Medicare Basics

Medicare Information

As you transition into Medicare, it’s important to know the basics. Below is a breakdown of some helpful information.

Medicare Eligibility

Generally, you are eligible for Medicare if you or your spouse worked for at least 10 years in Medicare-covered employment, and you are 65 years old and a citizen or permanent resident of the United States.

If you are not 65, you might also qualify for coverage if you have a disability or end-stage renal disease (permanent kidney failure requiring dialysis or transplant).

Medicare Parts A and B

Medicare has two main parts: Part A is hospital insurance. Part B is medical insurance. Premiums for each part work differently:

Part A – Hospital Insurance: Most people don’t pay a premium for Part A because it has already been paid for through payroll taxes while working.  Medicare Part A (hospital insurance) helps cover inpatient care in hospitals, including critical access hospitals and skilled nursing facilities (but not custodial or long-term care). It also helps cover hospice care and some home health care. Beneficiaries must meet certain conditions to get these benefits.

Part B – Medical Insurance: Most people pay a monthly premium for Part B. Medicare Part B (medical insurance) helps cover doctors’ services and outpatient care. It also covers some other medical services that Part A doesn’t cover, such as some of the services of physical and occupational therapists and some home health care. Part B helps pay for these covered services and supplies when they are medically necessary.

Medicare Part C Advantage Plans

Medicare Advantage Plans, sometimes called Part C, are health plan options that are part of the Medicare program. A Medicare Advantage Plan is a type of Medicare health plan offered by a private insurance company that contracts with Medicare to provide you with all your Part A and Part B benefits.

If you join one of these plans, you generally get all your Medicare-covered health care through the Medicare Advantage Plan. This coverage can include prescription drug coverage. Medicare Advantage Plans include:

  • Medicare Health Maintenance Organization (HMOs)
  • Preferred Provider Organizations (PPO)
  • Private Fee-for-Service Plans
  • Medical Savings Accounts (MSA)
  • Medicare Special Needs Plans

How the Advantage Plan Works With Parts A and B

When you join a Medicare Advantage Plan, you use the health insurance card that you get from the plan for your health care. In most of these plans, there generally are extra benefits and lower co-payments than in the original Medicare plan. Most Medicare Advantage Plans are managed care plans, usually a health maintenance organization (HMO) or a preferred provider organization (PPO), and you may have to see doctors that belong to the plan or go to certain hospitals to get services.

Medicare Part D

Medicare Part D offers prescription drug plans. You can sign up for Part D, along with other components of Medicare starting three months before your 65th birthday.

It’s important to do this on time because there’s a permanent premium surcharge for enrolling more than three months after your 65th birthday if you don’t have equivalent drug coverage from another source, such as a retiree plan.

Medicare Supplement/Medigap Plans

A Medicare Supplement (Medigap) insurance, sold by private companies, can help pay some of the health care costs that Original Medicare doesn’t cover, like co-payments, coinsurance, and deductibles.

If you have original Medicare and you buy a Medigap policy, Medicare will pay its share of the Medicare-approved amount for covered health care costs. Your Medigap policy pays its share.

A Medigap policy is different from a Medicare Advantage Plan. Those plans are ways to get Medicare benefits, while a Medigap policy only supplements your original Medicare benefits.

Here’s are some important things to know about Medigap policies:

  1. You must have Medicare Part A and Part B.
  2. If you have a Medicare Advantage Plan, you can switch to a Medicare Supplement insurance policy, but make sure you can leave the Medicare Advantage Plan before your Medicare Supplement insurance policy begins.
  3. You pay the private insurance company a monthly premium for your Medicare Supplement insurance policy. This is paid in addition to the monthly Part B premium that you pay to Medicare.
  4. A Medigap policy only covers one person. If you and your spouse both want Medigap coverage, you’ll each have to buy separate policies.
  5. You can buy a Medicare Supplement insurance policy from any insurance company that’s licensed in your state to sell one.
  6. Any standardized Medicare Supplement insurance policy is guaranteed renewable even if you have health problems. This means the insurance company can’t cancel your Medicare Supplement insurance policy as long as you pay the premium.
  7. Medicare Supplement insurance policies sold after January 1, 2006, aren’t allowed to include prescription drug coverage. If you want prescription drug coverage, you can join a Medicare Prescription Drug Plan (Part D).
  8. It’s illegal for anyone to sell you a Medigap policy if you have a Medicare Advantage plan unless you’re switching back to original Medicare.

You don’t have to navigate all of this alone! Schedule an appointment with Thomas Marchant to get all your questions answered and find the perfect plan for you or a loved one…at no cost to you!

Portions of this page were sourced from medicare.gov.