Medicare
Medicare is a federal health insurance program for people aged 65 or older and certain people under 65, including those with disabilities and those suffering from permanent kidney failure or amyotrophic lateral sclerosis (Lou Gehrig’s disease).
Medicare helps cover healthcare costs, but it does not cover all medical expenses, nor does it cover the cost of prescription drugs and long-term care.
Medicare is funded by the federal government through payroll taxes paid by employees and their employers. It is also partially funded by deductions to the
Social Security fund.
The Centers for Medicare & Medicaid Services is the government agency responsible for the Medicare program.
You should apply for Medicare Part A and B at Social Security offices, where you can also get information about the program.
Types of Medicare
- Part A – Hospital Insurance. Helps cover inpatient hospital care and skilled nursing facility care (after a hospital stay).
- Part B – Medical Insurance. Helps cover doctors’ services and other medical services not covered by Part A (hospital insurance).
- Part A and Part B insurance do not cover the entire cost of treatment!
- Part C – Medicare Advantage. This is insurance offered by insurance companies, but supervised and mostly or entirely funded by the government. It covers hospital treatment costs, doctors’ services costs, and in many cases, prescription drug costs. In many regions, these plans are free.
- Part D – Prescription Drug Plans. Plans offered by insurance companies that help cover the cost of prescription drugs. Lack of Part D may result in financial consequences (penalties) in the future.
- Medicare Supplement (Medigap). These are private insurance plans designed to cover hospital and treatment costs not covered by Part A and Part B. These plans are supervised but not funded by the federal government. The government agency CMS sets the standards that individual plans must meet. These plans are: A, B, C, D, F, G, K, L, M, and N. Not all plans must be available in every state, and not all must be offered by insurance companies. Currently offered Medigap plans do not provide drug coverage. Purchasing a Medigap plan requires purchasing a separate Part D Plan (for prescription drugs).
Medicare Enrollment Periods
- Part A and B. Enrollment in the basic parts of Medicare occurs automatically if a person reaches age 65 and is receiving or intends to start receiving Social Security retirement benefits. People delaying their retirement date should apply for Medicare themselves at Social Security. Initial enrollment lasts for 7 months (3 months before, the month of birth, and 3 months after the month of the 65th birthday).
- Part C (Advantage) and Part D. Enrollment in these plans is voluntary, but an unjustified delay in enrolling in Part D may have financial consequences (penalties) in the future.
- Enrollment in Part C and D is only possible if you have a Medicare card with Part A and Part B!
There are several possible enrollment periods for these plans:
- IEP (Initial Enrollment Period) for people turning 65. Initial enrollment lasts for 7 months (3 months before and 3 months after the month of the 65th birthday).
- AEP (Annual Enrollment Period). Annual enrollment is from October 15 to December 7. During this period, we can join new plans or switch to others.
- Disenrollment Period (Period to disenroll and return to original Medicare A and B) is possible between January 1 and February 14.
- SEP (Special Enrollment Period). Special enrollment is only possible for people who have moved, lost another type of insurance, e.g., employer-sponsored, or qualify for Medicaid or another assistance program, e.g., LIS, MSP, EPIC, etc.
- Medicare Supplement (Medigap). Enrollment in Medigap plans can occur throughout the year, but it is usually most advantageous to enroll within 6 months after turning 65. A requirement for purchasing a Medigap plan is having Medicare Part A and B.
- When enrolling in this type of plan, you cannot simultaneously be a member of Part C (Advantage) or another Medigap plan.
Need more information about Medicare? Please call.
