WHAT IS MEDICARE?
Medicare is a Federal Health Insurance program that covers most people 65 years old and over, some people younger than 65 with disabilities, people diagnosed with amyotrophic lateral sclerosis (ALS), and those with end-stage renal disease (ESRD).
Medicare is divided into several parts. These parts are:
Part A – Hospital insurance – Covers most in-patient hospital care, some in-patient skilled nursing facility care, some home health care, and hospice care. – There is no monthly Part A premium for people who have 40 or more quarters of Social Security credits (about 10 years of full-time work with four quarters per year) and who are eligible for Social Security or Railroad Retirement benefits.
Part B – Outpatient medical services – Covers a portion of the Medicare approved costs for out-patient medical services such as doctors’ services, out-patient hospital care, laboratory tests, out-patient physical and speech therapy, some home health care, ambulance services, and some medical equipment and supplies. – Monthly premium is $104.90 (in 2015) for beneficiaries with individual incomes of $85,000 or less.
Part C – Medicare Advantage plans
Part D – Prescription Drug plans
Original Medicare doesn’t cover everything. If you need certain services that Medicare doesn’t cover, you’ll have to pay for them yourself unless you have other supplemental insurance or you’re enrolled in a specific Medicare health plan that covers these services. Some of the items and services that Medicare doesn’t cover include:
Long-term care
Most dental care
Eye examinations related to prescribing glasses
Dentures
Cosmetic surgery
Acupuncture
Hearing aids and exams for fitting them
Routine foot care
Even if Original Medicare covers and/or approves a specific service or charge, there may be additional costs you are responsible for that a Medicare Supplement (Medigap) Insurance policy would pay on your behalf.
MEDICARE SUPPLEMENT INSURANCE
Medicare Supplement insurance plans, also known as Medigap policies, are sold by private insurance companies. There are 10 standardized plans labeled A through N that pay for part, or all, of Medicare’s co-payments and deductibles. Some may also cover other health care costs that Medicare does not pay for, such as foreign travel emergency medical care. Curious about Medicare? The free resources to the right of this article are a great place to learn more. Feel free to contact us with any questions you may have.
10 Things you need to know about Medicare Supplement policies
You must have Medicare Part A and Part B to purchase a Medicare Supplement policy.
If you are applying for a Medicare Supplement plan outside of the Open Enrollment period, you may be subject to the carrier’s underwriting policies.
If you have a Medicare Advantage Plan, you can apply for a Medicare Supplement, but make sure you can leave the Medicare Advantage Plan before your Medicare Supplement policy begins.
You pay the private insurance company a monthly premium for your Medicare Supplement policy in addition to the monthly Part B premium that you pay to Medicare.
A Medicare Supplement policy only covers one person. If you and your spouse both want Medicare Supplement coverage, you’ll each have to buy separate policies.
You can buy a Medicare Supplement from any insurance company that’s licensed in your state.
Any standardized Medicare Supplement insurance plan is guaranteed renewable even if you have health problems. This means the insurance company cannot cancel your Medicare Supplement policy as long as you pay the premium.
Medicare Supplement do not include prescription drug coverage. If you want prescription drug coverage, you can join a Medicare Prescription Drug Plan, Part D, through the Medicare.gov website.
The insurance company cannot change the benefits covered by the plan, and cannot cancel the policy unless you fail to pay the monthly premium. The company can however, at its discretion, increase the premium you must pay.
Medicare Supplement policies generally don’t cover long-term care, vision or dental care, hearing aids, eyeglasses, or private-duty nursing.
RESOURCES
Medicare FAQs
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If you already get Social Security benefits, you do not need to sign up for Medicare. The Social Security Administration (SSA) will automatically enroll you in Original Medicare (Part A and Part B) when you become eligible. They will mail you the information a few months before you become eligible.
Because you must pay a premium for Part B coverage, you can turn it down. However, if you decide to sign up for Part B later, your coverage can be delayed and you may have to pay a late enrollment penalty for as long as you have Part B coverage. Residents of Puerto Rico or foreign countries will NOT automatically receive Part B. They must elect this benefit.
If you don’t get Social Security benefits and are not ready to apply for them yet, you should sign up for Medicare three months before your 65th birthday. The easiest way to apply for Medicare is by using the online application (https://secure.ssa.gov/iClaim/rib) or you can make an appointment by calling the SSA at 1-800-772-1213, 8am-7pm Monday through Friday.
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The best time to buy a Medigap policy is during your Medigap Open Enrollment Period. This is the 6-month period that starts the first day of the month you're 65 or older and signed up for Part B. After this period, your options to buy a Medigap policy may be limited and the policy may cost more.
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When your employer coverage ends, you'll have a chance to sign up for Part B without paying a late enrollment penalty. Your Medigap Open Enrollment Period will start once you sign up for Part B. After you sign up for Part B, you’ll have 6 months to buy a Medigap policy, even if you sign up while you still have employer coverage.
Employer coverage often provides coverage similar to Medigap, so you probably don't need to get a Medigap policy now. Contact your employer or union benefits administrator to find out how your insurance works with Medicare.
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If you have an older Medigap policy, you don’t have to switch. But, if you buy a new Medigap policy, you have to cancel your old policy (except for your 30-day “free look period”). Once you cancel your policy, you can’t get it back and because it’s not standardized, insurance companies can no longer sell it.
If you bought your Medigap policy before:
June 1, 2010: It may offer coverage that isn’t available in a newer Medigap policy.
1992: The company can refuse to renew your Medigap policy any year, and your policy may cost more than current Medigap policies.
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Medicare Advantage (also called Part C) is a Medicare-approved plan from a private company that offers an alternative to Original Medicare for your health and drug coverage. These “bundled” plans include Part A, Part B, and usually Part D.
In most cases, you’ll need to use doctors who are in the plan’s network. Plans may have lower out-of-pocket costs than Original Medicare. Plans may offer some extra benefits that Original Medicare doesn’t cover—like vision, hearing, and dental services.
Your Medigap policy can’t pay any Medicare Advantage Plan deductibles, copayments, coinsurance, or premiums, if you decide to keep your Medigap policy.
Keep in mind that if you drop your Medigap policy, in most cases you won’t be able to get it back, so pay attention to the timing.
In general, you can only join a Medicare Advantage Plan during the Medicare Open Enrollment Period between October 15 – December 7 each year. If you join during Open Enrollment, your Medicare Advantage Plan coverage will begin on January 1.
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Some of the items and services Medicare doesn't cover include:
Long-Term Care (also called custodial care), Most dental care, Eye exams (for prescription glasses) , Dentures, Cosmetic surgery, Massage therapy, Routine physical exams, Hearing aids and exams for fitting them, Concierge care (also called concierge medicine, retainer-based medicine, boutique medicine, platinum practice, or direct care), Covered items or services you get from an opt-out doctor or other provider (except in the case of an emergency or urgent need)