Medicare Basics

Medicare Basics

Once you’re eligible to sign up for Medicare (usually 3 months before you turn 65), you have 2 options:

  1. Sign up to get only Medicare coverage.
  2. Apply to start getting benefits from Social Security (or the Railroad Retirement Board). Once you’re approved to start getting benefits, you’ll automatically get Part A coverage. You’ll choose if you want Part B coverage when you apply for benefits.

Enroll in Medicare Part A/B online
https://secure.ssa.gov/iClaim/rib


As you approach the golden year of 65, discussions about Medicare can feel like you’re participating in a game of the $100,000 Pyramid. With endless clues and information being thrown at you to determine which Medicare option is best, you finally wish someone would just shout out the answer so you can move on!

Thankfully, we’re here to be candidly honest and get straight to the point as you customize a health insurance strategy that makes the most financial sense with your health goals in mind.

Simply put, Medicare has four parts: A, B, C, D … won’t you come and sing with me? All jokes aside, it really is ironic that the government references your options in an elementary fashion when they bury you with complex details that even the most educated have difficulty understanding.

A quick search on the Internet for Medicare will return pages and pages of resources you can turn to that spell out every minute detail you could want to know. But who has time for that? Rather, who wants to become an expert in Medicare when there are qualified people who have found a passion for doing it for you?

Our Medicare experts are trained and prepared to take the technical jargon that is Medicare and explain it to you as if you were speaking with a neighbor on a relaxed afternoon. You know, the kind of conversation you actually understand – and remember!

Part A

Part A is mandatory insurance that covers all your inpatient hospital services and post-hospitalization care, such as hospice or services received in long-term care facilities.
It carries a $0 premium for most Americans. This is government advertising at its best. Although it sounds like you’re getting something for free, you’ve actually been paying toward it with every employment check you’ve received, so the praise goes to you for handling your responsibilities all these years. That said, you are still responsible for out-of-pocket expenses such as copays, deductibles, and coinsurance.
If you’re already enjoying Social Security benefits at the age of 65, you’ll be automatically enrolled. If not, there are some options to consider based on your employment status and enrollment dates.
BOTTOM LINE: Part A may be the only Medicare component you are required to have, but it would be like wearing one leg in your pants all day long. It doesn’t make sense, and it certainly won’t fit the full scope of services you’re likely to need in the long run.

Part B

Part B will satisfy your outpatient primary care and select outpatient hospital services. This is your basic, routine care package – wellness checks, doctor’s visits, vaccinations, and other medically necessary services you will need. It’s the other pantleg needed to function normally and confidently as you move through life.

  • Part B is not free. You’ll need to budget for an annual deductible of around $200 as well as 20% of any Medicare-approved service you receive – mind you there is no maximum in play here, so you’ll pay 20% for the entirety of coverage. And yes, I know what you’re thinking. If it’s not approved, it’s not covered. To keep your wallet from losing too much weight, we’ll stress the importance of having up-front conversations with your practitioners to ensure they are recommending appropriate and covered treatment, and working with you to identify alternative cost-effective options in the event you fall into this category.
  • Like most health insurances, Part B will not cover your vision or dental services, or prescription costs if you can believe it. Despite the rabbit hole of insurance policies, you’re about to explore to fill these gaps of coverage, rest assured it’s very doable and everyone in your shoes is facing the same challenge.
  • Enrollment is also automatic for Part B if you’re receiving Social Security benefits at age 65. For those who aren’t, we’ll discuss your current situation to align you with the best enrollment date to prevent costly penalties.
  • BOTTOM LINE: Wear your pants correctly. Having Part A and Part B is the common-sense strategy that will cover you under the most medically necessary circumstances. And for the most part, as long as you remain healthy, it comes at a minimal cost. So, let’s dive into some other options if you know you’ll have medical issues to tend to down the road.

Part C

Part C was created to help you offset medical expenses through private insurance coverage. We like to refer to this as the “Prius” add-on. It’s economical, can get you further on your medical journey with lower costs, and it’s got some bells and whistles that Part A and Part B don’t offer. Others refer to it as Medicare Advantage. Under this option, you’re adding on private insurance that will help cover the costs of all services covered across each Medicare Part in addition to dental, vision, and urgent or emergency care services – imagine that!

  • The best benefit from Part C is the annual out-of-pocket maximum for services covered under Parts A and B. Currently, this amount is $7,550. Although it doesn’t apply to all medical needs, such as prescriptions, it will help bring some financial relief and help you more accurately budget your expenses for the year … if you’re into that sort of thing!
  • Private competition is one of the perks working toward your advantage. Insurance companies have more flexibility to incentivize you to choose their plan by lowering the maximum out-of-pocket expense or reducing premiums, but never forget that nothing is free. It’s usually a game of smoke and mirrors – a little may be taken off the front end, but you’ll likely find it stuck to the back. And there’s nothing wrong with that; we’ll just need to evaluate your financial needs to identify what makes the most sense for you.
  • But here’s the catch, you’re limited to the insurance carrier’s network of providers and the coverage benefits are not standard across all plans. Where you live will dictate your coverage area, benefit options, and premium costs. So while it sounds great on its face, depending on your medical needs, it may also be too restrictive to get you the care you require.
  • BOTTOM LINE: This is a good option to consider. Costs will vary, and you can still expect to pay premiums, deductibles, and copays, but the maximum ceiling on out-of-pocket expenses is a plus. That said, it’s important to note that there is an alternative option for private coverage out there that we feel is the “Cadillac” of all coverage. Medigap insurance policies offer much of the same, but they have little restrictions on the providers you can use and also offer competitive rates to give you the most bang for your buck.

Part D

Part D provides prescription drug coverage administered by private insurance companies.

  • What makes this option slightly different is that the government still regulates the deductible insurance companies are prohibited from exceeding.
  • Some of the benefits include market competition promoting consumer incentives, reasonable annual premiums, and generally low co-pays when picking up prescriptions.
  • If you already know your prescription needs, you can scan through Part D plans to see which offers you the best deal – we can also assist with this!
  • When it comes to prescriptions, Part D offers a tiered system for co-pay costs. Always be sure to discuss your medications with your provider to ensure there are no alternative, lower-cost options that could be considered.
  • BOTTOM LINE: Your pants are no good without a button and zipper. Part A and B are great for services received in a physician’s care, but you’ll need to continue supporting your health at home and Part D will ensure you have the means to do so without breaking your bank.

The continual cost of prescriptions can be difficult to manage, especially if you use many medications. Some pharmaceutical companies provide prescription assistance to low-income people and families. A doctor’s consent and confirmation of financial situation are usually required for these programs. They may also require that you have no health insurance or that your health insurance does not cover prescription drugs.

Get help with your prescription costs
https://www.ssa.gov/benefits/medicare/prescriptionhelp.html