Generally, Medicare is available for people age 65 or older, younger people with disabilities and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant).
Medicare is divided into four parts and this can be a little confusing if you're new to Medicare.
- Medicare Part A (Hospital Insurance) - Part A covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care.
- Medicare Part B (Medical Insurance) - Part B covers certain doctors' services, outpatient care, medical supplies and preventive services.
- Medicare Part D (Prescription Drug Coverage) - Part D helps cover the cost of prescription drugs, as well as many recommended shots or vaccines.
- Medicare Part C (Medicare Advantage) - Part C Medicare Advantage plans are private health plans that you can choose instead of Original Medicare (Parts A & B). You would get your Part A and Part B coverage from a private insurance carrier, with many of the plans including Part D prescription drug coverage, as well. Advantage plans have provider networks (i.e. doctors, hospitals, clinics, etc.) from whom you would receive your care.
Original Medicare, Parts A & B, are regulated, managed and administered by the Federal Government, whereas, Part C Medicare Advantage and Part D Prescription Drug Plans are regulated by the government, but run by private insurance companies.
There are premiums associated with Medicare. If you or your spouse have worked at least 40 quarters (10 years) and paid Medicare taxes, you will pay $0 for your Part A premium. If you or your spouse have worked between 30 and 39 quarters (between 7.5 and 10 years) and paid Medicare taxes, you will pay a reduced Part A premium of $259 ($274 in 2022). Anyone who has worked less than 30 quarters would have to pay the full Part A premium of $471 ($499 in 2022).
Part A hospital inpatient deductible and coinsurance for 2021 and 2022: * $1,484 deductible for each benefit period ($1,556 in 2022) * Days 1-60: $0 coinsurance for each benefit period * Days 61-90: $371 coinsurance per day of each benefit period ($389 in 2022) * Days 91 and beyond: $742 ($778 for 2022) coinsurance per each "lifetime reserve day" after day 90 for each benefit period (up to 60 days over your lifetime) * Beyond lifetime reserve days: all costs
The standard Part B premium amount in 2021 is $148.50 (or higher if your income from 2019 was above $88,000/single or $176,000/joint). The standard Part B premium amount in 2022 is $170.10 (or higher if your income from 2020 was above $91,000/single or $182,000/joint). Part B deductible is $203 in 2021 ($233 in 2022). After your deductible is met, you typically pay 20% of the Medicare-approved amount for most doctor services (including most doctor services while you're a hospital inpatient), outpatient therapy, and durable medical equipment (dme)
Part C estimated average cost for plans in 2021 is $21/month according to CMS (must be paid in addition to the Part B premium) and an estimated $19/month in 2022. Max Out-of Pocket limit in 2021 and 2022 for Medicare Advantage Plans is $7,550, but plans may set lower limits.
Premiums for standalone Prescription Drug Plans (PDPs) in 2021 are estimated to be as high as $81 ($99 in 2022), but the estimated national average monthly PDP premium for 2021 is projected to increase to $41 and $43 in 2022, from $38 in 2020 according to KFF.org Deductibles vary between Medicare drug plans. No Medicare drug plan may have a deductible more than $445 in 2021 ($480 in 2022). Some Medicare drug plans do not have a deductible.
The Department of Health and Human Services generally advises filing for Medicare benefits 3 months before age 65 in order for coverage to start on the first day of your birth month. If you are already receiving Social Security, you should already be automatically enrolled in Medicare Parts A and B without an additional application. If for any reason you believe you may not already be enrolled in Medicare when first eligible to do so, i.e., you have not received your Part A & B Medicare card from Medicare, you should contact Social Security immediately. Because you must pay a premium for Part B coverage, you'll have the option of turning it down. However, late penalties will most likely incur if and when you do sign up if outside of the initial enrollment period (IEP), which is three months before your birthday month, your birthday month and three months after your birthday month. note: If your birthday falls on the first of any month, your IEP begins a month earlier.
Delaying Medicare should always be approached with forethought and caution to avoid possible permanent penalties and delays in coverage. Some people who are still working when they turn 65 and have employer-sponsored health insurance may consider delaying Medicare or just Part B of Medicare. The following fact sheet from CMS may help you to decide, but it's always best to get help from your employer's HR department and Social Security when making this important decision. Download: Deciding Whether to Enroll in Medicare Part A and Part B When You Turn 65
There are several ways to sign up for Medicare:
1. Visit the Social Security application page
2. Contact your local Social Security office
3. Call Social Security Toll-free at: 1-800-772-1213 (TTY 1-800-325-0778)
There are four ways you can pay your Medicare premiums:
1. Pay online through your secure Medicare account
2. Pay directly from your savings or checking account through your bank's online bill payment service
3. Sign up for Medicare Easy Pay, a free service that automatically deducts your premium payments from your savings or checking account each month
4. Mail your payment to Medicare
Medicare Supplement Insurance, or Medigap, helps fill the gaps in Original Medicare and is sold by private companies. Original Medicare pays for much, but not all, of the cost for covered health care services and supplies. A Medicare Supplement Insurance (Medigap) policy can help pay some of the remaining health care costs, like:
Learn more about Medicare Supplement Insurance here: Medigap
Medicare Supplement Insurance (Medigap) is managed and sold by private insurance companies. You can get Medigap from a number of companies, and although the coverage is standardized by the government, the cost of the plans may, and usually does, vary from company to company.
An independent agent or agency can shop for plans from several companies, which usually gives the consumer more choices relating to company strength and plan cost.
If you would like to hear about Medigap Plans that fit your specific needs, please call the number at the top of the page to speak with a licensed agent.
Sources: www.medicare.gov/, www.hhs.gov/, www.ssa.gov/