Understanding Your Medicare Choices
Parts A, B, C and D
When it comes to choosing Medicare a policy that is best for you, it is so important to research your options. There are a lot of choices available – use this guide to help you.
(Click on any section title or arrow below to reveal Understanding Medicare Choices in detail – click on the arrow to close)
(1) Important Questions About You
- Are you healthy or do you have chronic conditions?
- How much do you spend on your prescription drugs and how often do you take them?
- Who are your doctors? How do you feel about seeing new doctors?
- Besides Medicare, are you eligible for any other health care coverage? If yes, will you keep that coverage when you retire?
- How does health care impact your budget?
- Will you need financial help to pay for your Medicare premiums?
- How much did your health care cost in the last year?
- Do you expect similar costs this year?
- Do you like to travel – how often and where?
(Tip : it is a good idea to write these points down – they will help with understanding Medicare choices and serve to formulate the best plan for you)
(2) Find A Plan That Is Right For You
You have choices that work best for you –
- Do you only want Original Medicare (Parts A and B)? – with a Part D stand-alone prescription drug plan?
- Would you rather have a Medicare Advantage plan (Part C) – like an HMO or PPO?
- If you prefer the Medicare Advantage plan, should it include prescription drug coverage?
Remember : It is in your best interest to consider enrolling as soon as you become eligible – this could save you higher monthly premium costs.
If you have a lower income and are eligible, there is financial help to pay for your Medicare.
(3) Eight Things You Should Know...
- There are two ways to get Medicare;
- Original Medicare (Parts A and B) provided by the government.
- Medicare Advantage plans (Part C) offered by private insurance companies.
- Original Medicare does not pay for everything
- Even though you have contributed to the costs of your Medicare by paying taxes, you will still have to pay a share of monthly premium costs and copays.
- Medicare Supplement Insurance can help you cover out-of-pocket expenses.
- This will will help you cover costs like deductibles and copays that are not covered by Part A and Part B.
- As a Medicare member, you are entitled to get optional prescription drug coverage (Part D).
- You can enroll in a stand alone Part D plan with your Original Medicare.
- Or, you can enroll in a Medicare Advantage plan that includes prescription drug coverage.
- The state you reside in may offer different choices.
- Parts A and B (Original Medicare) is the same across the United States.
- Medicare Advantage (Part C) and prescription drugs (Part D) may be available only in certain counties, states or regions as they are offered by private insurance companies.
- Medicare supplement policies are available by state and offer nationwide coverage.
- Be sure to enroll at the right time.
- The Initial Enrollment Period (IEP) is your first chance to enroll in Medicare – this is three months before your 65th birthday month, the month of your birthday, and the three months after your birthday month.
- Coverage starts on the first day of your birthday month if you enroll before the month you turn 65,
- If you enroll during your birthday month or later, coverage starts on the first day of the following month.
- Review your plan once a year.
- You can change your plan each year during the Medicare Open Enrollment Period (OEP).
- OEP runs from October 15 to December 7.
- Special Election Period.
- In certain cases you may be able to enroll or switch plans outside the IEP and OEP, for example, you retire and leave an employer or union health care plan; you move out of the service area of your current plan.
Understanding Medicare Choices at a glance
Step 1
When eligible, enroll in Original Medicare.
Part A – Covers hospital stays
Part B – Covers doctor and outpatient visits
(If you need more coverage, you can choose Step 2 option 1 OR option 2)
Step 2 (Option 1)
Keep Original Medicare (Step 1) and add:
Medicare Supplement Insurance (covers all or some costs not covered by Original Medicare)
and/or
Part D – covers prescription drugs (offered by private companies)
Step 2 (Option 2)
Enroll in Medicare Advantage (Part C)
Combines Parts A and B
Most plans cover prescription drugs
Additional benefits (usually at extra cost)
Understanding Part A - Hospital coverage
Part A covers hospital stays and skilled nursing after a hospital stay. It also assists with some home-bound skilled care and hospice care.
- You can choose any qualified provider in the USA who accepts new Medicare patients.
- Some coverage limits apply – if you are hospitalized or are in a skilled nursing facility for more than 90 days, you may have to pay for part of the costs.
- Doctor services in the hospital are not covered under Part A.
- You will not pay a premium for Part A if you or your spouse have contributed to Social Security for at least 10 years.
- Your share of the costs will include:
- deductible – that is determined each year, for example, in 2015 the deductible was $1,260 for each hospital stay.
- copay – after staying a certain number of days you are liable for copays. These increase for extended stays.
- coinsurance – applies to inpatient respite care for hospice patients.
Consider adding Medicare Supplement Insurance to cover Part A and B out-of-pocket expenses – see Medigap.
Understanding medicare choices will be much easier with a LifeSmart expert to assist you.
Understanding Part C - Medicare Advantage
Medicare Advantage plans (Part C) are run by private insurance companies. These plans combine coverage for certain hospital costs, doctors visits and other medical services – they may also include prescription drug coverage.
- All covered under one plan.
- Dependent on the plan, you can choose a primary care doctor or you can visit a provider who accepts the plan’s terms, conditions and rates.
- Part C plans have appointed service areas and nationwide emergency coverage.
- Coverage limits vary according to different plans.
- Part C plans cover the same services as Part A and B except for hospice care under Part A.
- Your share of the costs:
- Plan premiums vary widely.
- Plan details will tell you if they have deductibles or not. Many do charge copays or coinsurance.
- For prescription drugs, you may be subject to a coverage gap.
Understanding Medicare Choices – by LifeSmart
Understanding Part B - Doctor visits
Part B covers the costs of medically necessary doctor visits and medical services such as outpatient care at hospitals and clinics, laboratory tests, certain diagnostic screenings, and some skilled nursing care
- You can choose any qualified provider in the USA who accepts new Medicare patients.
- Some coverage limits apply – limits on occupational therapy, and limits on screenings are covered only for specific times.
- Vision, dental and hearing is only covered under certain situations under Part B.
- Part B does not cover care outside the USA.
- Your Part B premium is dependent on your yearly income. Most people pay a monthly premium.
- If you receive Social Security, premiums will be automatically deducted from your benefits.
- Your share of costs will include:
- deductible – in 2016, you have to pay a $166 annual deductible before Part B starts paying costs.
- copay – outbound hospital service copays range. For example, in 2015 this was from a few dollars up to $1,260.
- coinsurance – after you have met your deductible, Part B generally covers 80% and you have to pay the remaining 20% coinsurance.
Consider adding Medicare Supplement Insurance to cover Part A and B out-of-pocket expenses – see Medigap.
Understanding medicare choices will be much easier with a LifeSmart expert to assist you.
Understanding Part D - Prescription drugs
Medicare Part D plans help you pay for prescription drugs – these plans are optional. If you don’t sign up when you become eligible, you may be subject to a higher premium later when you do enroll.
- These plans are sold by private companies.
- The government set the guidelines and the plans offer different drug lists and costs.
- The Part D plan details will inform you what pharmacies you can use and limitations which may apply. Check to see if your plan offers a mail order service?
- Coverage limits in terms of cost and drugs offered vary widely dependent on the plan.
- Most plans have a coverage gap (donut hole) where you will have to pay some of the costs.
- Premiums for the following year are announced in October. Premiums may vary even though plans offer the same drug coverage – do get an annual free plan checkup from LifeSmart!
Understanding Medicare Choices – by LifeSmart