Signing up for Medicare is not difficult most Americans will be automatically enrolled upon approaching the age of 65. The main problem that many face is understanding what benefits are available to them and where to get started learning about these benefits. A lot of people wing it and only look into their Medicare coverage when situations arise. Similar to how many people pick employer insurance options. During your retirement years, you have more choices to choose from and more control over how you save money and where you put your money to get the most out of the benefits provided.
Because there is so much information surrounding medical care, benefits, and the Medicare system itself; many people get overwhelmed and don't fully explore what options are available to them. And how with the right coverage in place you can really save more than you spend, get the benefits more focused on you, and add some extras to fit your lifestyle.
I have been guiding Americans who have enrolled in Medicare since 2018, and have hundreds of clients who now understand more about their options, what Medicare insurance plans work together, and what supplemental benefits can be used to enhance the benefits afforded to you through the Medicare program. As a broker, I have a duty to put the needs of my clients first and explain the details of different plans and how they work together. In this post, I want to express how important it is for you to set up your Medicare coverage in a way that you can maximize your benefits, and keep your costs as low as possible for your given situation. But let's start with a brief overview of the basics.
Medicare Enrollment Period
Medicare enrollment periods vary from person to person depending on their personal situation. For most Americans, a beneficiary, or rather a person who is eligible for Medicare, will be automatically enrolled upon approaching the age of 65. But there are times in which you won't get automatically enrolled, such as if you don't have enough working quarters, or you are still working and have qualified medical insurance through an employer, more on that later. People under 65 with certain disabilities, one of which is end-stage renal disease (ESRD), may be eligible by meeting certain criteria. For now, let's stick to the basics and keep it simple.
When you are automatically enrolled, usually 3 months before your 65th birthday, in Medicare it is called Original Medicare. Original Medicare comes in two parts. You have your Part A, which is your hospital insurance, and your Part B which is medical insurance we will get into the details next, but one thing I advise my clients on is making sure you use your benefits that have been afforded to you through Original Medicare.
Original Medicare has a lot involved with preventive healthcare, meaning taking care of yourself before you get sick or injured to lessen the likelihood of the severity of the event. Many of these measures can be used with minimum to no cost to you. A lot of the information you need can be found on Medicare.gov, but if you want to talk to a live person you can call 1-800-MEDICARE (but be prepared to understand that either method will take some time, so have your questions written down and prepare to spend at least an hour and a half speaking with someone). But understand that this is just the first leg of your journey, there are some things that you can do to help your finances for the long haul and I will touch on these as they come.
What is Medicare Advantage?
Medicare Part C or Medicare Advantage are offered by private companies approved by Medicare. Many of these plans offer benefits you can't get through Original Medicare and premiums are lower than that of Medicare Supplements. It is important to understand that Medicare Supplements (Medigap) are not the same as a Medicare Advantage plan, nor are they Original Medicare.
Medicare Advantage plans are an alternative to Original Medicare and can offer prescription drug coverage, have a maximum out of pocket and some come with limited deductibles and some have no deductibles at all. Even with a Medicare Advantage plan you will still be responsible for your Part B premium. The benefits available to you depend on the service area and what plans are offered in your area. There are even plans available for those who receive both Medicare and Medicaid, these plans are known as Dual-eligible plans. If you are dual eligible your Part B premium can be greatly reduced so make sure that you communicate with your local Social Security Administration office if you believe that you may qualify for both Medicare and Medicaid.
In most cases with a Part C plan, you can only use doctors who are in the plan's network to keep cost share more predictable. If you have a PPO, you can use out-of-network doctors but at a high-cost share. Medicare Advantage plans cover everything Original Medicare covers plus more, consider if you want coverage for dental, vision, and other extra benefits. A Medicare Advantage plan may be right for you. Especially if you have a chronic disease, there are plans available to care for chronic conditions that may be difficult to manage without the right care.
Prescription Drug Plans (PDP)
If you choose to maintain Original Medicare, it would be in your best interest to also enroll in a PDP, even if you enroll in a Medicare Supplement plan. Original Medicare does not cover prescription drugs outside of a hospital or doctor setting. This means that you will be responsible for the total cost of your medication. Some people falsely believe that because they don't take any medication they can simply enroll in a PDP later. The truth is that although you can do this it is not advised. If you delay getting prescription drug coverage without having coverage equal to or greater than Medicare standards you will be left paying a penalty because you didn't enroll when you were first eligible. Keep in mind that penalties are in addition to the premium for the plan and this penalty does not go away.
Not convinced, a common drug for older adults is a generic stomach acid reducer, Omeprazole, which can cost hundreds of dollars without insurance. With coverage, the prices are much more manageable. Did you know insurance agents can look at your medication before enrollment so you can be sure that your medications are covered by a plan you choose?
For a personalized quote, to compare plans, understand plan costs, and to understand what is available in your area before you join speak with a licensed insurance broker that can go over what plans are available in your area. But don't expect this process to be taken care of in a few minutes, this is an important decision and it is important that you get all pertinent information to better prepare you for what you want to that care of your health and finances. There are also plans that complement Medicare Advantage plans that are low cost and can enrich your benefit offering. The point is to get the care that you need, and the coverage that will be comprehensive enough to prove to be important to your current lifestyle.
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