In some cases, a person automatically qualifies for original Medicare. In other instances, a person must apply for Medicare and will need certain documents.
This article looks at the Medicare plans and examines how and when to enroll. It also discusses the documents needed and costs.
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.
Medicare is a federal health insurance program that provides hospital and medical healthcare coverage for people aged 65 and older, and for some people with disabilities.
The program has several parts including original Medicare (Part A and Part B), Part C also known as Medicare Advantage, and Part D, that provides coverage for prescription drugs
Part A is coverage for inpatient hospital stays, such as an acute care hospital, rehabilitation facility, and long-term care hospital. Coverage provided by Part A may include:
- nursing care
- semi-private room
- medication given while a person is an inpatient
- labs and imaging while inpatient
Part B covers various medically necessary services a person receives as an outpatient. Typically, Part B covers:
- visits to a doctor’s office
- ambulance transport
- health screenings, such as cancer screening tests
- durable medical equipment
- rehabilitation therapies, such as physical and occupational therapy received as an outpatient
Part C is also known as Medicare Advantage. The plans offer the same coverage as original Medicare and may have additional benefits such as hearing services and dental care. Private insurance companies offer Advantage plans.
Part D is coverage for prescription drugs. A person enrolled in original Medicare may get the optional Part D plan from a private insurance provider. Medicare Advantage plans sometimes combine Part D coverage.
Original Medicare does not pay for all costs, and a person may have to pay certain out-of-pocket expenses, such as deductibles, coinsurance, and copays. A Medigap policy is designed to help a person cover those costs.
Enrollment in Medicare is based on several eligibility factors and individual circumstances, including a person’s age and whether they already receive Social Security or Railroad Retirement Board benefits.
For example, eligibility for Medicare means a person must be aged 65 or older, or under 65 and living with a disability. A person of any age is eligible for Medicare if they have end stage renal disease or permanent kidney failure that needs treatment or dialysis.
In addition, a person must either be a United States citizen or have been a permanent legal resident for a continuous period of 5 years and be eligible for Social Security benefits and have been making payments for at least 10 years.
The documents needed to enroll in original Medicare parts A and B include a birth certificate, driver’s license, and proof of U.S. citizenship or legal residency.
There are several Medicare enrollment periods.
Initial enrollment period
The initial enrollment period (IEP) is 7 months, which includes the 3 months before a person is 65 years old, the birthday month, and the following 3 months.
Many people are automatically enrolled in Medicare when they turn 65 and have had Social Security benefits or Railroad Retirement benefits for at least 4 months.
However, if a person is not automatically enrolled, they can on the Social Security administration website or in person at their local Social Security office.
A person can also call the Social Security Administration at 1-800-772-1213, or mail a signed letter to the Social Security office that includes the applicant’s name, the date for enrollment to start, and the person’s social security number.
If a person wants proof of their Medicare enrollment, they can print the online confirmation page, ask for a receipt if they apply in person, or use certified mail.
What parts of Medicare can I enroll in during the IEP?
During the IEP, a person can enroll in original Medicare (Part A and Part B), and Part C, also known as Medicare Advantage. A person can also enroll in Part D at the same time as in original Medicare.
In addition, a person who has a Medicare Advantage plan can enroll in Part D if their plan does not cover prescription drugs.
If a person delays enrolling during the IEP, their Medicare coverage may also be delayed, and they may have a late enrollment penalty.
With Medigap, the person can lose the ability to gain coverage with pre-existing conditions.
General enrollment period
The general enrollment period (GEP) is annually from January 1–March 31, and coverage generally starts on July 1. If a person did not enroll during the IEP, they can enroll during the GEP.
During the GEP, a person can enroll in original Medicare, and, if they have an Advantage plan, can switch to another plan or to original Medicare. However, a person with original Medicare cannot switch to an Advantage plan during the GEP.
Open enrollment period
The open enrollment period (OEP) is from October 15–December 7 annually.
During the OEP, a person can switch from original Medicare to an Advantage plan, or from an Advantage plan to original Medicare.
A person may also switch between Advantage plans, or enroll in or cancel a Part D prescription drug plan.
Special enrollment period
During the special enrollment period (SEP), a personcan enroll in Medicare in specific circumstances, such as when moving in or out of a skilled nursing facility or after losing other health insurance such as through an employer.
A person can enroll in original Medicare parts A and B during the SEP, which generally lasts for 8 months.
The cost for enrolling in Medicare depends on a few factors, such as income and calendar quarters a person has accumulated while working.
In 2021, there are various cost associated with enrolling in Medicare.
Premiums for Part A depend on how many quarters a person has worked. If a person has worked 40 quarters in their lifetime, Part A is premium free. However, if a person has between 30–39 quarters, the monthly premium is $259. The cost of the monthly premium increases to $471 for people that worked less than 30 quarters.
A person will also have to pay a deductible of $1,484, and coinsurance.
If a person is 65, they could be eligible for premium free part A based their spouse’s work history. This eligibility applies to the following people:
- A person who is married for at least 1 year and their spouse is eligible for social security benefits.
- A single person who is divorced but had been married for at least 10 years and the divorced spouse is eligible for social security benefits.
- A widowed single person who had been married at least 9 months before the spouse died.
The basic Part B monthly premium is $148.50. However, if a person’s annual income is more than $88,000, the monthly premium may increase.
The deductible is $203, and a person generally pays 20% coinsurance.
Premiums for Part C, Advantage plans, vary depending on the plan and the provider. A person can check online to find plans and costs.
The cost for Part D plans depends on the individual plan, the drugs available in the plan, and a person’s income. A person can compare Part D costs using this online tool.
Medigap plans also vary in cost and coverage. The plans are identified by a letter and are standardized across most states.
This online tool can help a person compare Medigap plans.
Some people automatically qualify for original Medicare. However, a person may need to enroll in the various Medicare parts, including original Medicare (Part A and Part B), Part C, and Part D. There are several enrollment periods throughout the year, plus a special enrollment period.
The documents needed to enroll in Medicare Part A and B include a birth certificate, driver’s license, and proof of U.S. citizenship or legal residency.