Medicare

When you turn 65, you are eligible for Medicare. If you currently receive Social Security benefits, you will automatically be enrolled. Otherwise, to avoid penalties, you need to sign up as soon as you are eligible. Please note: There are several optional insurance plans that are designed to supplement Medicare coverage.

Medicare Part A is free for most people, but it covers only inpatient hospital expenses. Medicare Part B (doctor and outpatient visits) and Medicare Part D (prescription drug costs) are optional and have separate premiums and deductibles. 

Medicare Advantage plans (also called Medicare Part C) are offered by private Medicare-approved companies as an alternative to traditional Medicare. These plans include the same coverage as Medicare Parts A, B, and D and may cover some dental care, hearing aids, or eye care services for an additional cost. 

When choosing a Medicare option, check with your doctor to determine whether he or she accepts your coverage or is part of your plan’s network. You may also want to check whether your benefits will follow you if you move to or live part time in another state. 

Your choice is not irrevocable. You can change your Medicare health insurance or prescription drug plan options at the end of each year. Your new choice will be effective for the following year. 

To ensure that your benefits are effective as soon as you are eligible, enroll in Medicare three months before you turn 65. If you don’t sign up for Part A and/or Part B when you are first eligible, you can enroll between January 1 and March 31 every year, but you may pay a penalty for late enrollment. Your coverage will begin July 1. 

If you are currently covered by group insurance through your or your spouse’s employer, you may be able to delay enrolling in Medicare. Talk to your (or your spouse’s) employer about how your group plan coordinates with Medicare. 

If you or your spouse continues to work and you elect to remain on employer-provided group insurance, you have eight months after your employment ends to avoid the penalty for late enrollment. Remember that the clock starts ticking when your employment ends, not when your health insurance ends. If you are covered by COBRA, don’t wait until coverage ends to enroll in Medicare Part B. 

A Medicare Supplement Insurance policy, also called Medigap, is optional coverage available from private insurance companies. It helps cover deductibles and copayments. It may also cover health care provided outside the United States. You do not need a Medigap policy if you enroll in Medicare Advantage. 

Medigap policies come in several standardized versions, identified by the letters A through N. Each standardized Medigap policy must offer the same basic benefits, no matter which insurance company sells it. The only difference is cost, so shop around before choosing a carrier. 

Medicare provides very limited coverage for long-term care expenses for chronic illness or disability. A separate long-term care insurance policy may give you more control over your options, help you live independently, and, in some states, allow you to protect your children’s inheritance. 

For more information about your Medicare choices, visit www.medicare.gov. Download the official U.S. government Medicare handbook, Medicare & You. You may also want to read Medicare’s publication, Choosing a Medigap Policy. If you prefer, you can also call 800.MEDICARE (800.633.4227) to obtain more information.