Exploring Medicare Options

Understanding Medicare’s Different Parts

Medicare is made up of different parts, and each one covers certain medical services. Learning about these options can help you understand the basics of the program and how to get coverage. The program is funded by Medicare taxes, which are paid by both employees and employers and taken out of each paycheck.

• Medicare Part A (Hospital Insurance): Part A covers inpatient care you receive in a hospital, a skilled nursing facility, or care provided by hospice. For many, it’s premium-free with no out-of-pocket costs, since they or their spouse already paid Medicare taxes for a certain number of years.
• Medicare Part B (Medical Insurance): Part B covers a wide range of medical care and outpatient services, including doctor’s visits, preventive care, lab tests, home health services, and durable medical equipment. Some pay an additional premium monthly for Part B.
• Medicare Part C (Medicare Advantage): These are comprehensive health plans offered by private insurance companies approved by Medicare. They are an alternative way to receive your Medicare benefits. Medicare Advantage plans combine the coverage from Parts A and B, often including prescription drug coverage, as well as additional benefits such as vision and dental care. They may have a higher total cost, but include more services.
• Medicare Part D (Prescription Drug Coverage): Part D helps cover the cost of prescription drugs. You can get drug coverage in two ways:
  • A separate Medicare drug plan added to your Original Medicare plan. You must have Medicare Parts A and B to enroll in a Part D plan.
  • As part of your Medicare Advantage Plan (Part C) or other Medicare health plan, these are bundled plans that include Part A, Part B, and usually Part D. These plans can consist of extra benefits that Original Medicare does not offer in its covered services.

What Medicare May or May Not Cover

Original Medicare (Parts A and B) plans cover many medically necessary services, but not everything. Knowing its limits can help you plan ahead and avoid unexpected costs.

What Medicare generally covers:

• Hospital care and inpatient hospital stays.
• Doctor visits and outpatient care.
• Diagnostic tests and screenings.
• Durable medical equipment.
• Home health care with skilled nursing.
• Hospice care services.

What Medicare generally does not cover:

• Routine dental care, such as cleanings and fillings.
• Eye exams and eyeglasses.
• Hearing aids and related exams.
• Most long-term care.

If you need coverage for these services, consider exploring a Medicare Advantage plan or other supplemental insurance options offered by private insurance companies to help reduce health care costs.

Choosing Between Medigap and Advantage Plans

When you become eligible for Medicare, you have a few ways to receive your benefits. Two of the most common paths are:

1. Original Medicare coverage plus a Medigap policy: With this option, you get your coverage through Original Medicare (Parts A & B). To help with out-of-pocket costs, you can buy a separate Medigap (Medicare Supplement Plan Insurance) plan from a private company. Medigap plans can help pay for some of the costs that Original Medicare doesn’t, such as deductibles and copayments. You will also need to enroll in a separate prescription drug plan (Part D), which Original Medicare doesn’t cover. One of the main benefits of this path is the freedom to see any doctor or hospital that accepts Medicare, with no restrictions on accessing out-of-network services.
2. Medicare Advantage (Part C) plan: With this option, you receive all your Medicare benefits through one plan from a private insurance company. These plans often have a network of doctors and hospitals. They also frequently include additional benefits, such as vision and dental coverage, as well as prescription drug coverage, all in one plan.

Supplemental Benefits

Even with Medicare, some costs may not be fully covered. Supplemental benefits can help fill the gaps and may offer added peace of mind. These are designed to help cover out-of-pocket costs you might not plan for but want to be prepared to handle.

Examples of supplemental benefits include:

• Dental, Vision & Hearing: Routine care that Original Medicare doesn’t cover.
• Cancer, Heart Attack & Stroke: Financial support if you’re diagnosed with a serious condition.
• Hospital Indemnity: Helps pay costs if you’re admitted to the hospital.
• Accident Treatment: Coverage for injuries from unexpected accidents.
• Life Insurance: Added financial security for your loved ones.

By adding the right supplemental benefits, you may be better protected from surprise costs.

Important Enrollment Periods

Enrolling in Medicare is a time-sensitive process, and missing deadlines can result in permanent late enrollment penalties and a delay in coverage.

• Initial Enrollment Period: This is a seven-month window around your 65th birthday. It’s your first chance to join a Medicare plan without penalties.
• General Enrollment Period: If you miss your initial enrollment period and don’t qualify for a special enrollment period, you can sign up for Medicare coverage of Part A and/or Part B during this time.
• Annual Enrollment Period: This is a yearly period when you can make changes to your Medicare coverage. It is your opportunity to switch between Original Medicare and a Medicare Advantage plan or to change your prescription drug plan or drug coverage.

How to Choose a Medicare Plan

The best plan for you depends on your individual health needs, budget, and lifestyle. As you review your options, keep these key factors in mind before enrolling:

• Cost: Check the monthly premiums, deductibles, and copayments. A low monthly premium may not always guarantee that you have all the coverage you need. A monthly Part C (Medicare Advantage) plan payment may cover more than an Original Part A and Part B plan with drug coverage, such as the Medicare drug plan (Part D).
• Coverage: Think about the specific benefits offered. Do you need a plan that includes prescription drug coverage? Are extra benefits like dental and vision important to you? Do you need home health care for daily tasks? Do you travel a lot of plan to move during the year?
• Doctor and Hospital Choice: Do you prefer the flexibility of seeing any provider who accepts Medicare, or are you comfortable using a plan’s network of doctors? Original Medicare covers services from any Medicare-approved provider, while Medicare Advantage plans may have additional restrictions.
• Health Status: Your current health may help decide which plan is best. If you have ongoing health needs, a plan with a higher premium but lower out-of-pocket costs may be better.

Final thoughts for you to take away…

Medicare can be a powerful tool for managing your health in retirement, but it’s essential to do your homework. By understanding the different parts, your coverage options, and key deadlines, you can make informed decisions. We encourage you to explore your options and find the plan that best fits your unique needs.

For general Medicare questions, visit Medicare.gov or call 1-800-MEDICARE.

Another helpful resource is the Medicare and You handbook. It contains contact information for various resources, including the State Health Insurance Assistance Program. This program provides free counseling to help you find a Medicare plan that’s right for you.