Most people working as employees do not give their medical insurance too much thought until retirement, they just accept the plans provided by their employers. However, around retirement or when approaching the age of 65, most people are faced with important decisions related to their Medicare coverage – decisions that might feel overwhelming. The Medicare system is notoriously difficult to understand, which means that the best selection of plans and components can only be made after some serious research and after achieving a thorough understanding of the terms used in the related materials. To make the process easier for you, here are some tips from Medicare Advantage Denver experts.
The first thing to understand and a very important aspect is eligibility. Medicare is available for anyone aged 65, including not only citizens, but also people who have been legal residents in the USA for at least 5 years. Younger people can also benefit from Medicare provided that they have qualified for Social Security disability for at least 24 months on end.
What Medicare Includes
The national health insurance program called Original Medicare consists of four parts:
- Part A is the hospital coverage that pays for the first 90 days of treatment in a hospital or in a nursing facility as well as for treatment in a hospice facility. Part A pays some of the costs related to hospital treatment even after the first 90 days, but the amount that the beneficiary will have to pay out of pocket will start increasing;
- Part B is the component that offers coverage for outpatient services, such as visits to the offices of health care providers and the professional administration of certain prescription drugs;
- Part D is coverage for self-administered prescription drugs. The beneficiary receives a pharmacy card that will give the beneficiary discounts on prescription medication;
- Part C, also called Medicare Advantage, is an alternative to the previous three types of coverage available from private health insurance companies. This type of coverage also offers certain additional benefits over Original Medicare Parts A, B and D, such as an upper limit on the out-of-pocket expense to be supported by the patient.
People eligible for Original Medicare Part A, B and D can also extend their coverage opting for a Medicare Supplement enrollment, plans available from private insurers that provide help to cover the amount payable by the beneficiary after having used the Original Medicare coverage.
Understanding the Costs
The people eligible for Medicare usually have to cover certain costs out of their pocket. Part A is usually free for people who have worked for at least 10 years in the US or who have a spouse who has worked for that amount of time. The amount that you will be required to pay for Part B depends on your income. The beneficiaries who have higher income will pay more, the amount being calculated through the income adjustment process.
The costs of Part D are somewhat more difficult to calculate. The premiums related to the component will depend on the beneficiary’s level of income as well as on the type of Part D chosen – currently, there are over twenty different Part D plans available.