What I Didn't Know About Medicare

I'll admit, I had a lot of assumptions about Medicare until I decided to write this post. For instance, I honest to goodness thought that Medicare was free once I turned 65. After all, I've been paying Medicare taxes for 35+ years and I thought free medical care when I retired was why. I also assumed it started automatically when I turned 65 whether or not I was applying for Social Security, I had no idea I had to actually apply. I also had no idea that prescription plans were an additional cost. Turns out I actually knew NOTHING about Medicare. I spent the better part of today finding out as much as I could and there is just so much information, I decided to condense down my research and pass along what I think are the most important points. Here goes.

The most urgent info in this post is this: Open enrollment for Medicare starts Oct 15.

If you’re turning 65 before January 15, 2020 or are already over 65 and not getting Social Security, now’s your chance to enroll. If you don’t get benefits from Social Security, you’ll need to sign up for Medicare Part A (Hospital Insurance) and Part B (Medical Insurance). TAKE ACTION NOW - you can only enroll in Medicare at certain times and missing the window can mean lifetime premium penalties and delays in when your coverage can start.

You can sign up during the 7-month period that begins:

· 3 months before the month you turn 65

· Includes the month you turn 65 - WARNING

· Ends 3 months are the month you turn 65 – WARNING

WARNING: If you wait until the month you turn 65 (or the 3 months after you turn 65) to enroll, your Part B coverage will be delayed, and could cause a gap in your coverage.

Medicare.Gov has a pretty handy tool to find out if you’re eligible for Medicare and when you can enroll.

If you or your spouse (living, deceased or divorced) paid Medicare taxes during at least 10 years of work, you will get free Medicare Part A, but most people have to pay a monthly premium for Medicare Part B. The standard premium amount for Part B is $135.50. This amount can be higher based on your income. Because you have to pay for it, you can turn down Part B, but beware! If you don’t enroll in Part B as soon as you’re eligible, your monthly premium will go up 10 percent for each 12-month period that you were eligible but didn’t enroll.

You can apply for Medicare online if you:

· Are at least 64 years and 9 months old

· Don’t already have ANY Medicare coverage

· Don’t want to start receiving Social Security yet (you’re not ready to retire) AND

· Are not receiving any SS retirement, disability or survivors benefits

Not only do you need to sign up for Part A and Part B, you’ll also need to enroll for Part D (Medicare Prescription Drug Plan) and if you need help paying your out-of-pocket costs (like your 20% coinsurance), you’ll need to buy supplemental coverage like a Medigap policy.

As an alternative to Original Medicare (described above), you can enroll in Medicare Advantage which may offer vision, hearing, dental and other extra benefits that Original Medicare doesn’t. Medicare Advantage plans may have lower out-of-pocket costs than Original but you’ll need to use doctors who are in the plan’s network.

To compare all of the options and figure out which plan is best for you, try the Medicare Plan Finder.

SNAPSHOT comparison

Original Medicare (Use of any doctor or hospital that takes Medicare, across the U.S.)

- No prescription, vision, hearing, dental or help with out-of-pocket costs = $135.50 per month

- With prescription plan added = $148.70 - $219.70 per month

- With prescription plan and Medigap policy = $148.70 - $404.48 per month

Medicare Advantage Plan (Use only of doctors and hospitals in the plan’s network)

- Includes Part A, Part B, prescription, help with out-of-pocket costs, vision, hearing and dental

$135.50 - $225.50

- Medicare Advantage Plan has more limitations and “rules” than Original Medicare so it’s important you understand the difference between the plans before choosing based on monthly costs. Find out more here.

Original Medicare Medicare Advantage Plans

Even if you aren't nearing 65, it's important to understand how the system works so you don't end up with higher premiums, loss of coverage or a plan that isn't what you need it to be. I encourage you visit the same source as I used for this post, www.medicare.gov. Arm yourself with knowledge now so you aren't battling the system later.

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