Medicare 101


Medicare » Medicare 101

Making Sense of Medicare

Are you about to turn 65, or did you recently celebrate this milestone birthday?

If so, you have probably received promotional mailers – possibly many of them – about signing up for Medicare. It is because you are now eligible for coverage, or you will soon be eligible.

What is Medicare?

Medicare is federal health insurance. It is primarily for America’s seniors, but also some people under age 65 with certain disabilities and those of any age with end stage renal disease (ESRD). The Centers for Medicare & Medicaid Services administers the program, while the Social Security Administration (SSA) enrolls most individuals.*

Make no mistake – Medicare is complicated.

It has parts and plans that look like alphabet soup, and there are a variety of policy combinations, eligibility guidelines and enrollment periods.

We hope to remove any confusion you may have about Medicare by breaking down the different options and explaining them in detail. Our goal is to provide the information you need to make the choices that are right for you.

*The nation’s railroad workers pay Medicare taxes to the federal railroad administrative system rather than the SSA. These workers and their dependents are enrolled in Medicare through the U.S. Railroad Retirement Board.

Original Medicare

This is the program’s foundation. While it offers significant benefits, Original Medicare does not pay all of a covered person’s health care costs. (More on that later.)

Medicare has four parts:

  • Hospital Coverage
  • Medical Coverage
  • Medicare Advantage Plans
  • Prescription Drug Plan

Part A

Also referred to as Hospital Coverage, Part A is free to people who have worked 10 years or more and paid Medicare taxes. Otherwise, you can sign up for Part A at a cost.

There are premiums, copays and coinsurance costs. If you collect Social Security or Railroad Retirement benefits, you will be automatically enrolled when you turn 65. If you were eligible for Part A for two years but did not sign up, you will have to pay the higher premium for four years.

Usually you do not have to pay a penalty if you meet certain conditions that allow you to sign up for Part A during a Special Enrollment Period (SEP).

Part A includes:

  • Hospital stays
  • Skilled nursing facility
  • Home health care
  • Hospice

Generally, people receive their Medicare initial enrollment package three months before their 65th birthday. Included in the package is your red, white and blue Medicare benefits card.

If you choose to accept the required Part A and the optional Part B Medical Coverage, you keep the Medicare card. If not, you return it to indicate you have declined Part B.

Part B

Also part of Original Medicare, Part B medical coverage may be similar to the health insurance you or a loved one may have had while working.

You can decline Part B if you are still working and have group insurance coverage. However, we strongly suggest you review Part B benefits before choosing to decline them.

Part B includes:

  • Doctor visits
  • Preventative services
  • Outpatient medical and surgical services and supplies
  • Lab tests
  • Durable medical equipment
  • Diabetic testing supplies

Part B

Also part of Original Medicare, Part B medical coverage may be similar to the health insurance you or a loved one may have had while working.
You can decline Part B if you are still working and have group insurance coverage. However, we strongly suggest you review Part B benefits before choosing to decline them.

Part B includes:

  • Doctor visits
  • Preventative services
  • Outpatient medical and surgical services and supplies
  • Lab tests
  • Durable medical equipment
  • Diabetic testing supplies

Part C

This refers to Medicare Advantage (MA) Plans. You can enroll in an MA plan if you have chosen Original Medicare Parts A and B.
Private insurance companies approved by Medicare offer Medicare Advantage plans. The plans are required to have everything covered under Original Medicare, Part A and Part B, with the exception of hospice care. Some plans offer additional benefits, such as prescription drug coverage, dental, and vision.

In addition:

  • Some have a network you must use
  • You may need a referral to see a specialist
  • Members must continue to pay their Part B premium
  • You can only join (or leave) the plan during certain periods

Part C

This refers to Medicare Advantage (MA) Plans. You can enroll in an MA plan if you have chosen Original Medicare Parts A and B.

Private insurance companies approved by Medicare offer Medicare Advantage plans. The plans are required to have everything covered under Original Medicare, Part A and Part B, with the exception of hospice care. Some plans offer additional benefits, such as prescription drug coverage, dental, and vision.

In addition:

  • Some have a network you must use
  • You may need a referral to see a specialist
  • Members must continue to pay their Part B premium
  • You can only join (or leave) the plan during certain periods

Part D

Medicare’s Prescription Drug Plan (PDP) program – Part D – is optional. However, if you delay enrolling in a Medicare PDP, you may be charged a late enrollment penalty if you decide you want it later.

Criteria for joining a Prescription Drug Program are:

  • Must have Part A and Part B coverage
  • Live in the plan service area
  • Live within the United States

Enrollment periods include:

  • Your Initial Enrollment Period (IEP).

This is a seven-month period including the three months before your 65th birthday, your birthday month and the three months following your birthday.

  • The Medicare Annual Election Period (AEP), which is Oct. 15 through Dec. 7 each year
  • Special Election Period (SEP)

Prescription Drug Plan coverage is also available to you as a stand-alone Part D plan, which can be added to your Original Medicare coverage. Learn more

Part D

Medicare’s Prescription Drug Plan (PDP) program – Part D – is optional. However, if you delay enrolling in a Medicare PDP, you may be charged a late enrollment penalty if you decide you want it later.

Criteria for joining a Prescription Drug Program are:

  • Must have Part A and Part B coverage
  • Live in the plan service area
  • Live within the United States

Enrollment periods include:

  • Your Initial Enrollment Period (IEP).

This is a seven-month period including the three months before your 65th birthday, your birthday month and the three months following your birthday.

  • The Medicare Annual Election Period (AEP), which is Oct. 15 through Dec. 7 each year
  • Special Election Period (SEP)

Prescription Drug Plan coverage is also available to you as a stand-alone Part D plan, which can be added to your Original Medicare coverage. Learn more

Medicare Supplement Insurance

If you hear someone mention Medigap (or Med Supp), these nicknames refer to Medicare Supplement policies.

Private companies sell Medicare Supplement insurance; its purpose is to fill gaps in Original Medicare coverage.

Medicare Supplement insurance offers standardized plans. However, plan premiums vary by company, plan type and location.

More details:

  • Open Enrollment Period for a Medigap plan begins the month you turn 65 and enrolled in Part B
  • Enrollment period is six months long
  • Companies must sell you a policy within the Open Enrollment Period (OEP)
  • Restrictions apply to policies sold outside of the OEP

Get the facts

There is a LOT of information about Medicare available from various sources.

Because AmeriLife has served the health insurance needs of seniors for nearly 50 years, we suggest you start with Medicare & You 2018, the official U.S. government Medicare handbook.

It is available in hard copy, downloadable PDF format and for viewing on smart phones and other mobile devices, including eReaders such as Kindle and Nook.

The handbook contains a checklist to help you maximize your coverage; a chart depicting the two main coverage choices; a summary of what Medicare covers and what it does not cover; definitions of commonly used terms; State Health Insurance Assistance Program (SHIP) contact phone numbers; and your rights under the program.

Where to go for help

If you are new to Medicare or in need of assistance, we recommend you either visit the Medicare website or contact the Centers for Medicare and Medicaid Services at 1-800-MEDICARE (1-800-633-4227).

Interpreters are available to provide information and answer questions in numerous languages, and at no cost.

TTY users can may call 1-877-486-2048 for assistance.

Because AmeriLife has worked in the senior market since 1971, we have considerable experience with the Medicare program.

One of our representatives can sit down with you to review your options and help you make the best decision for your needs.

 

Connect with an Agent

A licensed sales representative may contact you to listen to your needs.

Connect with an agent



error: Alert: Content is protected !!