New to Medicare

New to Medicare

Introduction
Medicare is a prominent health insurance coverage program for people who are 65 or older. Individuals with qualifying disabilities, end-stage renal disease (ERSD), or forms of sclerosis such as Lou Gehrig’s disease may also qualify for the program. The federal government administers Medicare through the Centers for Medicare and Medicaid Services (CMS). According to CMS, over 67 million Americans are enrolled in the program. Medicare consists of four parts: A, B, C, and D. Part A and Part B are the primary categories otherwise known as Original Medicare. In addition to these two common primary categories, there is also an alternative category known as Part C. Many insurers refer to Part C as Medicare Advantage. The final category is Part D and is also known as the Medicare Prescription Drug Plan (PDP). Whether you have an eligible health condition or simply want to explore your options before you turn 65, an overview of the program can provide guidance for anyone who is new to Medicare.

What Does Medicare Coverage Include?
The four categories of Medicare describe different types of health insurance coverage. Medicare Part A is hospital insurance. This insurance covers inpatient hospital stays, skilled nursing, hospice admission, and qualifying home healthcare. Medicare Part B is medical insurance. It provides coverage for outpatient care, emergency services, and doctors’ or provider office visits. This insurance also covers medical supplies and durable medical equipment (DME) ranging from canes to walkers and wheelchairs. It may also cover preventative care like screenings as well as many professionally administered prescription drugs.

Part C or Medicare Advantage is a Medicare-approved plan offered through private insurance companies. It covers everything included in Part A and Part B, but it may also include added benefits like dental, hearing, and vision coverage. You may need to pay an additional premium to the private insurer who provides your Part C plan. Part D or the Prescription Drug Plan (PDP) is a program offered through Medicare-approved private insurance companies. The plan covers self-administered prescription drugs. While Part C or Medicare Advantage is the alternative to Original Medicare, Part D or the Prescription Drug Plan is usually a supplement to your main coverage.

Who Qualifies for Medicare?
Individuals are eligible for Medicare for different reasons. Most people become eligible for Medicare when they turn 65. However, some individuals under 65 can automatically receive Medicare. According to Centers for Medicare and Medicaid Services, people who receive Social Security Disability Insurance (SSDI) or specific Railroad Retirement Board (RRB) disability benefits are eligible after 24 months. During month 25, these individuals receive a packet about their enrollment in Part A and Part B (Original Medicare). People who receive SSDI or RRB can keep or decline Part B. Some individuals waive Part B to avoid paying premiums. However, disability recipients cannot decline Part A without withdrawing from SSDI and paying back any cash benefits. There is no waiting period for people diagnosed with Lou’s Gehrig’s disease (ALS), and people with end-stage renal disease (ESRD) can also receive Medicare.

If you are not receiving Social Security for a disability or retirement, you must wait to sign up for Medicare when you are 65. There are no income limits to receiving Medicare, but your yearly income can impact the amount you pay for premiums. Medicare requires high earners to pay more for premiums even if benefits do not change. For example, individuals with incomes over $103,000 or married couples with household incomes over $206,00 for married couples pay a surcharge on Part B and Part D known as the Income-Related Monthly Adjustment Amount (IRMAA). On the other hand, people with limited or fixed incomes may be eligible for assistance through ExtraHelp programs that cover premiums.

When Do You Sign Up for Medicare?
Americans become eligible for Medicare when they turn 65 regardless of their actual retirement age. There are three enrollment periods known as Medicare Initial Enrollment, Medicare Open Enrollment, and Medicare Special Enrollment. The Medicare Initial Enrollment period is for people signing up for Medicare for the first time. It allows you to sign up three months before your 65th birthday, during your birthday month, or in the three months after your birthday. It is important to sign up during this seven-month window to avoid penalties. The good news is that coverage is retroactive for six months. This means Medicare coverage can apply to healthcare costs incurred for half a year prior to your signup date.

Medicare open enrollment is for people who are not signing up for the first time. It is also called the annual election period and takes place each fall. During open enrollment, existing beneficiaries can adjust Medicare coverage or switch to a Medicare Advantage plan. A secondary open enrollment period is called the Medicare Advantage open enrollment and takes January 1-March 31. It is for people who are enrolled in Medicare Advantage but want to switch insurers or go back to Original Medicare.

Medicare general enrollment is for people who missed the initial enrollment period but do not qualify for special enrollment. It takes place January 1-March 31. Coverage begins the month after you sign up, and you may face penalties. Finally, Medicare special enrollment is for people facing certain life events like losing coverage from an employer or living in a disaster area. Special enrollment gives you six months to sign up, and you can face late enrollment penalties for failure to sign up during this time.

Conclusion
Medicare helps ensure healthcare access for people seniors or people with disabilities. Because the system is complex, most people seek help choosing the right plan. K&B Financial offers insurance services and free consultations for individuals new to Medicare. Based in Darien, we serve the entire state of Illinois. Work with one of our licensed insurance agents for a personal approach to individual insurance, family plans, or enrollment assistance. Contact K&B Financial today for all Medicare enrollment needs.

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