The Ultimate Guide to Medicare
Medicare is a federal health insurance program for Americans aged 65 and older. People with certain disabilities are also eligible for this coverage.
Medicare has two basic parts, part A and B, these are the original components of Medicare. Medicare Parts C and D, along with Medigap, are the supplemental coverage that can be purchased to complement standard Medicare.
To make choosing the right plan easier and ensure that you are making the right choice, it is important you understand the numerous factors involved. In this article, we will explain all the items you need to consider while choosing a Medicare plan.
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Medicare Part A – Hospital Insurance
covers if you become an inpatient in a hospital or skilled nursing facility. This insurance also provides coverage for hospice and home health care services.
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Medicare Part B – Medical Insurance
this part provides coverage for doctors’ services, outpatient care, lab work, durable medical equipment, home health care, and many other services.
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Medicare Part C – Medicare Advantage
is a private plan approved by Medicare. It includes the benefits under Part A and Part B in a single plan and usually includes additional benefits, such as dental, vision, and drug coverage.
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Medicare Part D – Prescription Drugs
it is private insurance approved by medicare that helps to cover the cost of prescription drugs.
Medicare Part A
Medicare Part A is health insurance for hospital-related expenses. It is provided by the United States government to citizens and legal immigrants over the age of 65. If you are over 65 and have worked for at least 10 years paying Medicare taxes then you qualify for premium-free Part A coverage.
If you are not eligible for premium-free coverage you can still buy part A coverage and pay the premium. Additionally, certain disabilities are eligible for part A coverage before the age of 65.
Benefits of Medicare Part A:
Generally Medicare Part A coverage includes:
- Hospital stays
- Nursing care
- Hospice
- Home-health care
Medicare Part A qualifies as minimum essential coverage. It satisfies the law that requires people to have health insurance.
To learn more, see our Medicare Part A guide.
Medicare Part B
Medicare part B is outpatient medical coverage. These include doctor’s visits, lab work, diabetic supplies, medical diagnostic tests, and other services. It is provided by the United States government to citizens and legal immigrants over the age of 65.
Benefits of Medicare Part B:
Medicare Part B covered services are;
- Doctor’s visits
- Emergency ambulance services
- Lab work
- X-rays
- Outpatient surgeries
- Preventive services
- Medical equipment
To learn more, see our Medicare Part B guide
Medicare Part C (Medicare Advantage)
Medicare Part C gives you an option to get the benefits of Medicare Part A and B through a private insurance company. When you enroll for Medicare Part C plan you get your health care services through a network of health professionals of the private insurance company. They offer all the benefits of Medicare Part A and B, plus additional services for a premium.
Additional benefits of Medicare Part C are:
- Vision
- Dental
- Hearing
Prescription drugs are covered separately in Medicare Part D but may be packaged with the purchase of a Medicare Advantage plan.
To learn more, see our Medicare Part C and Medicare Advantage plan guides.
Medicare Part D
Medicare Part D provides coverage for prescription drugs at significantly low prices. Original Medicare doesn’t cover most of your medications hence Part D acts as a supplemental plan with Medicare Part A and B.
Medicare Part D covers a wide range of prescription drugs taken at home. The drugs that are covered by Medicare Part D plan and their pricing are listed in the plan’s formulary, which you can request before purchase.
To learn more, see our Medicare Part D guide.
What is Medigap (Medicare Supplement)?
A Medicare Supplement Insurance or Medigap is a policy that you can buy from a private company, to pay the health care costs that are not covered by original Medicare.
You can buy a Medigap policy only if you have Medicare Part A and Medicare Part B. If you have Medicare Advantage or Medicare Part C plan then you are not eligible for Medigap. Medigap no longer covers for prescription drug policies that allow you to also have Medicare Part D, meaning that you will need to choose between Medigap and Medicare Part D.
Benefits of a Medigap plan:
- Routine vision or dental care
- Hearing aids
- Eyeglasses
- Private-duty nursing
Presently there are ten different types of Medigap plans, and each state approves a set of coverage options. These plans vary in their coverage, deductibles, and premiums. Choosing the right one can take a lot of research.
To learn more, see our Medigap guide.
Medicare Enrollment
Age 65 is the time when you become eligible for Medicare. But to receive the benefits of Medicare you need to enrol manually during their enrollment period. Medicare’s Annual Election Period which,also known as the Open Enrollment Period, happens each year from October 1st to December 7th. It’s during this time that millions of beneficiaries will make changes to existing coverage or sign up for new plans.
If you are a Medicare beneficiary, the Annual Election Period is an important time to pay close attention to changes in plans, including coverage and the premiums for the following year.
Important Facts About Open Enrollment
- When choosing your health coverage through Medicare, you should remember that Part A is hospital insurance and will protect you if you make a trip to the emergency room, or if you are admitted in hospital care or in a nursing facility.
- Part B medical coverage and is what you need when you are visiting the doctor’s office.
- Medicare Advantage plans, offered by private insurance companies, are another way to receive all the benefits of Part A and Part B. It may also provide some additional benefits, such as prescription drug coverage.
- If you are on medications due to certain health conditions, you’ll want to make sure to have Part D coverage, either through a Medicare Advantage plan that offers it, or a stand-alone Medicare Prescription Drug Plan.
- Each year, Medicare sends out a list of changes that are taking place to your current plan, including information about copayments and premiums for next year. The notice also compares benefits for next year. So it is important to consider any changes in your health conditions or needs. Insurers can change the drugs covered under Part D, procedures, rates, and even networks on a yearly basis.
- If you are not satisfied with the current plans or offerings, you always have the option of switching to another plan for the following year. You can join a Medicare Advantage or Part D plan for the first time, or unenroll from your current coverage and go back to vanilla Medicare.
- If you are satisfied with the current plan and want to keep the same coverage for the following year, then you don’t need to make any changes during open enrollment for Medicare.
Medicare late enrollment penalties
Medicare enrollment period begins three months before your 65th birthday and lasts until 3 months after you turn 65. If you don’t comply with this you will have to pay late enrollment penalty. To avoid any penalties you should enroll for Medicare during Initial Enrollment Period.
Warnings to Medicare Beneficiaries
With open enrollment season comes the possibility that you may run into fraud. If someone comes to your door and offers to sell you anything to do with Medicare, don’t let them in or accept any offers. They aren’t allowed to solicit business at your home if they don’t have an appointment with you. You should also refrain from giving out personal information such as your Social Security number, Medicare ID, bank account or credit card numbers.
Medicare Tips for Seniors
For seniors and other individuals looking to make changes during the Medicare Annual Election Period, here are some important tips to ensure that you don’t get confused about insurance requirements:
- The Annual Election Period opens on October 15th and closes on December 7th. If you choose to make plan alterations, your new coverage will begin on the 1st of January of the following year.
- Seniors should know that Medicare isn’t a part of the health insurance marketplace under the Affordable Care Act. If you have Medicare, then you’re covered under the new regulations and won’t be required to purchase a separate plan.
- Review your Annual Notice of Change and Evidence of Coverage during open enrollment to make sure the changes made to your current plans will not affect you negatively next year. If they do, you may want to go with a different plan, or if your health needs have changed and will no longer be met, you may need to find one that will suffice.
- Part B premiums generally change each year, with new premiums announced in the fall. This is the same for Part A premiums, you are required to pay one, as well as deductibles and other costs associated with Original Medicare. Knowing all of your Medicare costs will help you make better decisions about any additional coverage you may need.
- Beneficiaries with a Medicare Advantage plan may see changes in premiums, deductibles or copayments. There may also be changes in procedures, doctors and medical facilities that will be covered through your health insurance and some plans may even discontinue service. If this happens, you’ll want to be sure to shop around and find a plan that fits what you’re looking for in coverage. Understanding the details of each Medicare Advantage and determining which one will cover you the best is the most beneficial.
- If you only have Original Medicare, you likely need to get prescription drug coverage. If you don’t have any, you will have to pay a late enrollment penalty. You may want to consider enrolling in a Part D Prescription Drug Plan for this coverage and comparing plans during this time to make sure you have the right plan for your medication needs.
Conclusion
The Medicare program helps in better delivery of health care services. It plays a critical role in the financial security of older Americans. It is the best way to reduce out-of-pocket expenditure for older Americans.
Not Eligible for Medicare?
Medicare is generally only for available those who are 65 years of age or older, with some exceptions made for those with disabilities. Medicare recipients also must be citizens of the United States or legal residents.
If you are not currently eligible for Medicare, you still need health insurance. Please look at our guide for how to get health insurance