If you’re getting ready to retire or about to turn 65 years old, you will need to make some important decisions about your healthcare in the near future.  The best way to educate yourself about what choices you have, especially as they related to Medicare, is to start early and do your homework.  The choices you make will have a material impact on your life going forward.  You will want to decide what kind of coverage you want, know when to enroll so that you don’t have to pay a fine or have any gaps in your coverage, as well as making many other key choices.

Several months before you turn 65, you should begin to familiarize yourself with an overview of Medicare, and understand Parts A, B, C, and D, and implications of choosing whether or not to initiate coverage.  You should also ask questions about how Medicare will dovetail into your existing healthcare coverage.  With too little coverage, you could get stuck will some large expenditures. With too much coverage, you could be paying unnecessary premiums in the future.

Understanding the different parts of Medicare

Medicare is broken into four parts; A, B, C and D.

  • Medicare Part A provides hospital insurance in the form of inpatient hospital stays, care in skilled nursing facilities, hospice and some home health care situations.
  • Medicare Part B covers many doctors’ services, outpatient care and services, medical supplies and an array of preventative services.
  • When you turn 65, you are automatically enrolled in Part A and you have the option of also enrolling in Part B (for a small premium) as well.  Most people will pay the standard premium amount of $134 in 2018.
  • Medicare Part C is also known as Medicare Advantage.  These are private health plans that contract with Medicare to provide services and typically include HMOs and PPOs.  Medicare Part C plans must cover all the same services as Part A, but they may also cover added services as well.  This may include things such as eye exams, hearing exams and other types of add-on services.  Some plans also include prescription drugs coverage as well.  Because Part C is optional, you will end up paying a premium if you choose to go this route. 
  • Medicare Part D provides prescription drug coverage.  Under Part D, the Federal government subsidizes the costs of prescription drugs and drug insurance premiums.  You can get Part D coverage as a stand alone benefit, or it can be included in Part C coverage.

What to know about enrolling

The first time you can enroll in Medicare is called your Initial Enrollment Period.  It is the 7-month timeframe that usually begins 3 months before you turn 65, the month you turn 65, and the 3 months after you turn 65.  If you don’t enroll during this time period and want to enroll later on, you may have to pay a late enrollment penalty for Part B.  In additional you may also have a gap in your healthcare coverage if you don’t act during the initial period. 

For more information

There is a wealth of information online for you to better understand your options and the timeframes you should be concerned with as you approach becoming a member of Medicare.

The government maintains a comprehensive site that gives detailed information about all aspects of Medicare.  You can access it here.

The National Council on Aging in partnership with Aon Retiree Health Exchange offers an educational service that helps people make informed choices regarding their healthcare coverage.  There is also individualized assistance available at no cost to help find the coverage that best fits your personal situation.