For most people turning 65, Medicare offers welcome relief. Pre-existing conditions are no longer an issue, and the vast majority of hospitals and doctors accept it. A very brief description of this program follows. Of course, this is the view from 2009, before any changes (hopefully for the better) that are currently being discussed in Congress.
Start at Age 65:
One of the confusions surrounding the Medicare program is that it is somehow linked to Social Security. It is not. It is a different program. Specifically -
- The start date for social security benefits is variable, depending upon your birth year, the start date for Medicare is fixed at age 65.
- Although most people should wait until their full retirement age (or beyond) before they start taking Social Security benefits, there is only one reason to delay Medicare, i.e. your retirement benefits from your employer includes private health insurance that covers more than Medicare. The reality is that there are not many of those plans left.
“Parts is parts”:
That quote from an old commercial referred to chicken, but it could also apply to Medicare since it also has parts. The different parts of the Medicare program cover different aspects of coverage - hospitalization, doctors, private Advantage plans, and drugs. Specifically -
- Part A - covers stays at facilities (hospitals, clinics, skilled nursing, etc.) You do not pay any additional fee to enroll in or benefit from this program.
- Part B - provides payments to doctors and other service providers such as physical therapists. You must pay an additional monthly fee to be part of this program. In 2009, the fee is $96.40/mo.
- Part C - usually called Medicare Advantage, these are private plans (HMO’s, PPO’s, or PFFS’s) that are subsidized by Medicare and replace the Medicare Part A and Part B programs. These plans vary by state. The coverage rules of these plans are determined by the individual plan operators, not Medicare. To enroll in these plans, you must first sign-up for Medicare. Once you enroll in these plans, you are excluded from Medicare A and B, and it is quite difficult to return.
- Part D - offers coverage for prescription and generic drugs. These are also private plans which vary by state and require a separate fee. They operate separately from the other parts of Medicare.
MediGap (Medicare Supplement) Plans:
Medicare doesn’t cover all medical expenses. For example, there are deductibles for hospital stays and co-pays for doctor visits. To address these shortfalls, many private insurance companies offer MediGap policies that cover the gaps. These plans vary by state. Although Medicare does specify the coverage rules of these plans, labeled “A” through “J”, they do not administer them.
Decisions to Make:
Among these various options, the decisions a person must make include -
- Do I enroll in Medicare Part B? Most people choose this, but it does require the monthly payment of an additional fee.
- If enrolled in Medicare A & B, should I abandon them and enroll in one of the private Advantage programs? Because you usually cannot reverse this decision once made, your coverage is no longer controlled by Medicare, and you can no longer choose your own doctors or hospitals for the less expensive plans, only about 15% of the people make this choice.
- Do I enroll in Medicare Part D? Since you pay a penalty for enrolling after the initial six month grace period, most people do enroll despite the infamous “donut hole” in the coverage.
- Is there any reason to wait until the changes being discussed in Congress occur? The short answer is NO.
To learn more about Medicare, go to the Medicare web site which is well put together and offers a wealth of information.
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