Millions of disabled and elderly Americans are covered by Medicare, which is a federal health insurance program that covers people who are age 65 or older, people younger than 65 who have certain disabilities and people who have end-stage renal disease that requires kidney dialysis or a transplant. If you are recently disabled — or will soon be of age to qualify for Medicare enrollment, it’s helpful to know about the program and what type of coverage it provides.
- Medicare Contains Four Different Parts
Medicare isn’t a one-size-fits-all health insurance program. Instead it contains different parts that provide different types of coverage depending on the enrollee’s needs.
- Part A: Covers inpatient care, including home healthcare in some instances
- Part B: Covers basic routine healthcare, including visits to a general practitioner
- Part C: Also known as Medicare Advantage; allows enrollees the option of getting a plan from a private insurer that operates within Medicare guidelines
- Part D: Covers select prescription drugs; may be a standalone or supplemental plan
- If You Receive Social Security Benefits Already, Enrollment Will Happen Automatically
If you’re already receiving Social Security benefits at age 65, enrollment in Medicare Parts A and B should happen automatically. The only reason enrollment wouldn’t take effect is if you — or your spouse — haven’t paid Medicare taxes for at least 10 years. Automatic enrollment doesn’t apply to Medicare Parts C and D, however. Instead, you’ll have to sign up for those if needed.
- Enrollment Penalties Can Apply
If you’re not receiving or going to receive Social Security benefits at age 65, and you aren’t automatically enrolled in Medicare Parts A and B, you’ll need to take steps to enroll yourself in the program. Make sure you sign up within the seven-month enrollment period to avoid penalties. You can sign up during the three months before you turn 65, during the month of your 65th birthday or during the three months after you turn 65. There are a couple of special enrollment periods that are available to certain individuals who qualify, too.
- Medicare Charges Premiums in Some Instances
As long as you — or your spouse — have paid Medicare taxes for at least 10 years and qualify for Medicare Part A, it’s free. However, if you receive Medicare Part B, you’ll owe premiums. If you receive Social Security benefits or Railroad Retirement Board benefits, the premiums will be deducted from your benefits check.
- Other Medicare Charges Apply Besides Premiums
Even if you don’t have to pay Medicare Part A or B premiums, deductibles and coinsurance costs apply. For example, under Medicare Part A you’ll have to pay a deductible per benefit periods each time you stay in a hospital. Additional costs will apply if you stay in a hospital longer than 60 days or a skilled nursing facility more than 20 days. Under Medicare part B, you’ll owe an annual deductible, plus 20% coinsurance costs. If you have Medicare Parts C or D, deductible and coinsurance costs apply depending on each plan.
- Medicare Prescription Drug Coverage Recently Got Better
In 2019, Medicare prescription drug coverage got better for enrollees. After Medicare has paid for $3,750 of annual drug costs each year, enrollees will pay 25% of the cost of name-brand or generic prescriptions thereafter, rather than the previous 44% for generics and 35% for name brands.
- Medicare Will Pay for Telehealth Services
If you aren’t able to get to the doctor, Medicare may still pick up the tab for telehealth services. Although you won’t get a break on the cost of the visit (you’ll still be charged the same fee as if you had gone in-person) it can be helpful to be able to use your Medicare benefits in the event that making a physical trip to the doctor is not possible.
- Medicare Parts A and B Have Coverage Exclusions
Unfortunately, Medicare Parts and A and B will not pay for everything that you may need. Here are some things that Medicare excludes from coverage:
- Long-term care
- The majority of dental care, including denture needs
- Hearing aids and related exams
- Cosmetic surgery
- Routine foot care needs
- Eye exams for the purpose of a prescription for glasses
But that doesn’t mean that you’ll have to foot the entire bill if you need things to improve the quality of your life, such as hearing aids or dentures. Instead, you can sign up for a supplemental, private plan with an insurer that contracts with Medicare to help cover these type of expenses.