If you’re turning 65 soon (or have just reached that milestone), it’s probably time for you to sign up for Medicare, the healthcare program for Americans 65 and older. You’ve probably heard someone talk about Medicare Part A, Part B, Medicare Advantage, and maybe other alternatives, and it can be confusing. How do you know which one you should sign up for, and when?
Let’s break it down into a few steps that might be easier to understand.
When Do I Sign Up?
Most are required to sign up initially for Medicare in the year they reach age 65. The enrollment period begins 3 months before your 65th birthday and ends 3 months after. If you fail to enroll during your allotted period, you may be subject to penalties when you enroll later (the exception is those who are still working at age 65 or older and are covered under a major employer’s healthcare plan). You can sign up for free online by visiting Medicare.gov.
What Coverage Do I Need?
There are several parts to Medicare, and each one provides coverage for a different range of healthcare services.
- Part A (“Original Medicare”) is administered by the federal government and covers most hospital costs.
- Part B (“Original Medicare”) is administered by the federal government and covers outpatient care (like doctor office visits) and preventative care.
- Part C (Medicare Advantage) is offered by private insurance companies approved by Medicare and covers many of the same services as Parts A and B, along with prescription drug coverage. In many ways, it is similar to an HMO; you must use providers that are in-network, and some plans require a referral. Some plans cover vision, dental, hearing, and even gym memberships. It’s important to compare these plans carefully, as costs and benefits can vary.
- Part D covers prescription drugs and is offered by private insurance companies approved by Medicare. There are many plans to choose from. Some require no cost and others are more expensive. It is important to research these options with the medications you take today. For example, you will want to find out if the plan covers generic versus brand-name prescriptions.
You may also decide to apply for “Medigap” coverage, which can help with copayments, deductibles, and co-insurance. Medigap coverage is optional, and there are many choices. In traditional corporate medical plans there is usually a limit to the amount that you can spend before insurance begins paying 100%. This is not true with Original Medicare. You pay 20% of all expenses with no limitation. That is why Medigap is recommended. For example, let’s say your medical bill is $500; you will have to pay 20%, or $100. But if you have Medigap, it will pay that $100, subject to deductibles. Remember, the amount you pay for Medigap coverage depends on the plan you choose.
If you live in different locations in different parts of the year, Original Medicare, combined with Medigap, may be a good choice, since you can use any provider who accepts Original Medicare. You also don’t need a referral from a primary care physician unless it is required by the physician you are seeing.
On the other hand, if you spend most of your time in the same place, Medicare Advantage plus Medigap may make more sense and perhaps be less expensive. As long as your provider is in-network with your Medicare Advantage plan, your coverage should be in place.
For more information, please visit https://www.medicare.gov.
