Once you turn 65, you can take advantage of your Medicare benefits. After all, you’ve earned them! But do you know the what, when, and how of Medicare coverage? Don’t worry; we have you covered!
At Wandacare, our team is dedicated to providing guidance on the essentials, including when and how to enroll in Medicare, as well as understanding what each “part” of Medicare covers. Trust us to help you make informed decisions for your future healthcare.
When and How to Enroll in Medicare
Many people believe that when you turn 65, you’re automatically enrolled in Medicare. That’s a myth. If you are receiving disability benefits or are already receiving Social Security or Railroad Retirement Board benefits when you turn 65, you will be automatically enrolled in federal Original Medicare Part A and Part B coverage (more on what that covers in the next section).
If you’re like the majority of people turning 65 this year, you’ll claim your Medicare benefits by enrolling during your Initial Enrollment Period (IEP), which begins three months before your 65th birthday month, includes your birthday month, and continues for three months after your birthday month.
The team at Wandacare will assist you in completing your initial Medicare enrollment through the Social Security Administration (SSA). This step is essential to verify your eligibility, and our experts will guide you through the process.
But what if you have healthcare coverage when you turn 65? Perhaps you’re still working and covered by your employer’s healthcare plan, or you’re on your spouse’s plan. If you have other healthcare coverage, you can defer your Medicare coverage and be eligible for a Special Enrollment Period (SEP) later when your existing coverage ends. The SEP typically gives you eight months from the time your other coverage ends to enroll in Medicare without facing late enrollment penalties.
If you miss your IEP, you can enroll during the Medicare General Enrollment Period (GEP), which runs from January 1 to March 31 every year. Coverage will begin the 1st of the month following the month you enroll (for example, if you enroll in March your coverage will be effective April 1). However, you may incur late enrollment penalties of 10% on each part if you do not qualify for a Special Enrollment Period.
Knowing your Medicare eligibility and enrollment periods are crucial. Many people mistakenly believe that once they’ve turned 65, they can enroll in Medicare coverage at any time. Not true. Missing your Medicare enrollment periods and deadlines can result in premium penalties, some of which you’ll pay for the life of your Medicare coverage.
What to Enroll For: Medicare Parts and What They Cover
One of the best things about Medicare is that you have different “parts” to choose from, multiple benefit options, and different ways to get those benefits.
Federally administered Original Medicare includes two parts: Part A covering hospital insurance and Part B covering medical insurance. To avoid penalties you must enroll in a stand-alone-drug plan or choose a Medicare Advantage plan that includes drug coverage.
Medicare Part A: Hospital Insurance Coverage
Medicare Part A covers inpatient hospitalization care, including hospital admittance, skilled nursing facility care, hospice care, and some home health care services. Most people will not have to pay a premium for Part A coverage, as they’ve already paid for it through Medicare payroll taxes during their working years. Anyone who worked and paid Medicare tax for ten or more years qualifies for premium-free Part A coverage. If you’re already collecting Social Security disability benefits, you’re automatically covered by Part A. However, Part A coverage does come with an inpatient hospital deductible you are responsible for. In 2024, that deductible is $1,632.
Medicare Part B: Medical Insurance Coverage
Part B is the medical insurance component of Medicare and covers typical healthcare services at any hospital, doctor, or provider within the U.S. who accepts Medicare. Part B coverage includes preventive care and screenings, doctor visits, lab work, outpatient and ambulatory services, and durable medical equipment. It also covers some in-patient services that Part A doesn’t cover, such as some home health care, physical and occupational therapists, and mental health services (inpatient and outpatient), as well as partial hospitalization.
The majority of people will pay some form of monthly premium on Medicare Part B, with Medicare paying 80% of healthcare costs and you paying 20%. The Part B premium, deductible, and coinsurance rates are set annually, based on income according to the Social Security Act. For 2024, the monthly premium is $174.70, with the annual deductible being $240.
Medicare Part C: Medicare Advantage Plans
Medicare Advantage Plans, also known as Medicare Part C, are offered and managed by private insurance companies approved by Medicare. Essentially Medicare pays the insurance company to administer your Medicare benefits and your healthcare services are coordinated through the Medicare Advantage Plan.
Medicare Advantage Plans provide Part A and B coverage, but usually also include prescription drug coverage (Medicare Part D), as well as additional benefits like dental and vision plans, and wellness and fitness programs. These plans are structured like private health insurance plans, with a variety of plan types to choose from–HMOs, PPOs, health savings accounts (HSA), or even those similar to Original Medicare with a “fee-for-service” structure.
As Medicare Advantage plans are private insurance plans, they often have a set network of providers you choose from, with higher rates for out-of-network providers, and also have various premiums (beyond the Medicare Part B premium), based on the coverage and features of your plan and may have different cost-sharing requirements.
Medicare Part D: Prescription Drug Coverage
If you’re currently taking prescription drugs, you’ll want to be sure they’re covered when you move to Medicare. That’s because Part D prescription drug coverage is separate optional coverage and not included in Original Medicare.
All Medicare Part D plans are offered by private insurance companies and supplemented by Medicare. You can choose to add a private Medicare drug plan when you enroll in Original Medicare. If you choose a private Medicare Advantage Plan (Medicare Part C), your Part D coverage will be bundled with your Part A and Part B coverage, along with the additional benefits of the Advantage Plan.
The enrollment periods and deadlines for Medicare Part D are similar to those for all Medicare parts and plans. Missing your Part D enrollment period deadline and failing to have other “creditable coverage” can result in costly penalties added to your monthly drug plan premium when you do enroll.
Medicare Supplement Plans
While Medicare premium and deductible rates are lower than many traditional health insurance plans (even some employer-provided plans), there are still out-of-pocket costs. This is where a Medicare Supplement plan, or Medigap, comes in. These plans from private insurance companies are designed to work with Original Medicare, filling in the “gaps” or costs that Medicare Parts A and B do not cover, such as deductibles, copayments, and coinsurance. Your Medigap Open Enrollment Period begins the month you turn 65 and lasts for six months.
Turning 65 can mean greater choice and greater control over your healthcare coverage with your Medicare benefits. All those choices and decisions can also be overwhelming. Want to be confident in your Medicare decisions? Connect with the Wandacare Team! Our licensed Florida agents are here to guide you through every step of your Medicare journey.
