Getting older comes with wisdom and knowledge, but that doesn’t mean there aren’t new things to learn! When you turn 65, one of the new things you need to learn is Medicare, and unfortunately, it isn’t easy.
“Deciding on which parts of Medicare to enroll in, and which separate coverages to purchase outside of Medicare, can be intimidating.” That’s why Insurance Lounge recommends reaching out to a professional insurance broker when you enter the wild world of Medicare.
Before you make that call, a little research can go a long way. Here are a few things you need to know so you can have an informed, knowledgeable conversation about your Medicare options with a professional.
You May Have to Enroll on Your Own
In some cases, you may be automatically enrolled in Medicare. That makes getting coverage easy, even if it doesn’t mean you understand the coverage you’re getting.
However, you may not be automatically enrolled, and making the mistake of thinking that you will be can have disastrous consequences.
You will only be enrolled automatically if you happen to be taking Social Security benefits when you turn 65. If you are waiting to withdraw your benefits, you will not be automatically enrolled. That means you have to reach out and enroll yourself.
To complicate matters, there are different pieces to Medicare. Even if you are automatically enrolled in Part A and Part B, you will still have to enroll yourself in Part D. If you don’t, you could experience a gap in your coverage, and you could face hefty fines.
You Can Only Enroll at Certain Times
Not only is it confusing to determine if you have to enroll, and what parts you have to enroll in, you also have to know when you can enroll.
The obvious answer is when you turn 65, but it’s a little more complex than that. The good news is that you can sign up as many as 3 months before your birth month and 3 months after your birth month. Including your birth month, you have 7 months to get the job done.
If you are still covered by an employer, you don’t have to sign up for Medicare when you turn 65, but you will have to sign up as soon as your coverage ends if you want to avoid penalties.
There is also an open enrollment period in the fall where you can sign up for Medicare, or you can switch your plan.
There’s a Lot of Lingo to Learn
The world of Medicare comes with its own language—language that is confusing. One of the best things you can do when you turn 65 is to get yourself acquainted with common Medicare terms.
A few that will help you get started include:
- Medicare Part A is part of the traditional Medicare program that covers inpatient hospital services, skilled nursing home care, and hospice.
- Medicare Part B is part of the traditional Medicare program that covers preventative care and outpatient services.
- Medicare Part D includes private insurance plans that cover the cost of prescription drugs.
- Medicare Advantage, or Medicare Part C, is an alternative that offers coverage that is more similar to private insurance plans.
- Medigap Plans are supplemental insurance plans that help pay for some out-of-pocket costs.
In addition, you should also refresh yourself on more general insurance terms like copayments, coinsurance, and deductibles.
It Isn’t Free
Think Medicare is free? Think again! Many older Americans are surprised to discover that they will continue to pay for health care benefits with a Medicare plan.
Fortunately, it’s nothing compared to how much you’re probably used to paying for private insurance or a company plan.
Part A coverage comes with no monthly premium, as long as you or a spouse paid for 40 quarters of Medicare on their taxes. If you didn’t, you could end up paying over $400 per month. Whether you pay for your coverage or not, you’ll still be responsible for deductibles and coinsurance when you use your coverage.
Everyone pays a premium for Part B coverage, which pays for doctor visits and outpatient procedures. Everyone pays a flat fee, plus additional, depending on your income.
Part D covers prescription drugs, and it costs extra too. How much extra will depend on what kind of plan you choose.
It May Not Cover You Where You Need It
Not only do people assume Medicare is free, they also assume that it covers everything. It doesn’t.
Medicare doesn’t cover:
- Most dental care
- Eye exams
- Hearing aids
- Cosmetic surgery
- Long-term care
That’s in addition to leaving you with steep fees for hospital stays and medication.
If you want more comprehensive coverage, you’ll have to pay extra for it. Additional plans can be purchased that can help you fill in the gaps left in a Medicare plan.
There’s More to Consider Than Just Price
Most seniors are on a fixed budget, which means the cost of any additional Medicare coverage plan is extremely important. Although you may be tempted to sign up for the cheapest plan you can find, there are many other things you should consider when choosing a Medicare plan.
For example, if you are taking medication to deal with one or more medical issues, it’s not a good idea to pay for the cheapest Part D plan. You may not save enough on the cost of your prescriptions to make it worth it.
You also have to consider the provider. Before you sign up for a plan, read reviews online so you choose a provider with a history of good customer service. You’ll also want to find one that has been around for a while, so the company doesn’t go under, leaving you without coverage.
Getting older should come with increased freedom. Don’t let Medicare make you feel like you’re chained to coverage you don’t understand! As soon as you turn 65, put in the time to understand how Medicare works so you can age with confidence.