Medicare Made Easy (er)

Medicare is a federal health insurance program for eligible US citizens and legal residents. Medicare is individual health insurance, not a family or group plan. Each person must meet Medicare eligibility requirements as an individual.

Medicare is for US citizens and for legal residents who have lived in the US for at least the previous 5 years. You must be 65 years old, or have a qualifying disability and have received disability benefits for 24 months. Also, people with end-stage renal disease (ESRD) or ALS may be eligible sooner.

Original Medicare is the core coverage provided by the federal government. It has two parts. Part A and Part B. Part A is hospital insurance. Part B is medical insurance. Part A covers services provided during an inpatient hospital stay. Part B includes doctor visits, tests or exams your doctor may order, and other outpatient services. Part B also includes your Annual Wellness Visit and Durable Medical Equipment that is medically necessary and prescribed by a doctor. Please note, Medicare does not cover everything. It does not include coverage for prescription drugs, routine dental, vision and hearing care. It also does not cover long-term-care such as in a nursing home.

Most people are familiar with deductibles, premiums and copays. What you may not be as familiar with is Coinsurance. Coinsurance is an amount you pay when the medicare service cost is split with you. This is based on a percentage. For example, the cost of the service is covered 80% by Medicare and you pay the remaining 20%. . Most people who have paid into the system for 10 years will have a premium-free Part A. However, there is a Part A deductible, which amount changes every year. This would be based on your specific circumstances. There is no out-of-pocket maximum with Original Medicare on shared costs.

Since there is not a maximum out-of-pocket annual cost for Original Medicare, you may want to explore other options. You have two options for more coverage. The first option is to add a Medicare Supplement and Part D prescription drug plan to Original Medicare. The second option is to choose a Medicare Advantage plan (Part C). Many Medicare Advantage plans include drug coverage and additional benefits. All three of these option components are provided by private insurance companies, so you may have a number or plans available for you to choose from in your area.

Medicare Advantage plans must provide all the benefits that Original Medicare does. In Medicare Advantage (Part C), the plans combine Part A and Part B in one package. Most Medicare Advantage plans include prescription drug coverages. They may offer additional benefits such as fitness programs, wellness programs, dental, vision and hearing care. It may be familiar to you with what your employer provided for health insurance coverage.

You have two options regarding prescription drugs. One way you can get drug coverage is through a stand-alone Part D Plan, or as part of the Medicare Advantage plan (Part C). Both options are offered by private insurance companies, not the federal government.

Each Part D or Medicare Advantage plan will have a list of specific drugs covered. This is called a ‘formulary’. Each plan has its own list of drugs they cover, but every plan must cover a range of both generic and brand-name drugs that are needed by people on Medicare. Each formulary has different tiers of drug costs, with Tier 1 costing less than Tier 5. It is important to know what drugs you are prescribed and to understand the cost differences between plans.

It is critical to pay attention to your enrollment options to avoid late penalties and potential gaps in coverage.

There are different enrollment periods available to you. There is the Initial Enrollment Period, which starts 3 months before your birthday month, your birthday month, and the 3 months following your birthday month.

If you miss your IEP, you have another chance to enroll called the General Enrollment Period, which runs from January 1 to March 31 every year.

You may qualify for a Special Enrollment Period (SEP) if you work and have employer coverage past age 65, or if you move from your plan’s coverage area.

Medicare Advantage Open Enrollment is specifically for Medicare Advantage plan members and runs from January 1 to March 31.

You may also change your coverage choices during Medicare Annual Enrollment, which occurs during October 15 – December 7 every year.