Medicare, as a federal health coverage program, is intended to help provide access to healthcare for those who may not get it through an employer. Often, this means retirement age, which in the United States is age 65. Once you turn 65, you have aged into Medicare eligibility.
If you’re approaching your 65th birthday, it’s important to understand what Medicare options are available to you. While you may be automatically enrolled in Medicare, it’s possible that the default options are not the coverage that’s best for your situation. This guide will answer common questions and help you choose the Medicare plan that’s right for you or your family member. Medicare is for the nation's elderly and certain individuals with qualifying disabilities However this article will focus on those aging into Medicare.
Are you or someone you care about turning 65? Turns out, you’ll be joined by thousands of birthday buddies.
In fact, 10,000 Americans turn 65 every day - a real cause for celebration, whether it’s the milestone of retirement or your journey to the right Medicare coverage.
Still, many Americans are confused by Medicare: how to enroll, when their enrollment period is and what plan to even enroll in. But the process doesn’t need to be so complex. In this guide, we’ll help you understand what you should do when you’re aging into Medicare. Remember that while age is one trigger for being eligible for Medicare, it’s not the only one.
Approaching age 65 may bring a lot of changes into your life. As you look at your Medicare options, you may have some of the questions we address below.
Because Medicare can be a complex subject, it pays to start learning early. There’s nothing wrong with beginning to review Medicare rules in your state, along with the available options, in your early 60’s. By the time you turn 64, it’s a good idea to start looking into specific plans.
Your initial enrollment period will start three months before your 65th birthday, include your birthday month, and extend three months afterward. You’ll have unique options in your initial enrollment period that will not happen again, like guaranteed acceptance into a Medigap plan, so it’s important to make the right Medicare plan choices from the very beginning.
Many people who turn 65 will be automatically enrolled in Medicare if they are already receiving social security retirement benefits or other retirement payments. It is not mandatory to enroll in Medicare at age 65, but you might pay a financial penalty if you delay your enrollment.
Medicare Part A is premium-free for most people, so there’s no harm in enrolling in that coverage immediately. Medicare Part B, which covers outpatient care, doctor’s visits, and more, does have a monthly premium. If you defer enrollment in Part B because you have a qualifying employer coverage through your job or a spouse, you won’t have to pay a late enrollment penalty when you do sign up for Medicare Part B.
If you do not sign up for Medicare Part B during your initial enrollment and you don’t have qualifying coverage, when you do decide to enroll in Part B you will need to pay a late-enrollment penalty.
As you approach age 65, you’ll want to make a note of the different enrollment periods that affect Medicare recipients. AEP stands for Annual Enrollment Period. You can make any change or update to your Medicare plan each year between October 15 and December 7th. Coverage changes go into effect on January 1. Learn more about annual enrollment periods.
The OEP is the Medicare Advantage Open Enrollment Period, which runs from January 1 to March 31 each year. During this time you can make changes to your Medicare Advantage plan or go back to Original Medicare. You can learn more about Medicare enrollment periodshere.
Special Enrollment periods happen due to specific life events. For example, if you move out of a plan’s service area, have a chance to get other coverage, or lose current coverage, you may get a special enrollment period. This guide gives more information about special enrollment periods.
If you don’t sign up for Medicare during your initial enrollment period, you may be penalized with higher premium if you do decide to enroll later. Every year, you may enroll in Part A or Part B during the General Enrollment Period from January - March.
Now that you know the eligibility requirements and when to enroll, follow these tips to prepare for Medicare enrollment.
Most people qualify for Medicare Part A because of their work history. If you’re a U.S. citizen or permanent legal resident, you qualify for premium-free Part A as long as you have paid payroll taxes for at least 10 years.
Call your local Social Security Office to see if you’re eligible for Medicare Part A. You may receive a paper statement from SSA [sample here] as a reference, or you can create an account online at ssa.gov.
You may still qualify for Medicare Part A through your spouse if you don’t (or won’t) have 40 quarters of work history. You’re eligible if your spouse qualifies for premium-free Part A, and:
If you don’t meet any of these criteria, you can either continue working until you’ve logged 40 quarters, or pay for Part A. For 2022, the Part A premium is $499 per month, but this amount may be reduced if you have some work history.
If you are currently employed and you are covered by an employer health plan, and your employer has more than 20 employees, you don’t have to sign up for Part B until you retire and give up your employer-based health coverage.
Many people can’t take full Social Security benefits until age 66, so it’s common to delay retirement by a year. You can delay Part B as long as your employer coverage meets Medicare’s minimum requirements.
But if you work for a small company with less than 20 employees, you’ll probably need to enroll in Part B when you’re first eligible. Be sure to talk about this with your employer before your 65th birthday. There’s no reason to pay the Part B premium until you’ll actually need Medicare.
There are a few nuances to receiving Social Security and how it impacts when you can enroll in Medicare Parts A and B:
Make sure the doctors you see, or want to see, accept Medicare. Finding out ahead of time can help you avoid surprises.
If you plan to move during your retirement, it’s wise to get recommendations for doctors in your new hometown and see if they accept Medicare patients.
When it comes to medications and aging into Medicare, there are 3 steps to take:
Medicare doesn’t cover 100% of your health care costs. Instead, you’ll pay a portion out of your own pocket. The costs you pay for Part A differ from what you’ll pay for Part B.
Part A will cover you for inpatient type of events, like:
When you have a hospital stay, you’ll have to pay the Part A deductible. For 2022, the deductible is $1,556. You’ll pay this inpatient hospital deductible each time you are admitted to the hospital, provided you haven’t received hospital or skilled nursing facility services within the previous 60-day benefit period.
Part B of Original Medicare covers the services you’d receive in an outpatient setting, including:
When you use Part B coverage, you can expect to pay out of pocket for each service. Your share of cost can include:
The biggest Part B expense is the 20% coinsurance, which you’ll pay throughout the year. There are other costs you can expect to pay out of pocket with Original Medicare, including things like dental care, eye exams, hearing aids, and more.
Keep in mind that there is no cap on how much you can spend out of pocket with Original Medicare.
Make sure any Medicare plan you consider:
You can also narrow your choices down further by asking yourself:
If you spend a lot of time travelling or living in a second home, you’ll want to consider Medicare Supplement Insurance. But if you’re comfortable with a particular HMO-type medical group and plan to live in one place, then Medicare Advantage could be right for you.
There are Medicare plans available that help close the coverage gap of what Original Medicare doesn’t cover. They include:
Medicare Advantage plans, also known as Medicare Part C, is a contract between a private insurer and Medicare. These plans must cover everything that Original Medicare covers.
Medicare Advantage plans work like traditional private health insurance, so you may see certain out-of-pocket costs with Medicare Advantage, including:
Medicare Advantage plans also offer a number of added benefits, which vary by state and health plan. Some benefits include:
Medicare Advantage plans can also provide emergency coverage outside the United States. With the international coverage, out of pocket maximum protection, and a wide range of extra benefits, you can see why many people choose Medicare Advantage plans.
Prescription Drug plans (PDPs or Medicare Part D) help with the cost of prescription drugs. Each company creates their PDPs differently, but you can expect to pay these costs for coverage:
The copayments and coinsurance costs increase as the total amount your plan pays rises above certain thresholds, also known as coverage stages:
Coverage Stage 1 – Deductible Stage: You pay full price until you’ve spent $480 (for 2022).
Coverage Stage 2 – Initial Coverage Stage: You pay small copayments or coinsurance for each prescription.
Coverage Stage 3 – Coverage Gap Stage: Also known as the Medicare “Donut Hole.” Once your total drug costs (what you’ve paid plus what your plan has paid) exceed $4,020, you hit the coverage gap. You’d then pay 25% of the cost of prescriptions.
Coverage Stage 4 – Catastrophic Stage: Once your total drug costs (excluding what your plan has paid) exceed $6,350, you pay no more than 5% for medications
These coverage stages reset on January 1 each year. But it’s important to know that there is no out-of-pocket cap on drug costs under Part D.
Click the link if you want to more about the phases of Medicare Part D.
Medicare Supplement Insurance, also known as Medigap, is designed to fill the gaps in Original Medicare. Medigap supplements Original Medicare by paying some or all of the expenses that you’d normally have to pay out of pocket.
Medigap policies are issued in 10 standardized plans: A, B, C, D, F, G, K, L, M, and N. Each of these plans cover a slightly different portion of the Original Medicare gaps.
Plan G is a popular Medigap option that covers every gap except for the Part B deductible. If you have Plan G, you can expect to pay for the first $198 in Part B expenses (like doctor’s visits). Plan G will then cover every penny of any Medicare-approved service or procedure.
Several Medicare supplements provide some international coverage, including plans C, D, F, G, M, and N.
Medigap plans also give you maximum flexibility, so you can see any doctor or use any facility that accepts Medicare patients, anywhere in the United States. You’re not bound to a network, or reliant upon referrals.
Medicare Supplement Insurance plans don’t cover prescription drugs, so you’ll need to enroll in a stand alone Prescription Drug plan to get drug coverage.
Make sure any Medicare plan you consider:
You can also narrow your choices down further by asking yourself:
If you spend a lot of time travelling or living in a second home, you’ll want to consider Medicare Supplement Insurance. But if you’re fine with HMO-type medical groups and plan to live in one place, then Medicare Advantage could be right for you.
As you approach age 65, it’s important to start your research sooner rather than later. Make sure you know what plans your doctors will accept, and which plans cover your medications.
Comparing Medicare plan features and costs doesn’t have to be complicated though. You can get Medicare quotes through our site. Or you can call 800-620-4519 to reach one of our licensed Medicare agents who can guide you through your Medicare plan options.