Understanding the Basics of Medicare
At Healthcare Select, we’re focused on helping you find the right resources and support to improve and maintain good health, and this includes your healthcare coverage. In this article, we’ll explain more about Original Medicare, Medicare Advantage, and how you can get the right plan for you.
What is Medicare?
Medicare is a health insurance program from the U.S. government that started back in 1965. It was created as a way to make sure people aged 65 and older had access to affordable healthcare. Original Medicare is made up of two parts: Part A and Part B. There are other parts of Medicare—such as Medicare Advantage plans—that should also be taken into consideration when you’re comparing your available options for coverage.
What are the parts of Medicare?
Medicare can be like a puzzle with different pieces, and each piece helps with a different part of your healthcare. It’s important to understand these parts so you can put together the right plan for your healthcare needs.
Original Medicare (Parts A and B)
Original Medicare is the basic plan that everyone starts with. It is made of two parts:
Part A (Hospital Insurance): This helps pay for things that happen inside a hospital, such as a hospital stay, care in a skilled nursing home after a hospital stay, or even hospice care. For most people who have worked and paid Medicare taxes for at least 10 years, Part A is free.
Part B (Medical Insurance): This helps pay for things that happen outside a hospital, such as doctor visits, outpatient care (like a day surgery), physical therapy, and important medical tests. You will likely pay a monthly cost for this part.
Part D (Prescription Drug Coverage)
If you choose to stay with Original Medicare, you will also need to get a Part D plan, as this plan helps pay for medications. Even if you don't take many prescriptions now, it's a good idea to get a Part D plan when you first become eligible. If you wait too long to sign up, you might have to pay a penalty on your premium later on.
You can obtain Part D from a private insurance company.
What are my other options?
While Original Medicare is a great start, many people choose other plans to get more coverage and benefits.
Medicare Advantage Plans (Part C)
Medicare Advantage plans are an alternative to Original Medicare. They’re required to include everything Part A and B offer, but also often include additional routine benefits such as prescription drug coverage, routine dental, routine vision, and routine hearing care. Medicare Advantage plans are offered by private insurance companies.
Medicare Supplement Plans (Medigap)
Medicare Supplement plans, also known as Medigap, are another option from private insurance companies that can help pay for “gaps” in your Original Medicare coverage. These can be costs Original Medicare doesn't cover, such as copays, coinsurance, and/or deductibles.
When do I sign up for Medicare? The Initial Enrollment Period (IEP)
This is the most important time to get ready for Medicare. It is a 7-month window around your 65th birthday, and it’s a good idea to sign up during this time so you can avoid late enrollment fees.
Three months BEFORE your birthday month
Your birthday month
Three months AFTER your birthday month
Let’s say your 65th birthday is in June. Your Initial Enrollment Period would start on March 1 and end on September 30. The best time to act is in March, April, or May, so your coverage can begin in June and you have nothing to worry about.
What about the Medicare Advantage Annual Enrollment Period?
After you have signed up for Original Medicare, you get a chance every year to review your current coverage, compare it to the plans available in your area, and make changes to your plan if needed. This is called the Medicare Advantage and Prescription Drug Plan Annual Enrollment Period (AEP), and it happens annually from October 15 to December 7.
During this time, you can:
Change from Original Medicare to a Medicare Advantage plan.
Switch from one Medicare Advantage plan to a different one.
Go back to Original Medicare from a Medicare Advantage plan.
Add, drop, or change a Part D prescription drug plan.
Any changes you make during the AEP will start on January 1 of the next year. It's a great time to make sure you have the right plan for your healthcare needs and budget.
Make Sure You Have Access to the Resources Available to You
As a member of Healthcare Select, you can expect to receive ongoing support and recommendations for the services and resources available to you. And as a Medicare beneficiary, it’s important to know what your options are for healthcare coverage.
The first step is taking the time to understand the basics of Original Medicare and Medicare Advantage plans, then determining what’s next for you. Use this article as a tool to create a better understanding of your options so you can go into the next year with confidence.