When you’re new to learning about Medicare you may get lost in making sense of the Medicare alphabet soup. Part A, Part B, Part C, Plan G – what do they all mean? More importantly, which part and plans of Medicare do you need? Fear not – this article will share with you some things that you should know about Medicare.
The Parts of Medicare
This is where the Medicare alphabet soup comes in. Medicare has four parts; Original Medicare has Parts A and B. Medicare Part C is also known as Medicare Advantage. Medicare Part D is your prescription drug coverage.
Part A covers your inpatient hospital care, hospice, skilled nursing facility, and home health care. Part B covers your doctor visits, outpatient care, durable medical equipment, and preventative care. Part C, also known as Medicare Advantage plans, pick up costs Parts A and B do not cover. Part D is your prescription drug coverage, it helps cover the cost of prescription drugs.
In addition to the four parts of Medicare, there is Medicare Supplemental Insurance, also known as Medigap. Medigap is extra insurance you can buy that helps cover your costs from Parts A and B. There are different Medigap plans such as Plans A-D, Plans F-G, and Plans K-N. The benefits in each Medigap plan are the same, regardless of which agency is selling it.
Now that the parts of Medicare have been established, the next step is to learn about when and how to sign up for Medicare.
When and How to Sign Up
Most people will receive Medicare Part A and Part B when they are first eligible when they turn 65. When you turn 65, you will have an Initial Enrollment Period. This Initial Enrollment Period lasts seven months. It begins three months before you turn 65 and ends three months after the month you turn 65. If you miss this Initial Enrollment Period, you may have to wait to sign up and pay a late enrollment penalty for delaying Part B if you did not have creditable coverage. The longer you wait, the more the penalty goes up. It is important to sign up when you are supposed to in order to avoid penalties and delays in coverage.
There are some instances where you may wonder if you should sign up for Medicare. For example, if you are still working and have employer insurance. There are many Medicare eligibility tools online you can use to see if now is the time you should sign up for Medicare or if you can delay coverage without a penalty.
After you’ve signed up for your Original Medicare Parts A and B, you may begin looking at Medicare Advantage Plans or Medigap plans if you’re interested in additional coverage. Perhaps you need a good prescription drug plan and go with a Part D plan. Or maybe you are not fond of the extra charges after Part A or Part B have covered their part and want a Supplement Plan G to pick up the remaining. Compare Medicare Advantage plans vs. Medicare Supplemental plans and see which one fits your needs best if you’re looking for additional coverage.
What Does Medicare Cost?
Part A is usually $0 for most people. This is because they paid Medicare taxes during their working years, generally 10 years. If you did not have enough working hours, the premium is either $259 or $471 a month in 2021. The Part A deductible is $1,484 every time you’re admitted to the hospital per benefit period.
Part B has a premium starting at $148.50 each month or higher depending on your income in 2021. The 2021 deductible is $203 once per year. You’ll typically pay 20% of the cost for each covered service after you have paid your $203 deductible.
The cost for Medicare Part D varies since these plans are sold by private insurance carriers. Part D premiums depend on the plan you join, and most plans charge a deductible.
Medicare Advantage Plans have monthly premiums based on the plan you join. It also has deductibles, coinsurance, and copayments based on your plan. Again, the cost-sharing amounts vary by plan since these types of plans are sold by private insurance carriers.
Medigap plans are also sold by private insurance carriers. The monthly premium varies from person to person, since the premiums are based on your policy, where you live, your age, tobacco use, and other factors.
Your price for Medicare will differ from someone else’s price. Your price for Medicare will depend on your income, your demographics, adding on a Medicare Advantage plan or a Medigap plan, and many other factors.
Medicare can be very confusing when you first begin to learn about it. When you begin to learn about Medicare, a great way to start is to educate yourself on the parts of Medicare, the benefits of the different parts and plans, and when and how you sign up. After you have covered those basics, you will start to find out how much Medicare costs and get ready to get signed up. You will not regret putting the time in to learn about Medicare. It could save you money down the road by educating yourself on what it is and what you need ahead of time.