Medicare 101: Healthcare Class Is In Session for Your Senior Years
You may not think you need any more education as you approach retirement age, but you’ll want a little Medicare 101 if you hope to understand how this unique and complex healthcare program works. Medicare is a whole new world of health insurance unlike any coverage you’ve previously had, with new terms, more options, and different processes for enrolling and selecting coverage.
So, consider Medicare 101 class in session. We’ll give you a lay of the Medicare land so you have a basic understanding of the program. But if you want some additional tutoring and guidance on how to make the best choices to get the most out of Medicare, an experienced and independent Medicare broker can help ensure you get the coverage you need at the lowest possible cost.
Medicare 101 Lesson 1: What Is Medicare?
The federal government established the Medicare program in 1965 to cover most healthcare costs for Americans 65 or older, as well as for individuals under the age of 65 who have certain disabilities. Many folks confuse Medicare with Medicaid, but these are two distinct programs.
Unlike Colorado Medicaid, a state and federally funded program designed to provide medical care and coverage for low-income individuals, eligibility for Medicare is unrelated to a participant’s assets, income, or wealth.
Even though Medicare will cover the vast majority of your medical costs, the odds are you will still have out-of-pocket expenses for some of the treatment and care you receive, such as premiums, deductibles, coinsurance, and copays.
However, you can fill in these gaps in coverage by enrolling in a private supplemental insurance plan called, appropriately, Medigap.
Lesson 2: The Medicare ABC’s (and D’s)
If you want to learn how to read and write, you start with your ABC’s. The same goes for understanding Medicare. The Medicare program has four distinct parts – A, B, C, and D – each of which covers different things and involves unique issues:
Medicare Part A
This part of Medicare covers inpatient hospital stays, skilled nursing facility stays, some home health visits and hospice care.
In 2020, Medicare Part A inpatient hospital benefits are subject to a deductible of $1,408, which covers the enrollee’s share of costs for the first 60 days of inpatient hospital care in a benefit period. Participants must pay a coinsurance of $352 per day for days 61 through 90 of inpatient care.
For Colorado individuals in skilled nursing facilities, the daily coinsurance for days 21 through 100 of extended care services is $176.00. If you have at least 40 quarters of Medicare-covered employment, you won’t need to pay a premium for your Part A coverage.
Medicare Part B
Part B provides coverage for physician visits, outpatient treatment, preventive care services, and some home health visits. You’ll have to pay a deductible ($198 in 2020) for many services covered by Part B benefits. Typically, you will pay a coinsurance of 20 percent as well. But there’s no coinsurance or deductible involved in annual wellness visits or for preventive services rated ‘A’ or ‘B’ by the U.S. Preventive Services Task Force. This includes common tests such as mammograms or prostate cancer screenings.
Medicare Part C
Part C refers to Medicare Advantage. These Medicare-approved private insurance plans combine coverage for hospital care, doctor visits, and other medical services in one comprehensive plan that provides all of the same benefits as Medicare Parts A and B (except hospice care). Many Medicare Advantage plans also offer prescription drug coverage and other benefits like routine dental and vision care.
Medicare Part D
Established in 2006, Medicare Part D covers outpatient prescription drugs through private plans that contract with Medicare, including stand-alone prescription drug plans (PDPs) and plans with prescription drug coverage (MA-PDs). Participants in these optional plans have a wide range of choices among different PDP and MA-PD plans, with cost-sharing and premiums varying by plan.
Lesson 3: How to Enroll In Medicare
A Colorado Medicare card is like the federal government’s 65th birthday present to you. Generally, you can enroll in Medicare:
- When you turn 65, no matter your spouse’s age;
- Regardless of whether you are collecting Social Security benefits yet; and
- Even if you work past the age of 65 and keep your employer coverage or have coverage through your spouse’s employer.
While not everyone gets enrolled in Medicare automatically, the government will sign you up for Medicare Parts A and B, and you will get your Medicare card in the mail, if:
- You are turning 65 and are receiving Social Security or Railroad Retirement Board benefits.
- You are under age 65 and have received disability benefits for 24 months.
- You have Lou Gehrig’s disease (ALS) and start getting disability benefits.
If you do not fit into one of the above categories, you will need to take care of enrollment yourself during a window of time called the Initial Enrollment Period (IEP). Typically, your IEP starts three months before your 65th birthday and ends three months after. While you can still enroll in Medicare after the end of your IEP, you will have to pay penalties.
Take Your Education Beyond Medicare 101. Learn How We Can Help You Master Your Coverage and Maximize Your Benefits
Medicare is complicated, and the information you need to review and understand to make the right coverage choices can be overwhelming. It certainly goes beyond this introductory lesson.
An experienced, independent Medicare insurance broker at Preferred Insurance can help. From selection to enrollment to education and more, we can provide you with the knowledge and guidance that will allow you to make informed and optimal coverage decisions.
If you are a Colorado Springs resident who is 65 or over, please contact Preferred Insurance to schedule a free consultation to discuss your Medicare needs.