Your Simple Guide to Understanding Medicare

Are you approaching age sixty-five? Are you wondering how Medicare works?

Medicare offers convenient coverage and the opportunity for long-term savings. However, it’s critical that you know which parts you should sign up for, and which supplemental insurance may be a good idea.

Here’s what you need to know about understanding Medicare.

What Is Medicare?

Medicare is a federal health insurance program that provides affordable coverage for certain groups of people. These include those over the age of sixty-five, younger folks with disabilities, and individuals with end-stage renal disease.

Most Medicare subscribers don’t pay a premium for Medicare Part A. This section covers hospital stays, hospice care, and skilled nursing facility care. Part A may also pay for some home health care.

The other major part of Medicare is Part B. Everyone will pay a premium for it. In 2021, the average premium is $148.50

Medicare Part B covers things like doctor visits, outpatient services, and ambulance services. Part B supplies health care that can help prevent illnesses. 

You can also sign up for additional Medicare parts. These may cost more upfront, but many find they save them money in the long run.

Medicare Part D, for example, will help cover the cost of prescription drugs. You’ll need to weigh the cost of what you normally spend on prescriptions against the premiums for signing up for Part D.

Who Is Eligible?

Part A is free for those over age sixty-five when they meet certain qualifications. These include getting retirement benefits from Social Security.

You’re also eligible if you or your spouse is eligible to begin receiving benefits from Social Security or the Railroad Retirement Board but haven’t filed for them yet. In addition, you can sign up for Medicare if you or your spouse had government employment that was Medicare-covered.

If you’re over sixty-five but you or your spouse didn’t pay Medicare taxes while you worked, you might still be eligible. You will need to be a citizen or permanent resident of the United States, and you will need to purchase Part A.

How Do I Sign Up for Medicare?

If you’re already receiving Social Security benefits or benefits through the Railroad Retirement Board, you’ll automatically get signed up for Medicare parts A and B. This will also happen if you’re younger and have a disability.

If you aren’t getting Social Security, you can sign up for Medicare three months before the day you turn sixty-five. You can do this online at, over the phone, or in-person at your local Social Security office. 

You may need some documents that verify your citizenship, age, and work history. These could include your birth-certificate, W2’s, or a record of your earnings. 

You’ll also want to carefully consider the type of Medicare coverage you’ll need before you sign up. Make sure your research your options so you make the right decision for your needs and budget.

What Is Medicare Advantage?

Medicare Advantage Plans are also known as “Part C” or “All-in-One.” They are provided by private companies that have gotten approved by Medicare. Advantage Plans include Medicare Parts A and B, and some also include Part D. 

Medicare Advantage plans generally cover things that Medicare Parts A and B don’t. These include dental costs, vision needs, and hearing care. You may also receive coverage for fitness in the form of gym memberships or discounts.

If you’re interested in Medicare Advantage plans, you can do some research to determine the one that will end up being the most cost-effective. For example, you may be looking for financial assistance with over-the-counter drugs or transportation to the doctor’s office. Some packages are customized for patients with certain medical conditions.

Each Medicare Advantage plan is different in terms of out-of-pocket costs. They will also vary in the need for referrals to see specialists. Your plan may also require you to stay in-network for non-emergency visits.

Generally speaking, the Medicare Advantage plans that are the least costly will have more restrictions in terms of providers. The finer rules for your plan are also subject to change from year to year.

What Are Medigap Plans? 

Supplemental Medicare Insurance Plans are also known as “gap” plans because they’re designed to fill the gaps in original Medicare. Medigap plans can’t work with Medicare Advantage. If you’re interested in additional coverage, you’ll need to choose one or the other.

The best Medigap plan for you will depend upon your anticipated medical needs. If, for example, you plan on traveling overseas a lot in your retirement, you’ll want to choose a plan that will give you some coverage while you’re out of the country.

Medigap plans may cover things like copays, coinsurances, and deductibles. Your age, gender, and geographical location will influence the exact cost of your premiums. You can also expect your marital status, gender, and inflation to play a role.

The company you purchase your Medigap policy from needs to be licensed in your state to sell one. These policies only cover one person, so you and your spouse will need to purchase separate policies if you both want one.

Understanding Medicare

Medicare has several important parts, so understanding Medicare can seem a bit daunting at first. However, once you learn about basic plans and eligibility, choosing the right Medicare for you is simply a matter of knowing your needs and how different plans can meet them. You could be well on your way toward excellent medical care in no time.

Don’t stop getting smart about your health and finances now. For more great advice, read the rest of our blog today.

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