Medicare

Medicare Basics: What You Need to Know

What is Medicare health insurance?

If you’re asking what Medicare is in a nutshell, here’s your answer: Medicare is a federal health insurance program for people who are 65 or older. No matter when you’re planning to retire, you will become eligible for Medicare when you turn 65 and can sign up for a plan three months before your birthday. In special cases this program also covers health insurance for people with disabilities and people who are dying from end-stage renal diseases like kidney failure.

What do the different Medicare plans cover?

There are four separate tracks of Medicare, and each one covers specific medical needs:

  • Part A—this plan covers hospital stays, nursing facility care, hospice care, and some home health care. If you or your spouse have contributed to the Social Security fund for at least 10 years, this plan is free. Otherwise this plan comes with a monthly fee.
  • Part B—This plan covers doctor’s visits, preventative care, outpatient care and hospitals, and some home health care. If your yearly income is less than $85,000 per year, this plan is $104.90 per month. Higher income earners have to pay much more.
  • Part C—Also known as the Medicare Advantage plan, this plan replaces both A and B and often part D too. Most part C plans cover health maintenance organizations, preferred provider organizations, private fee-for-service plans, special needs plans, and Medicare medical savings account plans. Premiums range from $0–$100 depending on your location and coverage.
  • Part D—This plan is specifically for covering prescription drugs. Mostly it’s offered by insurance companies approved by Medicare, and the premiums usually range from $0–$50 per month. If you aren’t taking prescription medications at the time you sign up for Medicare, it’s best to leave this part off your plan and add it later when you actually need it.

Most people who go onto Medicare choose either a traditional Medicare plan (A and B) or a Medicare Advantage plan (C). All Medicare plans come with the typical deductibles and copays, but Medicare Advantage usually comes with lower premiums since you must see doctors in a specific network. Recipients are allowed to choose which type of plan they want based on their income, situation, and unique health needs.

Is Medicare a “sign up once” kind of deal?

Technically no. Even if you’ve been on Medicare for years it can be in your best interest to reevaluate and make sure that you’re on the right plan for you. Do research and seek out professional advice if you need it. Call your insurance provider to ask questions or take a look at AARP.org or the Consumer Reports website.

For even more information regarding Medicare and how it can cover you, visit Medicare’s official website at medicare.gov.