Most people in the United States become eligible for Medicare when they turn 65 years old. Having a Medicare checklist can help people keep track of the choices they need to make and the timeframes for doing so.
The months leading up to a person’s 65th birthday are a time of important decisions about healthcare coverage.
There are many decisions to make, and it is important to make them on time, as Medicare may charge financial penalties for skipping steps or missing deadlines.
This article discusses the different types of Medicare coverage available, some factors to consider in choosing a plan, and what happens after Medicare coverage begins.
We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:
- Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.
- Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.
- Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
The first step that someone can take to prepare for Medicare is to understand its different parts.
- Parts A and B: Part A covers inpatient hospital stays, and Part B covers outpatient medical costs. These parts make up original Medicare, which the federal government provides.
- Part C: Another name for Part C is Medicare Advantage. Private insurance companies offer Medicare Advantage plans as an alternative to original Medicare. The plans usually include prescription drug benefits.
- Part D: Also known as prescription drug plans (PDPs), these plans, which are also available from private insurance companies, provide prescription medications. A person who signs up for original Medicare can choose to add Part D coverage.
- Medigap: This is supplemental coverage that private insurance companies can offer. A person who has original Medicare can sign up for this optional coverage. It helps pay out-of-pocket expenses, such as coinsurance and Part A deductibles.
Someone who is turning 65 years old has a 7-month initial enrollment period (IEP) to sign up for Medicare.
The IEP includes the 3 months before a person turns 65 years old, the person’s birthday month, and the 3 months after their birthday month.
A person may wish to start researching the different types of plans well before their IEP begins. They will have a large amount of information to look through and many plans to choose from.
One of the main things for someone enrolling in Medicare to think about is whether to choose original Medicare or a Medicare Advantage plan.
Here are some of the key differences between those options:
|Original Medicare||Medicare Advantage|
|allows visits to any healthcare provider who accepts Medicare||may limit visits to a healthcare provider in the plans’ networks or charge more for receiving out-of-network healthcare services|
|does not cover most prescribed drugs, though a PDP is available to purchase||usually includes prescription drug coverage|
|does not require a person to choose a primary care physician||usually requires a person to choose a primary care physician|
|does not usually require referrals for specialist care||usually requires referrals for specialist care|
|does not have an out-of-pocket limit||usually has out-of-pocket limits|
|allows people to enroll in Medigap to over out-of-pocket expenses||does not allow people to enroll in a Medigap plan|
When first thinking about signing up for Medicare, a person may wish to consider:
- the enrollment periods for different types of coverage
- whether or not financial assistance is available
- whether they would like original Medicare or Medicare Advantage
- comparing plan coverage and costs
- choosing a plan and signing up before the deadline
After a person turns 65 years old and has signed up for Medicare Part B, they have a 6-month Medigap open enrollment period policy.
After this open enrollment period, a person may experience difficulty when trying to buy a Medigap policy, or it might cost more.
Medicare advises people to think about the following things when deciding on healthcare coverage:
- Benefits: If coverage for vision and dental services is important to a person, they should consider Medicare Advantage plans that offer such benefits.
- Providers: If an individual wants to keep visiting a particular doctor or pharmacy, they should see whether or not the provider is in a Medicare Advantage plan’s network. Original Medicare allows a person to use any doctor or hospital in the U.S. that accepts Medicare.
- Total cost: A person choosing a Medicare plan should compare costs, including premiums, deductibles, coinsurance, copayments, and out-of-pocket maximums.
- Plan ratings: Individuals comparing Medicare plans can also look at Medicare’s ratings of individual plans, ranging from 1 to 5 stars. The ratings consider the availability of preventive services, the management of chronic conditions, the results of member surveys, complaints, and customer service.
The Medicare website includes a tool that allows users to compare plans.
The resource provides cost information on original Medicare, PDPs, Medigap policies, and Medicare Advantage plans based on a person’s zip code.
If someone is receiving Social Security benefits before they turn 65 years old, Medicare will automatically enroll them in Part A and Part B when they become eligible.
Otherwise, a person should typically sign up for Part A and Part B during the 7-month IEP.
Someone who does not enroll when they are first eligible may face a penalty. For example, a person’s monthly Part B premium may increase by 10% for each 12-month period in which they were not enrolled.
Someone who is soon turning 65 years old may also sign up for a Medicare Advantage plan or a Medicare drug plan during the IEP. A person must first have Medicare Part A and Part B before enrolling in a Medicare Advantage plan or PDP.
People who do not enroll in Part D coverage when they are first eligible might have to pay a penalty if they decide to sign up at a later time.
A person who signs up for Medicare will receive a “Welcome to Medicare” pack, which includes their Medicare card, in about 2 weeks.
People who enroll in a Medicare Advantage Plan during the IEP have time to change their mind.
During the first 3 months of coverage, a person can change to a different Medicare Advantage plan or switch to original Medicare.
Medicare covers a “Welcome to Medicare” exam within the first 12 months of enrolling in Part B. This exam is optional and is often free when the healthcare provider accepts assignment, according to Medicare.
If a healthcare provider accepts assignment, it means that they have agreed to receive payment from Medicare at a Medicare-approved rate for the service.
However, a person may have to pay coinsurance if the healthcare provider carries out the exam at the same time as they deliver other preventive services.
The Medicare welcome exam typically includes:
Part A is premium-free for those who qualify having worked 40 quarters. When someone pays for Part A, Medicare sends a bill for the premiums every month.
Someone who enrolls in only Part B will receive a bill for their premiums every 3 months.
Medicare accepts payment online or by mail.
For those who are receiving Social Security retirement benefits, the government will automatically deduct Part B premiums from Social Security checks.
People enrolled in original Medicare typically do not need to file Medicare claims. Filing claims is the job of healthcare providers and suppliers, according to Medicare.
Someone with original Medicare can see a list of services that providers have billed to Medicare by checking the Medicare summary notice (MSN) that the agency mails out every 3 months.
An individual can also sign up to receive MSNs electronically by registering for a secure online Medicare account.
A person can also call Medicare at 800-633-4227 to ask questions.
In addition, each state has a State Health Insurance Assistance Program (SHIP) that provides personalized counseling on Medicare plans.
The SHIP National Technical Assistance Center has more details, including contact information for the SHIP in each state.
Choosing the right Medicare plan can be important to a person’s healthcare and finances.
A person who will soon be eligible for Medicare may wish to research their options ahead of time to ensure that they get a plan that best suits their needs.
There are many plan options available, and an individual can receive helpful advice from either the Medicare website or their local SHIP office.