Turning 65 is a significant milestone for many individuals in the U.S., as it marks the age at which you become eligible for Medicare, a federal health insurance program that provides coverage for seniors and certain younger individuals with disabilities. Here are 10 important facts that someone turning 65 should know about Medicare:
Eligibility: Most people become eligible for Medicare when they turn 65, regardless of their income or medical history. You can enroll in Medicare during a seven-month period, which includes the three months before your 65th birthday, your birthday month, and the three months after your birthday. Enrolling prior to your birth month will help avoid unnecessary delays in coverage.
Parts of Medicare: Medicare consists of different parts, each covering specific healthcare services:
Part A: Hospital Insurance - Covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care.
Part B: Medical Insurance - Covers outpatient medical services, doctor's visits, preventive care, and some medical equipment.
Part C: Medicare Advantage - Offers private insurance plans that combine Part A and Part B benefits. Many Medicare Advantage plans also include prescription drug coverage (Part D).
Part D: Prescription Drug Coverage - Helps pay for prescription medications that are picked up at a pharmacy.
Original Medicare vs. Medicare Advantage: You have the option to choose between Original Medicare (Part A and Part B) and Medicare Advantage (Part C). Original Medicare is administered by the federal government and allows you to see any Medicare-approved healthcare provider. Medicare Advantage plans are offered by private insurance companies and may have network restrictions but often include additional benefits like dental, vision, and prescription drug coverage.
Enrolling in Medicare: If you're already receiving Social Security benefits when you turn 65, you will be automatically enrolled in Medicare Parts A and B. If not, you can sign up for Medicare through the Social Security Administration. You can do this online, in person at a Social Security office, or by calling Social Security.
Costs: While some parts of Medicare, like Part A, are usually premium-free for most enrollees, you will have to pay monthly premiums for Part B and any additional coverage you choose, such as Part D or Medicare Supplements. There may also be deductibles, copayments, and coinsurance costs, so it's important to understand the expenses associated with each part.
Medicare Supplements (Medigap): If you choose Original Medicare, you may want to consider purchasing a Medigap policy to help cover out-of-pocket costs like copayments and deductibles. Medigap plans are offered by private insurance companies and can provide additional financial protection.
Prescription Drug Coverage: If you opt for Original Medicare, you may want to consider enrolling in a standalone Medicare Part D plan to cover your prescription medications. Alternatively, you can choose a Medicare Advantage plan that includes prescription drug coverage. It is important to enroll in one of these plans to avoid a penalty later on for not having credible drug coverage.
Open Enrollment Periods: There are specific enrollment periods for Medicare, including the Initial Enrollment Period, General Enrollment Period, and Annual Enrollment Period (for Medicare Advantage and Part D). It's essential to understand these periods and enroll or make changes accordingly.
Health Savings Accounts (HSAs): If you have an HSA and plan to continue contributing to it after enrolling in Medicare, be aware of the rules regarding HSA contributions and Medicare to avoid tax consequences.
Consult with an Expert: Understanding Medicare can be complex, and the right choices depend on your unique healthcare needs and financial situation. Contact us for more information on how and where to apply and a free, no obligation assessment of your needs.
It's crucial to plan ahead and make informed decisions about your Medicare coverage to ensure you have the healthcare benefits you need as you transition into retirement and don’t make any costly mistakes. Allow yourself 2 to 3 months to manage the transition to Medicare. You don’t have to do it alone, so contact us for help understanding and navigating the system.