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The Basics of Medicare

Medicare is a federal insurance program available to people 65 and older, though certain disabilities also allow for early Medicare eligibility. The different parts of Medicare cover specific services. It is important that you find coverage that is affordable and a good fit for your lifestyle. Trusted Medicare Answers provide simple and honest information regarding the options available to you.

Medicare Part AMedicare Part BMedicare Part CMedicare Part DMedicare Supplement Plans
medicare part a, african american woman looking outside from hospital bed, trusted medicare answers

Medicare Part A covers hospital and skilled nursing facility stays, hospice care, and some home health care costs. This is one of the two parts of Original Medicare. Most people get Part A for free (no premium) as long as they have worked at least 10 years and paid Medicare taxes. Even if you are entitled to free Part A, you still must enroll when first eligible.

What’s Good to Know:

  • If you aren’t entitled to receive Part A for free, and you don’t enroll when you’re first eligible, you may have to pay a late enrollment penalty.
  • Most people should enroll in part A when turning 65, even if you have health insurance through an employer. This is because your Part A is most likely free now, but you will incur late enrollment penalties if you wait.
  • If you’re not entitled to receive Part A for free, you can still enroll in Medicare A and B but will pay a premium.
  • Some people will get Medicare A and B automatically (without needing to enroll). In most cases, this is based on whether you’re getting benefits from Social Security or the Railroad Retirement Board. If so, you will get your Medicare information about 3 months before your 65th birthday.
medicare part b, doctor holding up stethoscope, trusted medicare answers

Medicare Part B helps to cover doctors’ appointments, as well as services, preventative and specialty services, outpatient care, home health care, and some medical equipment. This is the second part of “Original Medicare.”

What’s Good to Know:

  • It’s important to sign up for Part B when you’re first eligible. If you don’t, you’ll likely end up paying a late enrollment penalty for as long as you have Part B (unless your situation qualifies for a Special Enrollment Period). You may also have to wait until the General Enrollment Period to enroll and experience a gap in coverage.
  • Most people pay a monthly premium for Part B. The premium varies depending on your income and when you enroll in Part B.
  • Most people should enroll in Part A when they turn 65, but certain people may choose to delay Part B (for example, if they have insurance through an employer). In most cases, the reason for delaying depends on the type of health coverage you may have.

Private carriers offer Part C plans, also known as Medicare Advantage Plans, which offer all the benefits covered under Original Medicare (parts A and B) and more. You can select from HMOs, PPOs, Private Fee-for-Service, and Medicare Medical Savings Account (MSA) Plans. In order to join a Part C Plan, you need to be first enrolled Medicare Parts A and B.

What’s Good to Know:

  • Many Medicare Advantage plans include a Prescription Drug Coverage (Part D) Plan. These are sometimes referred to as “MA-PD’s.”
  • Many Advantage Plans also have hearing, vision and/or dental coverage.
  • Because many of these plans include Prescription Drug Coverage, you won’t need to enroll in a Part D plan.
  • Generally, you must see doctors within your plan network.
  • Costs for Medicare Advantage (Part C) Plans will vary by the plan.

There are pros and cons to both Original Medicare and a Medicare Advantage Plan depending on your unique health and financial situation. We want to help you make an informed decision.

medicare part c, medicare advantage plans, stack of blocks with health icons, trusted medicare answers

Medicare Part D is also known as a Prescription Drug Plan. It is a requirement for every Medicare-eligible person to have a Prescription Drug Plan, which can be purchased through private carriers. You can purchase a standalone Part D plan in addition to Original Medicare, or purchase a Part C plan, also known as a Medicare Advantage Plan, which could include a Part D Plan.

What’s Good to Know:

  • You may have to pay a late enrollment penalty if you decide not to join a Medicare drug plan when you’re first eligible AND you don’t have other creditable prescription drug coverage, OR if you don’t get Extra Help.
  • Some plans restrict you to doctors, specialists, and pharmacies within the plan network.
  • Most plans also include vision and dental benefits.
  • Your Part D insurance card is separate from a Medigap plan.
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Medigap plans, Medicare Supplement Plans, insurance agent going over medicare policy, trusted medicare answers

Medigap plans, also called Medicare Supplement Plans, or Med Supp, provide extra insurance that helps you pay your Medicare Parts A and B out-of-pocket costs – such as co-insurance and deductibles – which are “gaps” in medical coverage. Medigap plans are purchased through private carriers, though federal and state laws regulate the Medigap policies. Medigap policies are only available to people who already have Medicare Part A and B, and should be purchased during your Medigap Open Enrollment Period.

What’s Good to Know:

  • If you and your spouse both want a Medigap policy, you will each need to buy one.
  • Many medigap policies cover services used when travelling outside of the United States.
  • Generally, Medigap policies don’t cover long-term care (like care in a nursing home), vision or dental care, hearing aids, eyeglasses, or private duty nursing.
  • Usually, people who have a Medicare Advantage Plan (Plan C) or Medicaid cannot get a Medigap plan.

If you’re wondering whether a Medicare Advantage Plan or Medigap plan will save you more money, it simply depends on your situation. We want to help you make an informed decision.

Still have questions?

Medigap Open Enrollment Period

The Medigap Open Enrollment Period is a one-time 6-month period. This time frame begins the first month of your Medicare Part B coverage, and you’re 65 or older. Some states may have additional Open Enrollment rights under state law.

If you apply for a Medigap plan during this time, you are guaranteed acceptance and the plan can’t charge more based on your health conditions. To enroll in a Medigap plan, you must first be enrolled in Medicare Part A and Part B.

Certain Disabilities

If you have been receiving disability benefits from the Social Security Administration or the Railroad Retirement Board for 24 months, you automatically get Medicare Parts A and B.

Good to Know:

  • You will receive your Medicare card in the mail 3 months before your 25th month of disability.
  • You will need to enroll in a Medicare Part C or Medicare Part D plan in addition to the benefits you are receiving. Enrollment in these plans is only available during specific time frames.

Enrollment can begin 3 months before the 25th month of your disability, includes the 25th month of disability, and ends 3 months after your 25th month of disability benefits. For example, if you’re 25th month of disability benefits is May, you would be eligible to enroll in a Part C or Part D plan February 1 – August 31st.

Original Medicare

Medicare Part A and Medicare Part B are often referred to as “Original Medicare.” This government health coverage program is a fee-for-service plan, meaning you usually pay a fee for each service. Medicare will pay an approved amount up to certain limits, and you will pay the rest. The alternative to Original Medicare is a Medicare Advantage Plan (or Plan C) which is through private carriers that contract with the government.

Initial Enrollment Period (IEP)

The first time you can enroll is called your Initial Enrollment Period (IEP), which is a 7-month time frame. It begins 3 months before the month you turn 65, includes the month you turn 65, and ends 3 months after the month you turn 65. For example, if you’re 65th birthday was in the month of May, you would be eligible to enroll February 1 – August 31st.

Late Enrollment Penalties

Late penalties are added onto your Medicare monthly premium when you finally do enroll. Unfortunately, the penalties stay in force for as long as you continue to be enrolled in Medicare. The cost of the penalties will vary depending on the situation.

Special Enrollment Period (SEP)

A Special Enrollment Period (SEP) allows you to enroll in Medicare plans outside of your Initial Enrollment Period (IEP) and the General Enrollment Period (GEP).

General Enrollment Period (GEP)

The General Enrollment Period (GEP) is for Medicare-eligible individuals who did not sign up during their Initial Enrollment Period (IEP) which is based on birthdate. The General Enrollment Period is from January 1 – March 31st every year. Coverage for individuals who enroll during the GEP will begin on July 1st of that year.

Unfortunately, most individuals who miss the IEP and sign up during the General Enrollment Period will face late-enrollment penalties.

Medicare Medical Savings Account (MSA) Plans

Private insurance companies can offer a consumer-directed Medicare Advantage Plan, called an MSA Plan. These plans combine a high-deductible insurance plan with a medical savings account that you can use to pay for your health care costs. In these plans, you can generally choose your health care services and providers.

Medicare Medical Savings Account (MSA) Plans

Private insurance companies can offer a consumer-directed Medicare Advantage Plan, called an MSA Plan. These plans combine a high-deductible insurance plan with a medical savings account that you can use to pay for your health care costs. In these plans, you can generally choose your health care services and providers.

Extra Help

The “Extra Help” program can help individuals with limited income pay costs of a Prescription Drug Plan, also known as Medicare Part D. These costs can include premiums, deductibles, and coinsurance.

Creditable Prescription Drug Coverage

This is other prescription drug coverage (such as those from an employer or union) that’s expected to pay, on average, at least as much as Medicare’s standard prescription drug coverage. People who have this kind of coverage when they become eligible for Medicare can usually enroll in Medicare prescription drug coverage later without penalties.

Medicaid

Medicaid is a state-funded healthcare program available for low-income adults. It’s possible to be eligible for both Medicare and Medicaid, (known as “dual eligibility”) and they will work together to provide coverage at a very low cost.