For most people who have been covered for their entire working lives under employer group health coverage, Medicare is the first time where you really have to go off on your own and figure out which available coverage is best for you, so this video is going to be a brief overview of the Medicare program to help you on that path. Confused about your Medicare coverage options?
For any answers to specific questions regarding your unique situation and your location, because the plans do vary depending on where you live, please give our office a call at 877-312-1414. A licensed, experienced broker will be happy to assist you.
Watch our free video: How to Find the Best Medicare Coverage Without Paying More Than You Need To…
So first, what is Medicare?
Medicare is a government program that provides health coverage to people who are age 65 or older and also to people who are under age 65 but have certain disabilities. Original Medicare had two parts, Part A and Part B, and we still refer to those as Original Medicare, as opposed to the new parts: Part C and Part D, which came out in the early 2000s.
Medicare Part A
Medicare Part A is basically your hospital insurance or your inpatient insurance. It doesn’t cover everything at 100%. There are deductibles and co-insurance amounts that remain your responsibility with Medicare Part A.
If you have worked 40 quarters and had your Medicare tax taken out through that time, then you will not have to pay a premium to enroll in Medicare Part A. That’s what those taxes paid for.
Medicare Part B
Medicare Part B is your outpatient insurance. Now this one you do have to pay a premium for when you enroll in Medicare Part B, so timing that enrollment becomes very important.
Medicare Part B, like Medicare Part A, has a deductible that you have to meet before Medicare will start paying anything. Once that deductible is met, Medicare covers approximately 80 percent of covered outpatient costs, leaving 20 percent as your responsibility. There’s no cap on that 20 percent, so there’s no limit to how much you can end up spending on your medical care through a year.
Medicare Part C (Medicare Advantage)
Medicare Part C is also known as Medicare Advantage plans. The way Medicare Advantage plans work is private insurance companies will contract with Medicare, and then they provide plans that will cover your Medicare Part A and Part B coverage, but instead of having that managed by Medicare itself, your medical costs are covered by the independent health insurance company that contracted with Medicare.
Medicare Part D
Most Medicare Advantage plans will also include Part D. Part D is prescription drug coverage. Those plans are known as MAPD plans. There are also some Medicare Advantage plans, known as MA only plans, that do not have the Part D drug coverage included.
Medicare Part D also offers standalone plans for those who are not interested in enrolling in a Medicare Advantage plan with Part D coverage. Like Part C, or Medicare Advantage plans, Medicare Part D plans are offered through private insurance companies that contract with Medicare. All of those plans have to be approved by Medicare before they are allowed to offer them to the public.
Supplemental Medicare Coverage
As mentioned earlier, Original Medicare Parts A and B do not cover all of your costs, so most people decide either to enroll in a Medicare Advantage plan, either MA or MAPD, and have their health care managed by a private insurance company, or they choose to have Original Medicare, Medicare Parts A and B, and then purchase a Medicare Supplement.
Medicare Supplements/Medigap
Medicare Supplements are also known as Medigap plans, and they do just that: they fill in the gaps in coverage in Original Medicare to control your out-of-pocket spending. Now it gets a little bit confusing because we have the Parts of Medicare: A, B, C, D, and then we have the plans for Medicare Supplements, which are also named by letters.
Those are letters A through N in most states, not all (Wisconsin is an exception). Those plans have uniform coverage, so for example, if you want a Plan G, a Plan G sold by any company selling Medicare Supplements in your state will have exactly the same benefits.
However, they do have different premium costs, and this is why it’s important to speak with a licensed broker regarding the options available to you in your particular location.
This is the basic structure of the Medicare program. For answers to questions regarding your specific location, your unique circumstances, please send us a message, give us a call, send an email, or watch our free online video to learn how to find the best Medicare coverage for you. We’re happy to help you.
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