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The Basics of Medicare for New and Ongoing Enrollment

September 22nd is the last day of summer, with fall quickly approaching. School is back in session (virtually, as my 3 kids log-in from home), Monday night football is back (no fans in the stands), and open enrollment for Medicare starts October 15th. The good news is that you can review your choices and enroll for Medicare online! Check out the links at the end of this blog.

Medicare and Social Security

If you’re over 65 (or turning 65 in the next 3 months) and not already getting benefits from Social Security, you’ll need to sign up to get Medicare part A and B. You won’t get Medicare automatically.

If you’re already getting benefits from Social Security, you’ll get Medicare Part A and Part B automatically when you’re first eligible and don’t need to sign up. Medicare will send you a “Welcome to Medicare” packet 3 months before you turn 65. You’ll still have other important deadlines and actions to take, so read all of the materials in the packet.

If you already have Medicare, open enrollment begins in less than a month. The Medicare open enrollment period is an annual period of time (October 15 through December 7) when current Medicare users can choose to re-evaluate part of their coverage (Medicare Advantage/Part C and/or Part D plan) and compare it against all the other plans on the market.

When you first become eligible for Medicare during your Initial Enrollment Period (the 7-month period that begins 3 months before the month you turn 65, includes the month you turn 65, and ends 3 months after the month you turn 65), you can join a Medicare Advantage Plan (with or without drug coverage) or Medicare drug plan. 

There are specific times when you can sign up for a Medicare Advantage Plan (with or without drug coverage) or a Medicare drug plan or make changes to coverage you already have.

  • General Enrollment Period. If you have Part A coverage and you get Part B for the first time during this period, you can also join a Medicare Advantage Plan or Medicare drug plan. Your coverage may not start until July 1.
  • Open Enrollment Period. From October 15 – December 7 you can join, switch, or drop a Medicare Advantage Plan or Medicare drug plan. Your coverage will begin on January 1 (as long as the plan gets your request by December 7).

The Four Main Components of Medicare

There are four different kinds of Medicare programs available to individuals. Basic Medicare coverage comes predominately via Parts A and B—also called Original Medicare—or through the Medicare Part C plan. Individuals may also opt to enroll in the Medicare Part D plan.

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 some home-based health care. This plan, though, doesn’t cover long-term or custodial care.Coverage is automatic for anyone who receives Social Security benefits.

Medicare Part B 

Medicare Part B generally covers costs for things like outpatient care such as doctor visits. Part B also covers preventive services, ambulance services, certain medical equipment, and mental health coverage. Some prescription drugs also qualify under this plan. The standard monthly premium for this plan for 2020 is $144.60, while the deductible is $198. Premiums are higher for anyone whose annual income is more than $87,000 ($174,000 for married couples).

Medicare Part C 

These plans, also known as Medicare Advantage, must offer coverage that is at least equivalent to Original Medicare (Plans A and B). Consumers purchase Medicare Advantage plans through private insurers rather than through the government itself. Many of these plans offer annual limits on out-of-pocket costs. Many also provide benefits that Original Medicare patients would otherwise need to purchase via supplemental insurance such as a Medigap plan, and may include copays, coinsurance, deductibles, and even costs related to insurance while traveling outside the U.S. Some plans may also include dental, vision, and hearing care.

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.

The CARES Act of 2020 

On March 27, 2020, President Trump signed a $2 trillion coronavirus emergency stimulus package called the CARES (Coronavirus Aid, Relief, and Economic Security) Act, into law. It expands Medicare’s ability to cover treatment and services for those affected by COVID-19. The CARES Act also:

  • Increases flexibility for Medicare to cover telehealth services.
  • Authorizes Medicare certification for home health services by physician assistants, nurse practitioners, and certified nurse specialists.
  • Increases Medicare payments for COVID-19-related hospital stays and durable medical equipment.

If you have further questions on how Medicare and Social Security fit into your financial plan, our team can help. Let’s get together for coffee (virtually with Zoom) and talk. 

Resource links for Medicare:

https://www.medicare.gov/sign-up-change-plans

https://www.ssa.gov/benefits/medicare/

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