Many of us – especially if we’ve been paying high premiums for insurance – look forward to the time when we are eligible for Medicare. Getting enrolled, understanding what’s covered and what’s not, and choosing between original Medicare and a Medicare Advantage plan can be a bit confusing, however. Here are some basics to get you started, and some resources for more information.
Medicare Parts and What They Cover
Part A, Hospital Insurance, helps cover inpatient care in a hospital or a skilled nursing facility, hospice care, and home health care. It does NOT cover custodial or long-term care. Copayments, coinsurance or deductibles may apply. For most people there is no cost for Part A.
Part B, Medical Insurance, helps cover medically necessary doctors’ services, outpatient care, home health services, durable medical equipment, mental health services and other medical services. It also covers many preventive services. There’s a deductible ($183 in 2018) and once that’s paid Medicare typically pays 80% of the Medicare-approved cost of the service. There is a premium for Part B.
Part D, Prescription Drug Coverage, helps cover the cost of prescription drugs. There’s also a premium for Part D, which varies by geography and insurer.
When you first enroll in Medicare and during the annual open enrollment period you have two options for coverage: Original Medicare or Medicare Advantage (Part C).
Original Medicare includes Part A and Part B. Part D, prescription coverage, is optional and can be purchased separately. It’s recommended, though, that you sign up for Part D when you originally enroll, even if you are not currently taking any prescriptions, to avoid a late-enrollment penalty. Most people who opt for Original Medicare also add a Medical Supplement Insurance (Medigap) policy to cover out-of-pocket expenses like the Part B deductible and coinsurance.
Medicare Advantage (Part C) is an alternative to Original Medicare and bundles Part A, Part B, and usually Part D all together in one plan. Some of these plans have lower out-of-pockets and also cover things Original Medicare doesn’t cover, like vision, hearing or dental.
It’s also helpful to understand the difference between a “copay” and “coinsurance.” Both are a form of cost sharing for health services or prescription drugs between insurance companies and the insured. A copay is a flat fee, for example the $10 (or so) that you pay each time you go to the doctor. Coinsurance is a percentage of the cost for a health service or prescription drug paid by a member after they have reached their deductible. For example, after you reach your deductible your insurance may cover 80% of your health costs and you pay the coinsurance of 20%.
If you’re under 65 and already receiving social security benefits or railroad retirement benefits, you’ll automatically be enrolled in Part A and Part B on the first day of the month you turn 65.
If this doesn’t apply to you, you’ll need to sign up. Contact socialsecurity.gov/retirement during your “Initial Enrollment Period.” This begins 3 months before the month you turn 65 and ends 3 months after the month you turn 65. In most cases if you sign up in the first 3-month period your coverage will begin in your birthday month. Happy Birthday!
If you are still employed and covered by your employer, you may want to wait to sign up for Part B until that coverage ends. In that case you would sign up during a Special Enrollment Period, which is any time while you’re still covered by the group health plan or during the 8-month period that begins the month after your employment or coverage ends, whichever happens first.
If you didn’t sign up during your Initial Enrollment Period and don’t qualify for the Special Enrollment Period, you can sign up during the General Enrollment Period, which is January 1 through March 31 each year. Your overage will not begin until July 1 of that year and you will pay a higher Part B premium for late enrollment.
Preventive Services Coverage
- Medicare Part B covers a number of preventive services. Here’s a partial list:
- Welcome to Medicare preventive visit (during first 12 months of coverage)
- Annual “wellness” visit (after 12 months of coverage)
- Bone density scans
- Pap tests and pelvic exams
- Chiropractic services (limited and when medically necessary)
- Colorectal cancer screenings
- Depression screening
- Diabetes screening
- Flu shots
- Glaucoma tests
- Obesity screening and counseling
- Various cancer screenings
- Smoking and tobacco-use cessation
An important note: The wellness visits are fully covered by Medicare (no copay). However, if during the visit your provider performs tests or services not included in the preventive benefit, you may have to pay coinsurance and the Part B deductible may apply.
What’s NOT Covered by Medicare Part A and Part B (but may be covered by a Medigap or Medicare Advantage Plan)
- Dental care
- Eye exams related to prescribing glasses/contacts
- Cosmetic surgery
- Massage therapy
- Hearing aids and exams for fitting them
- Long-term care
For more information about coverage, enrollment and the plan that’s right for you, call 1-800-633-4227 or go to Medicare.gov.