5 Things You May Not Know About Medicare

During this unprecedented and distressing time, it is important to do our best to remain confident and optimistic for the future. Which means still planning ahead for things like retirement. If you have not yet enrolled in Medicare or begun exploring your coverage options, you may not know much about Medicare other than it is the federal health insurance program for people age 65 or older. Although this is important to know, here are five additional things for you to be aware of.

1. Assembly may be required.

Unlike regular health insurance that comes neatly assembled, Medicare may require assembly depending on what you choose.

Original Medicare has two parts that can combine with other insurance to form the coverage you want. The first part, known as Part A, is hospital insurance and helps pay for things like, inpatient care, skilled nursing facility care, hospice care, and home health care. The second part, known as Part B, is medical insurance and helps pay for things such as doctor services, outpatient care, and other preventative services.

Since Part A and B do not cover the full cost of health care services, you may also consider purchasing a Medicare Supplemental Insurance policy, also known as Medigap policy, from a private insurance company. If you are newly eligible for Medicare, you may have up to eight standardized Medigap policies to choose from.
Another part of Medicare, known as Part D, helps pay for prescription drugs and can be purchased from private insurance companies.

If you prefer to not assemble your coverage, Medicare Advantage plans, known as Part C, are also an option. Advantage plans include both Part A and B as well as frequently prescription drug coverage. These plans are offered by private companies and will generally require you to use the health care providers in the plan’s network.
There is a lot to consider when selecting your Medicare coverage, which is why it is important to begin exploring your options before your 65th birthday.

2. Medicare is not free.

Although it may give you the impression that Medicare is free, there are monthly premiums for all parts of Medicare, except for Part A, which is usually premium-free if you or your spouse worked and paid Medicare taxes for at least 10 years. Generally, there are also deductibles, coinsurance, and copayments for some of the services you receive. A Medigap policy (for which you will also pay a monthly premium) can help cover some of these costs.

3. Medicare Advantage plans may offer extra benefits.

These plans may cover routine eye exams for prescribing glasses, hearing aids, dental care and dentures, as well as services that may not typically be covered in Original Medicare. Some Advantage plans even offer gym memberships and other fitness benefits.

4. Medicare does not cover long-term care services.

Medicare will typically not cover long-term care services, such as help with eating, bathing, or dressing, if that is the only type of care that you need. Most people use personal income and savings, long-term care insurance or certain life insurance policies to cover their long-term care.

5. Enrolling late can cost you.

Most people are eligible for Medicare at age 65 and if you don’t enroll when you are first eligible, you may have to pay a late enrollment penalty. You may be able to enroll in Medicare without penalty, if you (or your spouse) are still employed and you have group health insurance from an employer or union based on that employment. Check with your benefits administrator before your 65th birthday to find out how your current health insurance works with Medicare and what steps you may need to take to avoid any penalties in the future.

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Article published in March 2020 edition of Eye on Money. If you would like to be added to our mail list please email jennifer@dh-cpa.com