New to Medicare but unsure where to start? Texas Medicare Advisors has the info you need, with everything from the basics to enrollment periods and your plan options. We will make sure you get started on the right foot.
Medicare is a national healthcare program funded by the U.S. Government, created in 1965 to give coverage to people of age 65 or older who didn`t have any health insurance.
The program is administered by the Centers for Medicare and Medicaid Services (CMS), and coverage is extended to people with certain disabilities, those who have End-stage renal disease (ESRD), and those who have Lou Gehrig’s disease as well as Amyotrophic Lateral Sclerosis (ALS).
Medicare provides healthcare at low costs, with benefits such as hospitalization, medical coverage, and more.
There are four different parts to Medicare, all of which provide different types of services for the insured, named alphabetically: Part A (hospital insurance), Part B (medical insurance), Part C (Medicare Advantage), and Part D (prescription drug coverage).
Parts A and B, otherwise known as Original Medicare, offers easy enrollment and eligibility, as well as low monthly and yearly payments for continued coverage.
Covering the costs of Medicare includes 3 basic methods of payment: premiums, deductibles, and copayments/coinsurance. The same goes for all of the additional coverage options as well. These payments work like this:
You likely will not, however, have to pay premiums for Medicare Part A. If you have worked at least 10 years while paying Social Security taxes, you’re eligible for premium-free Part A.
Medicare Advantage is also known as Part C of Medicare. It is administered by private insurance companies certified by Medicare. If you choose to join a Medicare Advantage Plan, it will provide all of your Part A and Part B coverage.
Part C may offer extra coverage, such as vision, health and wellness, hearing, and dental services. Most Medicare Advantage plans include Medicare prescription drug coverage, known as Part D.
In general, Part C coverage for inpatient care is covered by Medicare Part A. Regarding Part C, it covers the same services as Medicare Part A, including inpatient hospital care and inpatient care in a skilled nursing facility.
Part C also covers Home health care, but hospice care benefits remain under Original Medicare (Part A and B). As for outpatient care coverage, which is covered by Part B in general, Part C covers the same benefits as Part B.
There are a few extra benefits that Medicare Part C covers, but Original Medicare does not. Some of the services that Part C may include as extra benefits are:
The main qualification for being eligible for Medicare Advantage plans is that you have already been enrolled in Original Medicare (Parts A and B) and that you live in the network area of the Part C provider you are considering applying to.
Medicare Part C costs are determined by several factors, such as premiums, deductibles, copayments, and coinsurance. These amounts can range from $0 to hundreds of dollars for monthly premiums and yearly deductibles. But most of your Part C costs will be determined by your chosen plan.
There are two main types of Medicare Advantage plans offered:
Besides these two plans, there are Private Fee-for-Service Plans (PFFS), Special Needs Plans (SNP), and Medicare Medical Savings Account (MSA) Plans.
Medicare Supplement Insurance (also called “Medigap”) is insurance that helps fill “gaps” in Original Medicare and is sold by private companies. Original Medicare pays for much, but not all of the cost for covered health care services and supplies.
A Medicare Supplement Insurance (Medigap) policy can help pay some of the remaining health care costs, like Copayments, Coinsurance, and Deductibles.
Medicare supplement plans are secondary payers to Original Medicare. Since Parts A and B do not cover 100% of healthcare expenses, Medicare supplement plans can help you pay the remaining costs. As long as the provider accepts Medicare assignment, they will also accept one of the Medicare supplement plans.
There are 10 Medigap plans on the market, including plans A, B, C, D, F, G, K, L, M, and N. Your choice of a plan depends solely on your healthcare and financial needs.
Generally, Medicare Supplement Plans F, Plan G, and Plan N are the most popular types of Medicare Supplement plans. Medicare Supplement Plan F is the most comprehensive Medigap option available, providing beneficiaries with 100% coverage of Medicare-covered medical expenses after Original Medicare pays its portion.
It is important to mention that from January 1st, 2020, Medigap plans sold to people new to Medicare can no longer cover the Part B deductible. Because of this, Plans C and F are no longer available to people that enrolled in Medicare on or after January 1, 2020.
If you already have either of these 2 plans or are covered by one of these plans before January 1, 2020, you can keep your plan. If you were eligible for Medicare before January 1, 2020, but not yet enrolled, you may be able to buy one of these plans (Plan C or F).
With Medicare Supplement Plan G beneficiaries are responsible only for their annual Medicare Part B deductible, after which the plan provides 100% coverage on all Medicare-approved medical expenses. Finally, Plan N tends to be the most affordable for beneficiaries who don’t require medical care regularly but are interested in emergency coverage.
Medicare Part D is a prescription drug benefit program that is offered as part of the wider Medicare federal health insurance program. Part D is an optional benefit that is administered by private insurance companies and available to anyone who has Medicare.
Medicare Part D is simply insurance for your medication needs. You pay a monthly premium to an insurance carrier for your Part D plan. In return, you use the insurance carrier’s network of pharmacies to purchase your prescription medications.
Instead of paying full price, you will pay a copay or percentage of the drug’s cost. The insurance company will pay the rest.
There are 4 stages to a Part D drug plan:
Medicare allows drug plan carriers to apply certain rules for safety reasons and also for cost containment. The most common utilization rules that you may run into are:
Anyone who has lived in the United States legally for at least five years and is age 65 or older qualifies for Medicare coverage. Enrollment in Parts A and B is automatic for anyone who receives Social Security benefits and has worked enough to be eligible for those benefits.
If you or your spouse are a government employee or retiree who has not paid into Social Security but has paid Medicare payroll taxes while working you are eligible for Medicare as well. Part C and Part D coverage is optional, and enrollment must be done by the individual.
You might also be eligible for Medicare if you are under 65 years old if:
There are a few different ways you can enroll in Medicare. If you’re already receiving benefits from Social Security Administration or the Railroad Retirement Board at the time you turn 65 years old, you will automatically be enrolled in Original Medicare (Parts A and B).
Besides automatic enrollment, first-time Medicare beneficiaries have the option of enrolling during their Initial Enrollment period.
This 7-month period starts three months prior to your 65th birthday, includes your birth month, and lasts until three months after your birth month.
It’s important to enroll during this time because if you don’t, you may have to face paying late enrollment fees or have to wait until the General Enrollment Period which happens between January 1st to March 31st of the following year.
Group health is the insurance you receive through your employer. As long as you’re working for this employer, you have the option to combine, keep, or leave their plan.
If you still have a group health plan at the time you first become eligible for Medicare, you can decide whether you want to change the plan or leave it.
It is advisable to enroll in Medicare no matter what you plan on doing with your group health insurance. However, if you are ready to retire and/or leave your group health plan, you may be able to avoid paying for late fees by enrolling during the Special Enrollment period.
When and if your group health plan ends, you will automatically be eligible for the SEP, meaning that you can enroll in Medicare during this time without any penalties.
If, in other case, your employer allows you to keep your group health plan after you’ve retired, you should enroll for Medicare during your Initial Enrollment Period. This period starts around the time you turn 65 which is when you become eligible for Medicare insurance for the first time.
For more information about asset based long term care, reach out to Texas Medicare Advisors today.
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