Eligibility ⌾ Coverage ⌾ Cost ⌾ Enrollment
Medicare can be confusing and frustrating. Make Medicare Work is here to help you understand your options, avoid penalties, and pick the best plan for your health needs and budget.
Let start with the basics...
Medicare Initial Enrollment Period (IEP)
Your Initial Enrollment Period is probable the most important date to keep track of as you approaching Medicare Eligibility.
"Late Enrollment" will have you paying a Life Long Penalty
You are first eligible to sign up for Medicare during your Initial Enrollment Period.
Your Initial Enrollment Period starts 3 months before and ends 3 months after you turn 65.
Parts of Medicare
Coverage ⌾ Cost ⌾ Enrollment
Medicare is the federal health insurance program for people who are 65 or older, and younger individuals with disabilities and certain illnesses. There are four parts to Medicare. Parts A and B are the original Medicare.
Parts A— is hospital care. Think of this as your room and board coverage for hospitalization.
Expand to learn more about Part A
You may be surprised to learn that Medicare is not free and it does not cover 100% of your medical care.
MEDICARE PART A COVERAGE
Think of this as your room and board coverage for hospitalization.
Inpatient care in hospitals (such as critical care hospitals, inpatient rehabilitation facilities, and long-term care hospitals)
Inpatient care in a skilled nursing facility (not custodial or long-term care)
Hospice care services
Home health care services
MEDICARE PART A COSTS
You usually don’t pay a monthly premium for Part A coverage if you or your spouse worked for at least 10 years and paid Medicare taxes.
If you are not eligible for premium-free Part A, you may be able to buy Part A if you meet one of the following conditions:
You are age 65 or older, and you are entitled to (or enrolling in) Part B and meet the citizenship or residency requirements.
You are disabled and your premium-free Part A coverage ended because you returned to work.
In most cases, if you choose to buy Part A, you must also have Part B and pay monthly premiums for both. If you have limited income and resources, your state may help you pay for Part A and/or Part B.
MEDICARE PART A COST-SHARING
Your Medicare Part A coverage will pay for a great deal. However, you will have some cost-sharing as well, that you are responsible for.
Each year CMS (Center for Medicare) determines the Medicare Part A deductible and coinsurance that you will be responsible for during the following year. These are the cost-sharing amounts that you must pay when using your Part A benefits.
In 2018, you will pay:
Deductible $1340 for each inpatient hospital stay days 1-60
$335 per day for days 61 – 90 of a consecutive hospital stay
$670 per day for days 91 – 150 of a consecutive hospital stay
Any and all costs after reaching the lifetime maximum.
For skilled nursing facility stays, Medicare covers the first 20 days.
Your daily copay in 2018 for days 21- 100 will be $167.50.
Part B—provides medical insurance. Medigap coverage, is supplemental insurance available to help cover the gaps left by Parts A and B.
Expand to learn more about Part B
In 2018, the base rate Part B is $134/month for people new to Medicare. Premiums vary depending on income. Higher income earners pay more for Part B.
MEDICARE PART B COVERAGE
Medicare Part B helps cover medically-necessary services like:
- Doctors' services
- Outpatient care
- Home health services
- Other medical services
Part B also covers some preventive services.
Some people turning 65 still have health insurance through an employer. If this is you, you may be able to delay enrollment into Part B in favor of their group health insurance.
It’s important to understand if your plan provides for a qualified waiver and the special election periods that you must use later on to avoid a late enrollment penalty. Or, you may decide in favor of Medicare after a through comparison of requirements, benefits and budgets.
MEDICARE PART B ENROLLMENT
As we discussed previously, your initial enrollment is three months before, the month of and three months following your 65 birth month. If you didn’t sign up for Part B when you first became eligible, you may be able to sign up during one of these times:
General Enrollment Period
Between January 1 - March 31 each year. Your coverage will begin July 1. You may have to pay a higher premium for late enrollment.
If you do not sign up for Part B when you are first eligible, you may have to pay a late enrollment penalty for as long as you have Medicare. Your monthly premium for Part B may go up 10% for each full 12-month period that you could have had Part B, but didn’t sign up for it. Usually, you don’t pay a late enrollment penalty if you sign up for Part B during a special enrollment period.
Special Enrollment Period
If you or your spouse (or family member if you are disabled) is currently working, and you are covered by a group health plan through the employer or union that is terminating your coverage.
MEDICARE PART B COSTS
Many folks do not realize that unless covered by MediCal (Medicaid), everyone pays a part B premium. The majority of Americans pay the standard monthly amount set by the government.
MEDICARE PART B COST-SHARING
You will pay a percentage of the costs of your medically-necessary Part B services. Generally, these costs are:
- The annual Medicare Part B deductible ($183 for the 2018 year)
- 20% of the remaining costs, with no limits or cap
- Any excess charges that a provider or facility may charge beyond what Medicare reimburses
Although Medicare helps pay for key health care, hospitalization (Part A) physician visits, labs etc., it does not pay for 100%. Between the deductible and 20% copay, the out of pocket costs could certainly build up quickly. Bear in mind that Traditional or Original Medicare does not provide some of the health benefits most of us will need – vision, hearing aids, and dental care are some general examples.
Now that your familiar with the basics and you can now see where you might incur significant costs with just Basic Medicare were going discuss the various options you have.
Expand to learn more about Medi-Gap
Medigap is supplemental insurance designed to work with Original Medicare (Part A & Part B) as a secondary payer and each plan is regulated as to what it covers. They are designed to help pay your cost share of Medicare. (Remember the deductible and the 20% coinsurance we discussed earlier?) Currently there are 10 different plan designs approved by Medicare (Plan A, B, C, D, F, G, K, L, M & N). Each plan is standardized across all insures, this means the true difference is the monthly premium cost.
MEDICARE SUPPLEMENT PLANS COST
The out-of-pocket costs for a Medicare Supplement Plan will vary and depend on the following:
- The plan designs monthly premium ( this you pay in addition to your Part B premium).
- Whether the plan has a yearly deductibles
- How much you pay for each visit or service (co-payments).
- Whether the plan has a yearly limit on your out-of-pocket costs for all medical services.
Not every insurance carrier offer each of the 10 plan designs in all areas. In addition some plans offer some enhanced benefits, however currently Medicare Supplement plans DO NOT include prescription drug coverage. You’ll need to purchase drug coverage separately.
Warning!! You may NOT enroll in a Medicare Health Plan ( Part C) and a Medicare Supplement plan.
Part C—Is private insurance that works as an alternative to the original Medicare. Known as Medicare Advantage, it provides coverage for Parts A and B and may offer additional care benefits such as dental, vision and prescription drug coverage. You may also be able to find plans that offer lower cost-sharing.
Expand to learn more about Part C
Medicare Health Plans, sometimes called “Part C” or “Medicare Advantage Plans,” are offered by private companies under contract with Medicare. These plans often look and feel typical to your previous health insurance experiences. Most plans are managed care and cover most aspects of your health care with in one network and one plan, basically incorporating Part A, Part B and usually Part D coverages.
Usually these plans have local provider networks, low to no cost premiums, fixed co-pays, a set out of pocket annual spend limit for health care.
Many include coverage for health benefits not covered by Original Medicare, hearing aids, vision even acupuncture and gym memberships.
MEDICARE ADVANTAGE COST
The out-of-pocket costs for a Medicare Advantage Plan vary widely, and depend on the following:
- Whether the plan charges a monthly premium in addition to your Part B premium.
- Whether the plan pays any of the monthly Part B premiums.
- Whether the plan has a yearly deductible or any additional deductibles.
- How much you pay for each visit or service (co-payments).
- What the plans yearly limit on out-of-pocket costs is.
Your Medicare Advantage plan premium may also include all or part of the premium for Medicare prescription drug coverage (Part D).
MEDICARE PART C ENROLLMENT
You can generally join a Medicare Advantage Plan if you meet these conditions:
- You have Part A and Part B.
- You live in the service area of the plan. Contact the plans you're interested in to find out about the service area.
- You don't have End-Stage Renal Disease (ESRD) (permanent kidney failure requiring dialysis or a kidney transplant). A few exceptions apply for ESRD. For more information call TTY users should call 1-877-486-2048, 24 hours a day/7 days a week.
You're a U.S. citizen or lawfully present in the United States.
JOIN, SWITCH, OR DROP A MEDICARE ADVANTAGE PLAN
You can join, switch, or drop a Medicare Advantage Plan at these times:
- When you first become eligible for Medicare (the 7-month period begins 3 months before the month you turn age 65, includes the month you turn age 65, and ends 3 months after the month you turn age 65).
- If you get Medicare due to a disability, you can join during the 3 months before to 3 months after your 25th month of disability. You will have another chance to join 3 months before the month you turn age 65 to 3 months after the month you turn age 65.
- During the Annual Election Period between October 15-December 7. Your coverage will begin on January 1 of the following year, as long as the plan gets your enrollment request by December 31.
Part D—Is optional prescription drug coverage provided by private insurers. This helps with the cost of paying for prescription drugs.
Expand to learn more about Part D
You are eligible for Medicare Part D as long as you are actively enrolled in either Part A and/or eligible for Part B.
You must also live in the Part D plan’s service area.
Enrollment is considered optional (though recommended to avoid incurring penalties) and enrollment is only allowed during approved enrollment periods.
Typically, you should sign up for Part D when you first become eligible to enroll in Medicare.
Whether you should sign up for a Medicare Part D plan depends on your circumstances. If you have no other drug coverage or have chosen a Medicare option that does not include prescription drug coverage, our recommendation is to sing up when first eligible.
Medicare Part D provides your insurance against future catastrophic medication costs. It will also help give you lower copays on medications you take now.
You can join or switch, Medicare Drug Plan?
Enrollment generally follows the same guidelines as Part C Medicare Advantage Plans.
When you first become eligible for Medicare (the 7-month period begins 3 months before the month you turn age 65, includes the month you turn age 65, and ends 3 months after the month you turn age 65).
If you get Medicare due to a disability, you can join during the 3 months before to 3 months after your 25th month of disability. You will have another chance to join 3 months before the month you turn age 65 to 3 months after the month you turn age 65.
During the Annual Election Period between October 15-December 7. Your coverage will begin on January 1 of the following year, as long as the plan gets your enrollment request by December 31.
If you enroll in a Medicare Health Plan ( Part C) that includes Part D drug coverage you will NOT need to enroll in a separate Part D Drug Plan.
Warning!! If your enrolled in a Medicare Health Plan ( Part C) and you then you enroll in a Part D ( stand-alone Prescription drug plan) you will be automatically dis-enrolled from your Medicare Health Plan ( Part C) and be returned to Original Medicare. You may or may not qualify for a Medicare Supplement plan, so be careful.
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Hi, I’m Denise Anderson
I am a mother, a daughter and a caregiver. I believe in treating others as you want to be treated. In our agency everyone is treated like family.
I’m the Managing Broker at Make Medicare Work (a division of J. Johnston Ins. Svc, Inc.) and a Medicare Supplement Accredited Advisor.
My agency has helped thousands of Medicare beneficiaries properly enroll in Medicare and understand their benefits options at no charge. Collectively, my team has nearly 100 years of experience.
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