Did you know that a new person becomes eligible for Medicare every eight seconds? This impressive figure demonstrates the importance of that government-funded health insurance for people age 65 or with certain health conditions. If you’re among those approaching this milestone or have recently become disabled, this quick guide has important details you need to know before signing up for Medicare.
What Is Medicare?
Medicare is a type of health insurance funded by the federal government. In general, this health insurance program is open to all U.S. citizens and legal residents age 65 and older, but exceptions exist for individuals who are younger than 65.
To be eligible for Medicare coverage, people under age 65 need to meet certain requirements. They must already be receiving Railroad Retirement or disability benefits from the Social Security Administration; they must have end-stage renal disease (ESRD), which is permanent kidney failure; or they must have amyotrophic lateral sclerosis (ALS), which is also called Lou Gehrig’s disease.
If you’re eligible for Social Security Disability Insurance (SSDI) and are under age 64, you become eligible to receive Medicare benefits after a 24-month waiting period that starts on the date you became disabled (your onset date). This is different from the date that you started receiving SSDI benefit payments, which may be five or more months after your onset date. If you have ESRD or ALS, you may be eligible to begin receiving Medicare immediately, without the 24-month waiting period.
Medicare Parts Explained
Medicare has four parts, with each one covering different types of medical services and offering different benefits. If you opt for original Medicare, you can get supplemental coverage to help with your deductibles and other out-of-pocket expenses. Original Medicare has four separate parts.
Sometimes called “hospital insurance,” Medicare Part A covers inpatient care in hospitals and skilled nursing facilities as well as hospice and home health care. Medicare Part B, which is sometimes called “medical insurance,” covers the services you receive from doctors and health care providers, including outpatient care, home health care, durable medical equipment and preventive services like wellness visits. Medicare Part D provides prescription drug coverage and helps lower your costs for prescription medications.
Medicare Part C works a little differently. Also known as the Medicare Advantage network, Medicare Part C offers plans that are available through private companies that bundle Parts A, B and D into one part, giving you an alternative to the three-part original Medicare. These plans also often offer extra benefits and lower out-of-pocket costs. However, they typically require you to visit healthcare practitioners and facilities that are in a specific network, instead of any doctor or hospital that accepts Medicare.
Costs for Medicare
Similar to many traditional health insurance policies, Medicare involves premiums, deductibles and coinsurance. The amounts of each change each year, and the different parts also involve different costs. Most people don’t pay premiums for Part A unless they didn’t pay Medicare-related taxes during enough quarters of their lifetimes. Part A does involve deductibles and coinsurance, however.
Part B has standard deductibles and premiums that you must pay every year and month, respectively. Part C and Part D premiums vary depending on the particular plan you’ve chosen. Once you meet your annual deductible, you’ll typically still need to pay 20% of the Medicare-approved cost for many physician services, therapies and medical equipment.
Knowing where to turn if you have questions and concerns or need more information can make signing up for Medicare an easier process. You can access a combination of general information and personalized details by visiting the official Medicare help site, or you can call the main Medicare phone number, 1-800-MEDICARE (1-800-633-4227), to get more detailed answers to your questions.
The Enrollment Process
What you’ll need to do to get enrolled in Medicare depends on when and why you’re receiving it. If you’ve already retired or are receiving Social Security benefits at age 65, you’ll automatically be enrolled in Part A and Part B when you turn 65. You’ll be eligible to receive Part D, but you’ll need to choose a plan yourself. You won’t automatically get enrolled in Part D like you will with Part A and Part B. If you’re receiving SSDI payments, you’ll automatically enroll in Medicare once the 24-month waiting period has elapsed.
In some cases, you won’t automatically be enrolled in Medicare when you turn 65, and you may have to apply for it yourself online, over the phone or at your local Social Security office. If you aren’t eligible to receive Social Security retirement benefits because you didn’t work long enough or pay Social Security taxes for the required length of time, you can still enroll in Medicare. Keep in mind that your premiums will be higher because of this.
In this case, you’ll need to sign up for Medicare during your Initial Enrollment Period, which begins seven months before your 65th birthday and ends three months after that birthday. If you don’t enroll during this time, you can enroll during Medicare’s General Enrollment Period, which lasts from January 1 to March 31 each year — but you may pay a penalty for waiting.