What you need to know for Medicare Open Enrollment
If you’re approaching the age of 65, in addition to considering life without an alarm clock, you need to consider your health insurance options very carefully. A form of Medicare most likely will be your main health insurance.
Because there are so many options, it can be complicated. I’ll break the basics down and share some resources to help you make the right decision.
Don’t wait to think about your options! When you turn 64, here is a great month by month checklist of things to consider.
The Basics
- Medicare is a federal insurance program. To qualify you must be 65+, under 65 with a disability or have an end-stage renal disease.
- According to Medicare.gov, if you don’t enroll when first eligible you may pay a penalty and have a gap in coverage. An exception to this is if you have other credible coverage like a health insurance plan from your employer.
- You can keep Original Medicare only (the Federal program) and in addition, you may purchase a Medicare Supplement plan to help with the copays and deductibles that Original Medicare does not cover.
- You can replace Original Medicare with a Medicare Advantage plan (from a private insurer who has a Medicare contract to administer benefits). Many do this because of the additional options they offer.
- This year’s open enrollment to purchase a Medicare Advantage or Part D plan (prescription drug coverage) is Oct. 15 – Dec. 7.
The Options
Medicare Part A and B Plans (Original Medicare)
This is what we call original Medicare which the government administers. The premium is deducted from your monthly social security check.
- Medicare Part A covers inpatient hospital stays, skilled nursing facilities, hospice care, and some home health care.
- Medicare Part B covers certain doctor services, outpatient care, medical supplies, and preventive services
You will not have copays but will be required to pay coinsurance. Medicare will pay 80 percent of the medical expenses approved by Medicare while you will be responsible for the remaining 20 percent.
Original Medicare does not cover most prescription drugs or other services private insurers may offer.
Medicare Supplement (Medigap)
A Medicare Supplement (Medigap) policy is an additional option when purchasing Original Medicare. It’s sold by private insurers and helps pay some or all the health care costs that Medicare doesn’t cover, like copayments. coinsurance. deductibles.
[box] Tip: If you travel a lot or simply don’t want to worry about selecting a network of doctors you may be interested in Medicare Supplement plan like plan F or plan G. These popular plans are normally based on age and start off with lower premiums but premiums can increase as you age. A key benefit for these types of plans is that they require little out of pocket expenses when visiting a doctor. [/box]
Medicare Advantage Part C Plans
This type of plan is administered by a private health insurer. These plans, in addition to offering everything Original Medicare provides, offer additional features and benefits that you may not get with a Medicare Supplement plan. Most of these plans include prescription drug coverage and have in-network doctors. You would pay your premium directly to a private insurer and maintain lower out of pocket costs if seeing network doctors.
When selecting a Medicare Advantage Plan you would still be required to pay your Medicare Part B premium, normally deducted from your social security check.
Medicare Part D (Prescription drug coverage)
This type of plan is administered by a private health insurer. Medicare Part D is a standalone prescription plan that helps cover your prescription needs and is typically paired with a Medicare Supplement plan. Many Medicare Advantage plans have Part D drug coverage, but there are some that offer medical benefits only. You are not allowed to have both a Medicare Advantage plan and a stand-alone Part D drug plan.
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This is what Medicare does and doesn’t cover from CNBC.
