10 Things You Need to Know About Medicare

Research Medicare for your elderly parents so you can make a fully informed decision about their future care. As you navigate Medicare, keep the following 10 points in mind to help maximize Medicare coverage while minimizing stress and expenses for you and your loved one.

Most people initially become eligible for Medicare three months before turning 65. A person may also be eligible earlier if they have a disability, End-Stage Renal Disease (ESRD), or ALS, also known as Lou Gehrig’s disease.

Before becoming eligible for Medicare, your loved one may already be insured with another form of insurance, such as retiree health insurance, individual health insurance, or COBRA insurance. Regardless, Medicare will automatically become their primary insurer once they turn 65. After their 65th birthday, any other forms of insurance will be considered a secondary insurer. This is true even if they haven’t applied for Medicare yet.

This consideration is an important factor to know and understand. It means once their 65th birthday passes, your loved one can’t count on their other forms of insurance to pay for their hospital or physician bills.

Medicare is divided into four separate parts. Each part helps pay for different health care costs.

• Part A refers to hospital insurance and covers most care related to inpatient hospital, skilled nursing facility, home health, hospice care, or palliative care.
• Part B refers to medical insurance and covers most outpatient care, durable medical equipment, and medically necessary doctors’ services. It can also cover preventive care like laboratory tests, X-rays, mental health care, and some home health and ambulance services. You pay a monthly premium for this coverage.
• Part C refers to Medicare Advantage Plans. With these plans, private health insurance companies have contracts with the government. Medicare Advantage Plans may provide all of hospital and medical insurance coverage (Parts A and B), or they may offer extra coverage on things like vision, hearing, and dental. These plans are not provided directly by the government like Medicare is. You’ll learn more about Medicare Advantage Plans in the next section.
• Part D offers different plan options that cover different prescription medications. If choosing a Part D plan, make note of which prescriptions you or your loved ones will need in the near future. Part D is never provided directly by the government and is a separate, optional plan to help cover the cost of medication.

You can choose either Original Medicare (Parts A and B) or a Medicare Advantage Plan (Part C). You can also opt for the other parts as mentioned above, like adding prescription drug insurance (Part D).

The type of Medicare a person selects will depend on their unique circumstances — there’s no right or wrong answer. Consider the following when choosing between Original Medicare and a Medicare Advantage Plan for your loved one.

What you get with Original Medicare:

• Your loved one can usually choose to see any doctor. However, you should check with your loved one’s preferred doctor first, as some doctors choose not to participate in the original Medicare program. This is a critical step if it’s important to remain with a family doctor.
• There may be more out-of-pocket costs compared to those with the Medicare Advantage Plan.
• Your loved one will have a choice of the drug plans available in their area.

What you get with a Medicare Advantage Plan:

• There are limits to the doctors your loved one can visit. If remaining with the family doctor is important to you and your loved one, you should check to ensure your doctor is covered under this plan.
• There may be fewer out-of-pocket expenses.
• Your loved one may have access to extra hearing and vision benefits.
• Drug coverage is included in some, but not all, types of Medicare Advantage Plans.
• Historically, Medicare has reimbursed only for skilled nursing services, such as giving injections, medical treatments and more. However, the Centers for Medicare and Medicaid Services (CMS) recently announced that non-skilled home care services will be covered as of 2019, as a
  supplemental benefit for Medicare Advantage plans.

It’s preferred to apply for Medicare as soon as your loved one is eligible. You must apply during the initial enrollment period, which starts three months before their 65th birthday and ends four months after their 65th birthday. This allows a seven-month window to apply.

Because applying for Medicare is a lengthy process, you and your loved one should start researching when they turn 64. Applying before turning 65 helps avoid late penalties or having to go temporarily without coverage.

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For anyone who’s just turned 65 who is already receiving Social Security benefits, the Social Security Administration will automatically sign them up for Medicare Parts A and B. They’ll send you or your loved one sign-up instructions at the beginning of the initial enrollment period.

Even if you think your loved one will be automatically enrolled in Medicare, you should still double check well in advance of the initial enrollment period.

If you or your loved one miss the initial enrollment period, they may be charged a late enrollment penalty. Depending on the part of Medicare your elderly parent applies for, these penalties can vary.

In the Part A late enrollment penalty, your monthly premium may go up 10% for twice the number of years you go without coverage. For example, if you don’t sign up for Part A for two years, you’d have to pay the higher premium for four years.

You could be charged a Part B late enrollment penalty for every 12 months enrollment is delayed. This penalty is 10% of the standard Part B premium. For example, if your monthly premium is initially $170.10, the penalty for enrolling late would be an additional $17.10 added to your monthly premium.

You may also face a Part D late enrollment penalty. For every month you were without creditable coverage, you’ll be charged 1% of the standard Part D premium. The monthly penalty is rounded to the nearest $0.10. So, for example, if your initial premium is $33.37, and you go without coverage for 29 months, you’d pay an additional $9.70 on your premium every month.

Keep in mind that these penalties don’t go away. They’ll follow your loved one through life, and the amounts change every year.

Anyone who is eligible can sign up for Medicare during the general enrollment period from January 1 through March 31. People who sign up during the general enrollment period will be eligible for coverage the following July. The Annual Election Period (AEP) runs from October 15 to December 7 every year. During this time, you’re free to switch to a different Medicare plan that may better suit your loved one’s needs.

There are no family Medicare plans. Medicare is an individual benefit — each member of your family needs to apply for Medicare separately.

If a government official gives you incorrect information that causes your loved one to miss the initial enrollment period, then you may not have to pay the entire penalty. However, you have to be able to prove that the government official gave you incorrect information.

Remember to write down important details about conversations with government officials, including:

• Who you or your loved one spoke to
• The date and time of the conversation
• A summary of what the official said
• Their contact information
• Any other pertinent information

You should do this every time you speak with someone in the government about Medicare. For easy access, keep this information in one place, such as a notebook dedicated to Medicare notes.

If you or your loved one can afford it, it is possible to supplement Medicare with a Medicare Supplement Plan called a Medigap policy. These plans will help cover expenses like:

• Coinsurance, the portion of the money you pay after your insurance has paid your benefit
• Copayments, the money you pay each time you seek care
• Deductibles, the money you pay before your insurance benefits kick in

Many seniors have retired by the age of 65 and rush to apply for Medicare. If your loved one plans to continue working or has employer health coverage through a spouse, there may be other options.

Talk with a Senior Living Advisor

• If their employer has 20 or more employees, your loved one can choose to either double up with both employer coverage and Medicare or drop their employer coverage for Medicare.
• If their employer has fewer than 20 employees, your loved one will need to enroll in Medicare during their initial enrollment period.
• If they have health coverage through a spouse’s employer, your loved one may be able to delay enrollment, or they may still need to enroll at age 65. This will depend on the employer’s terms.

Under special circumstances, your loved one may also be able to delay Medicare enrollment and enroll later during the Special Enrollment Period (SEP).

Whether or not a senior plans on continuing to work, Medicare plays a crucial role in health coverage for everyone 65 or older. Understanding ahead of time what you need to know about Medicare plans will help you make an informed decision about your loved one’s health care coverage and overall well-being.

For additional information about Medicare, you can contact:

• Medicare at 1-800-MEDICARE (1-800-633-4227) or access their website
• The “Medicare & You” handbook
• The Medicare Plan Finder
• The Medicare Rights Center hotline at 1-800-333-4114
• Your local State Health Insurance Assistance Program (SHIP)

If you’re thinking about advancing your loved one’s level of care, consider reaching out to a Senior Living Advisor at A Place for Mom to find the right care option to suit your needs. This service is free and has helped families find suitable local care for decades.

Sources:

COBRA Insurance. (2022, April 5). What is COBRA insurance?

Digital Communications Division (DCD). (2021, October 20). What is Medicare Part C? U.S. Department of Health and Human Services (HHS).

Medicare. The official U.S. government site for Medicare.

State Health Insurance Assistance Program (SHIP). Navigating Medicare.

United Medicare Advisors. Health coverage designed for your needs and budget.

United Medicare Advisors. Medicare Advantage: A convenient alternative to Original Medicare.

United Medicare Advisors. Medicare Supplement: Filling the gaps left by original Medicare.

United Medicare Advisors. What to do if you missed Medicare’s open enrollment.

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