Medicare Basics
What's Medicare?
Medicare is a federal program that offers health insurance to American citizens and other eligible individuals based on age, disability or a qualifying medical condition. Medicare is individual insurance and doesn't cover spouses or dependents.
Who can get Medicare?
U.S. citizens and legal residents
Legal residents must live in the U.S. for at least 5 years in a row, including the 5 years just before applying for Medicare.
You must also meet one of the following requirements:
- Age 65 or older
- Younger than 65 with a qualifying disability
- Any age with a diagnosis of end-stage renal disease or ALS
Eligible with a disability?
Your Medicare eligibility begins after 24 months of receiving Social Security disability benefits.
Medicare is not Medicaid
Medicaid is a program that helps pay health care cost for people with limited income and resources. Both Medicare and Medicaid are government programs. Both programs help people pay for health care. But that's where the similarities end. Medicare is generally for people who are older or disabled. Medicaid is for people with limited income and resources. Medicare is governed by the federal government. Medicaidid programs are governed by the states.
How do you enroll?
If you are receiving Social Security or Railroad Retirement Board benefits when you become eligible you will be automatically enrolled in Medicare Parts A and B. You'll receive your Medicare card in the mail.
If you're not receiving benefits, you need to sign up for Medicare when you become eligible. Go to ssa.gov to enroll online, or call or visit your local Social Security Office.
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Are you turning 65?
You are eligible for Medicare at age 65
You have a 7-month Initial Enrollment Period (IEP) for Medicare. It includes the month you turn 65, the 3 months before and the 3 months after. It begins and ends a month earlier if your birthday is the first day of the month.
Sign up early
Coverage begins the first day of your 65th birthday month if your enrollment is completed during the first 3 months of your IEP. It begins the month before if your birthday is on the first. Your coverage start date may be delayed if you sign up later.
You have choices
You many enroll in Medicare Part A, Part B or both. You may also add additional coverage such as a Medicare Advantage, Part D or Medigap plan.
Are you working past 65?
You still have an Initial Enrollment Period
Even if you have coverage through an employer plan (your or your working spouse's, you have Medicare decisions to make at age 65. Your IEP happens when you turn 65 whether you continue to work or not. Depending on the employer coverage you have, you may be able to delay enrolling in Medicare without penalty.
Talk with your employer's benefits administrator to understand your options and to determine if your coverage is considered "creditable."
You may be able to delay if:
- The employer has 20 or more employees
- The employer-provided health insurance is considered "creditable"
- The employer doesn't require covered spouses to enroll in Medicare at age 65 in order to remain on the employer's plan
Pay attention to details
You must stop contributing to a health savings account (HSA) once you enroll in Part A or Part B. Also, get a notice of "creditable drug coverage" from your plan administrator. You must have this documentation to avoid the Part D penalty if you plan to delay enrollment.
Medicare Coverage Options
Original Medicare (Part A & B) is provided by the federal government. It helps pay for hospital stays and doctor visits, but it doesn't cover everything. You may add coverage by enrolling in one or more private Medicare or Medicare-related plans.
Step one
Part B
Heps pay for doctor visits, outpatient care, medical supplies, and preventive services.
Step Two
Now, you can look at additional coverage options
Offered by private insurance companies.
Option 1
Medicare Part D Plan
Medicare Supplement Insurance (Medigap)
Medicare Supplement Insurance (Medigap)
Helps pay for prescription drugs
Medicare Supplement Insurance (Medigap)
Medicare Supplement Insurance (Medigap)
Medicare Supplement Insurance (Medigap)
Helps pay some out-of-pocket costs not paid by Original Medicare.
Option 2
Medicare Advantage Plan
Combines Original Medicare Part A & Part B coverage into one plan.
Usually includes prescription drug coverage (Part D)
May offer additional benefits like vision and dental coverage
.
Medicare isn't one-size-fits-all
You can combine different Medicare parts and plans to get the coverage that best fits your health and lifestyle needs.
Your combination options depend on whether you get Medicare Part A and Part B coverage through Original Medicare or through a Medicare Advantage (Part C) plan instead.
