Medicare

Medicare guarantees health insurance for people at age 65, after they have received Social Security disability benefits for at least 24 months, or if they have end-stage renal disease or have amyotrophic lateral sclerosis (also known as Lou Gehrig’s disease). According to the National Committee to Preserve Social Security and Medicare, of the nearly 51 million Americans who were Medicare recipients in 2012, about 42.1 million of them were over age 65, which I feel makes having a Medicare strategy to manage healthcare costs a crucial component of retirement planning.

Think of it this way, like Social Security, Medicare is a federal social insurance program that you have paid into throughout your career. Don’t you want to know how to get the most out of what you have put it in?

For millions of retirees, their Medicare coverage often means the difference between either insulating their retirement savings from medical costs – or quickly depleting them. To ensure you belong to the former, let’s examine the four basics of any insurance plan: coverage, eligibility, enrollment and premium cost – as they relate to Medicare.

Medicare Coverage:

Deciding how to get your Medicare coverage begins with first knowing what type of coverage you need.

Medicare is split into four parts:

  • Part A: Hospital insurance – covers the costs of health care at medical facilities. Offers coverage for medically necessary inpatient care at hospitals, skilled nursing facilities, hospices and home health services.
  • Part B: Medical insurance – covers the costs of health care outside medical facilities. Offers coverage for doctors’ services, hospital outpatient care, home health care, mental health and some preventative health care services.
  • Part C: Medicare Advantage (MA) plans – policies you can purchase from certain private insurance carriers that provide the same (or more) coverage as Parts A and B.
  • Part D: Prescription drug coverage offered through private Medicare-approved insurance companies.

Eligibility

In general, a person is entitled to receive Medicare at age 65, after they have received Social Security disability benefits for at least 24 months, if they have end-stage renal disease, or if they have amyotrophic lateral sclerosis (also known as Lou Gehrig’s disease).

Enrollment

Enrollment in Parts A and B is automatic for anyone who is 65 years old and already receiving Social Security, diagnosed with ALS or under age 65 and receiving disability benefits. For individuals eligible for Medicare but who do not qualify for automatic enrollment, they can sign up to receive Parts A and B during an enrollment period.

If you don’t plan on filing for Social Security when you turn 65, it’s important to enroll for Parts A and B during the three months prior to your 65th birthday. Failing to do so will delay your coverage and may result in late penalty fees.

Parts C and D, on the other hand, are offered through private insurance companies, which means if you decide you want this coverage type, you must purchase one of these policies during an enrollment period. Keep in mind that if you don’t sign up for Part D when you’re first eligible, your premiums may be subject to penalty.

The Burton Group as a local independent agency-due to its AHIP Medicare certification and its representation of Medicare supplements, PDP plans, and Medicare Advantage-is able to fully answer questions regarding ALL areas of the Medicare marketplace. The Burton Group is locally operated and owned in Bloomington, IN. Contact us today to help you understand your best option for you and your loved one.