It is never too early for someone to start thinking about healthcare coverage. As you approach age 65, Medicare insurance may be top of mind. Most people in the workforce, or their spouses, have been paying into the Medicare fund for most of their working lives. It is your right and in your best interest to understand what Medicare options you might have coming.
Medicare is broken down into four parts — A, B, C and D. Letâ€™s take them letter by letter.
Medicare Part A: Inpatient Hospital, Skilled Nursing Home, Home Health and Hospice Care
The U.S. Congress enacted Medicare in 1965 because most Americans of retirement age found it impossible, or nearly so, to get medical insurance. Medicare Part A deals with major eventualities such as hospital care, nursing homes, home health and hospice care. The U.S. Department of Health & Human Services notes that Medicare is available for people age 65 or older, younger people with disabilities and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant). The Medicare.gov site explains certain specifics about what Part A covers.
What doesnâ€™t Part A necessarily cover? Itâ€™s a good question. The answer is a lot.
- Long-term, non-medical custodial care (helping individuals with daily basics like eating and bathing
- Most dental care (including dentures)
- Eye exams related to prescribing glasses
- Hearing aids and exams for fitting them
- Routine foot care
- Cosmetic surgery
You are eligible for premium-free Part A if you are age 65 or older, and you or your spouse worked and paid Medicare taxes for at least 10 years. You also can get Part A at age 65 without having to pay premiums if you meet certain criteria, which you can check here. It is advised you sign up for Medicare benefits three months before you turn 65 through the Social Security Administration.
Medicare Part B: Optional but Important Medical Services
Medicare Part B is an optional plan that helps to cover doctor services and outpatient care, including medically necessary and some preventive services, including:
- Lab tests
- Ambulance services
- Durable medical equipment
- Mental health (inpatient, outpatient, partial hospitalization)
- Second medical opinions before having surgery
- Limited outpatient prescription drugs (typically administered at the doctorâ€™s office, rather than a pharmacy)
Medicare Part C: Private Insurance or â€œMedicare Advantageâ€
Medicare Advantage Plans (sometimes called “Part C” or “MA Plans”) are plans offered through private insurance companies approved by Medicare. If you join a Medicare Advantage Plan, you still have Medicare. However, these plans replace the benefit structure of Medicare. The advantage for the patient, in theory, is more freedom and flexibility.
Medicare Advantage Plans cover all Medicare services. Most Medicare Advantage Plans also offer extra coverage, such as dental, hearing and vision coverage. These are services that may not otherwise be covered. Medicare pays a fixed amount for your care each month to the companies offering Medicare Advantage plans. These companies must follow rules set by Medicare. Choosing Medicare Advantage might also mean youâ€™ll have different out-of-pocket costs, and you might have to abide by different rules when using certain services, such as:
- Whether you need a referral to see a specialist
- If you have to go to doctors, facilities, or suppliers that belong to the plan for non-emergency or non-urgent care
Note: these rules can change each year.
Medigap: Supplemental, Private Insurance That Fills in the Gaps
Also be aware of Medigap insurance, which functions as the name implies. Itâ€™s supplementary private insurance (different from Medicare A, B, C or D) to help to pay healthcare costs that Medicare doesnâ€™t. It is also important to note you cannot have both a Medicare supplement and a Medicare Part C plan. If you are in the Original Medicare Plan and have a Medigap policy, then Medicare and your Medigap policy will each pay its share of covered health care costs. This means an extra premium, which could cover you for copayments, coinsurance and deductibles. Some use Medigap for prescription drug coverage.
Medicare Part D: Prescription Drug Insurance
Medicare Part D plans help cover the costs of outpatient prescription drugs. These plans may help lower your costs for prescription drugs and may help protect against higher future costs. Medicare Part D can be purchased as a standalone plan to supplement Medicare Parts A and B coverage or can accompany a Medicare Supplement plan. Almost all recipients of Medicare have some kind of prescription drug coverage.
It is important to note, Medicare Part B covers treatments for chemotherapy, dialysis or other medicines that are injected or given intravenously. Part D does cover some self-injected medicines, such as insulin for diabetes.
For those who need extra help to pay, thereâ€™s a supplemental prescription drug program called Extra Help. Check to see if you qualify.
Get a Medicare Plan From SelectQuote
Medicare was created so that those who couldnâ€™t afford (either at all, or easily) health insurance would not be excluded from necessary services simply because of their age. To ensure you are covered in case of emergencies, preventive care or even for everyday events related to your quality of life, it pays to read up on what Medicare is and how you can benefit from it.
Your SelectQuote licensed sales agent is here to help you answer any questions you have about what Medicare covers.
De-Mystifying Medicare Supplement Insurance
What You Should Think About When Thinking About Retiring