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If you’re about to turn 65, it is time to think about Medicare.  There are a number of different options to consider when signing up for Medicare and it is important to understand your Medicare coverage choices and to pick your coverage carefully.  How you choose to get your benefits and who you get them from can affect your out-of-pocket costs and where you can get your care. 

To begin, let’s start with the basic components of Medicare.  Medicare consists of four major parts: Part A and Part B (also known as Original Medicare), Part C and Part D. 

▪ Part A provides your inpatient hospital coverage. 

▪ Part B provides your outpatient medical coverage. 

▪ Part C offers an alternate way to receive your Medicare benefits. 

▪ Part D provides prescription drug coverage. 

In addition, Medigap policies offer additional coverage to individuals enrolled in Parts A and B.  We will cover more about this below. 

Medicare Eligibility

Eligibility does depend on a certain criteria.  To qualify for Medicare coverage, you must have lived in the U.S. for at least five years and are 65 or older.  You may also qualify for Medicare coverage if you have been on Social Security Disability for a period of 24 months. 

Initial Enrollment Period 

You will need to enroll 1 to 3 months prior to your 65th birth month for coverage to begin on the first day of your birth month.  If you join 1 to 3 months after your birth month, coverage will begin on the first day of the month following enrollment. 

• Enrollment is automatic in both Parts A and B for anyone who is currently collecting Social Security benefits.  So basically, if you’re turning 65 and collecting Social Security, you shouldn’t have to do anything except to look for your red, white, and blue Medicare card in the mail. This card will be sent directly to you from The U.S. Social Security Administration. 

• If you are currently not receiving Social Security benefits, then you will need to sign up for Medicare by visiting your local Social Security Administration office, calling the Social Security Administration at 800-772-1213, or online at http://www.socialsecurity.gov/medicareonly/.  You can also visit Medicare’s website where they can help guide you through the process of enrolling by going to www.medicare.gov. Ideally, you will want to do this as soon as possible so your coverage begins on the first of the month you turn 65.  Your initial enrollment period begins 3 months prior to your 65th birthday unless your birthday falls on the 1st of the month.  If this is the case, your coverage will start on the 1st of the month prior to your 65th birthday.  For instance, let’s say your birthday is June 1st; your coverage will begin on May 1st.  

There are some exceptions to signing up for Part B.  It is possible you may not need to sign up for Medicare Part B right away if you still plan on working past age 65 and have creditable coverage.  Creditable coverage is health insurance provided through your employer where you are currently working. It is important that you find out from your employer whether the employer's plan will be the primary insurer.  If Medicare is the primary insurer, then you will need to sign up for Part B.  For those who are not going to sign up for Part B, you should still enroll in Medicare Part A, which could help pay for some costs that are not covered by your group health plan.  There may be some exceptions if your employer plan is a Health Savings Account (HSA).  

**Please note that COBRA coverage does not count as a creditable coverage health insurance plan for Medicare purposes.  This also goes for retiree coverage and VA benefits. So, just because you have some type of health insurance, doesn't mean you shouldn’t sign up for Medicare Part B if you want to avoid a further penalty if you do decide to enroll later.

Now, let’s talk about those who do not fall under the category of having creditable coverage, meaning that you currently do not have health insurance, do not have health insurance through your current employer, will lose your employer offered health insurance when you turn 65, or that your employers’ plan is secondary to Medicare.  You will want to sign up for Medicare Part B during your initial enrollment period.  This is very important! If you do not sign up for Part B right away, then you will be subject to a penalty.  Meaning, your Medicare Part B premium could go up 10 percent for each 12-month period that you did not have Medicare Part B, but could have taken it.  If this happens, you will have to wait until the general enrollment period to enroll.  The general enrollment period typically runs between January 1 - March 31 of each year and coverage starts July 1st of that year. 

Have questions?  Or if you would like more information on Medicare and how it may work with your current insurance provided through your employer give our office a call (910) 509-7255, or fill out a contact form by clicking the button at the bottom of this article. 

Types of Medicare Coverage 

As mentioned in the beginning, there are four different parts to Medicare. Your basic Medicare coverage comes predominantly through Parts A and B, also known as Original Medicare—or if you have a Medicare Advantage Plan, this would be through Part C. Individuals may also opt to enroll in the Medicare Part D (Prescription Drug plans). 

Medicare Part A

Medicare Part A covers costs billed by hospitals or similar inpatient or inpatient-like settings, such as skilled nursing facilities, as well as hospice, and covers some home-based health care.  However, this part of Medicare does not cover long-term or custodial care. Deductibles and Coinsurance for Part A for 2024 are set as follows: 

• Inpatient hospital deductible: $1,632

• Daily coinsurance for the 61st to 90th day: $408

• Daily coinsurance for lifetime reserve days: $816

• Skilled nursing facility coinsurance for days 21 through 100: $204 

Medicare Part B 

Medicare Part B generally covers costs for things like outpatient care such as doctor visits. Part B also covers preventive services, certain medical equipment, and some mental health coverage.  With this said, the standard monthly premium for this plan for 2024 is $174.70, while the deductible is $240.  Please note that premiums are higher for anyone whose annual income is more than $103,000 — $206,000 for married couples.  You may be responsible for paying the $240 annual deductible and generally 20% of the cost for Part B services thereafter.

Medicare Part C

These plans, also known as Medicare Advantage, are plans that can be purchased through private insurers that contract with Medicare to provide you with all your Part A and B benefits. Some of these plans offer annual limits on out-of-pocket costs and may cover routine vision or dental care.  Medicare Advantage Plans typically have network restrictions. Due to the fact that not all doctors or hospitals that accept Original Medicare accept Medicare Advantage Plans.  So you may be more limited in your choice of doctors and hospitals. Most Medicare Advantage Plans offer prescription drug coverage through the plan itself. 

Medicare Part D 

Medicare offers supplemental prescription drug coverage through Medicare Part D.  Enrollees in Medicare Part A or Part B may enroll in Part D to receive subsidies for prescription drug costs that Original Medicare plans do not cover.  Part D coverage is optional and enrollment must be done up to 3 months before your 65th birthday if you want your coverage to start on the 1st of the month you turn 65.  You can enroll up to 3 months following your 65th birthday with the exception of your birthdate being on the 1st of the month. 

Medigap (Supplemental) Policies

Medigap policies are sold by private insurance companies to fill the “gaps” in original Medicare (Part A and B).  They must follow federal and state laws and are regulated by the government.  These plans are not the same as a Medicare Advantage Plan.  (To qualify for a Medicare Supplement policy, you must be enrolled in Part A or B).  The plans range as followed: A, B, D, G, K, L, M and N.  (Plans F and C may be offered to Medicare recipients who were eligible prior to January 1st, 2020).  You may switch your plan anytime you wish.  These plans can be used with any doctor or hospital that takes Medicare (and most do) anywhere in the U.S. and U.S. territories.  These plans do not offer prescription drug coverage, so in most cases, if you want outpatient prescription drug coverage, you will need to enroll in a stand-alone Medicare prescription drug plan (PDP). 

In Conclusion

Finding the right advisor that fits your needs doesn’t have to be hard.  We are legally bound to act in your best interests and being that we are independent agents means we are not obligated to sell for just one company.  Our goal is to find you the least expensive plan with an A-Rated company.  For more information, please give our office a call at (910) 509-7255 or call us toll-free by dialing (855) 469-7384. 

 *DISCLAIMER: We do not offer every plan available in your area. Currently we represent 5 organizations which offer 30 products in your area. Please contact Medicare. gov, 1-800-MEDICARE or your local State Health Insurance Program (SHIP) to get information on all of your options.