different brands and types (A, B, C, D, F, G, N). They are all standardized, meaning no matter what brand, they are all the same. The only difference is price. They are accepted by any doctor or facility that accepts Medicare.
When you turn 65, a Medicare Supplement will cost $100 – $150 per month depending upon your age. They go up in price each year, and can get pretty expensive once you get to age 70 and beyond. If you choose a Medicare Supplement, you will also need a Medicare
Part D plan, which is your prescription coverage. They cost $30 – $70 per month, and are available from several different insurance companies. All of this is in addition to paying for Medicare Part B, which for most people is $148.50.
Medicare Supplements are guaranteed issued to you when you turn 65, meaning your health history does not matter. After that you can add one or drop one at any time, but you will have to qualify for one, and not have any major pre-existing conditions.
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