If you are confused about Medicare, you are not alone. You may feel overwhelmed trying to understand all of its parts and your options. It can be helpful to get a grasp of the basics and discern what information is important for you to know first before diving further into the details.
In short, Medicare is a federal health insurance program, primarily for those 65 years of age or older and some younger people with disabilities. There are different parts to Medicare, each covering specific services:
Part A: This helps pay for a stay in the hospital and skilled nursing facilities, home health services, and hospice care – provided certain conditions are met. There are no monthly premiums if you or your spouse paid sufficient Medicare payroll taxes while working.
Part B: This helps pay for certain doctors’ services, outpatient care, and medical equipment and supplies (such as wheelchairs and oxygen). Unless your income is limited enough to qualify for state assistance, you pay a monthly premium for Part B. Medicare typically pays 80 percent of the Medicare-approved cost of each service and you pay 20 percent. If you have supplemental insurance, it may cover your 20 percent out-of-pocket expense.
Part D: This helps pay for prescription drugs, including many shots and vaccines. You can get this coverage in one of two ways: by joining a private “stand-alone” Part D drug plan for an additional monthly premium (if you are enrolled in traditional Medicare), or by enrolling in a Medicare Advantage plan that includes Part D coverage in its benefits package.
Every year, Medicare has an open enrollment period: October 15 – December 7. During this time, Medicare beneficiaries can do the following:
- Switch from Original Medicare to Medicare Advantage, or vice versa;
- Switch from one Medicare Advantage plan to another;
- Change their Medicare Part D (prescription drug) plan; or
- Enroll in a Medicare Part D (a late enrollment penalty may apply)
It is important for Medicare beneficiaries to annually review their current plans, options, and needs for the next year. Medicare health and drug plans can change each year including things like cost, coverage, and what providers and pharmacies are in their networks. To be sure you have the best plan to meet your needs, make sure to take action during open enrollment. Remember: Medicare is not a “set it and forget it” insurance plan.
