It’s no secret that health insurance can be… confusing. Whether you are enrolling for the first time or considering changing your health insurance plan, you may be wondering whether to enroll in Original Medicare or a Medicare Advantage plan, what type of coverage you have right, if you need to sign up for prescription drug coverage, changes you can make to your current coverage and more.
Start reading to learn more about coverage options and how to make the best choices for yourself or your loved one.
Medicare Open Enrollment Period
When you can enroll in a Medicare plan or make changes to your current plan depends on your situation.
If you’ve never had Medicare before, the open enrollment period begins three months before age 65 and continues for seven months, also known as the initial enrollment period. So if you turn 65 in November, for example, you can enroll from August to March. However, if you don’t register within this window and wish to register later, you will be charged a penalty, so plan ahead.
These rules determine when you are actually covered by Medicare:
- If you enroll before you turn 65, coverage begins the month you turn 65.
- If you enroll in the fourth month of your initial enrollment period, coverage begins the following month.
- If you enroll during the fifth month of the enrollment period, coverage begins the second month after enrollment.
- If you enroll during the sixth month of the enrollment period, coverage begins the third month after enrollment.
For those who are already registered, open registration for next year, also known as the annual election period, is October 15 through December 7. This is when you can make changes to your plan or sign up for another plan. These changes take place on January 1 of the following year. Changes you can make during the annual election period include:
- Transition from Medicare Original to Medicare Advantage
- Switching from Medicare Advantage to Original Medicare
- Switching from one Medicare Advantage plan to another
- Switching from one Medicare Part D plan to another
- Medicare Part D Enrollment
There are a few other circumstances that follow different enrollment periods: Special enrollment periods are available for those who have certain life changes, such as loss of insurance coverage, relocation, eligibility for assistance financial, etc. See the rules for these circumstances on Medicare.gov.
The general Medicare enrollment period runs from January 1 through March 15. This is for those who did not enroll in Medicare Part A or Medicare Part B when first eligible and do not have access to a special enrollment period. Coverage for those who enroll during this period begins July 1.
Who is eligible for Medicare?
Registration for health insurance is not compulsory. Many people who are still working and qualify for Medicare coverage choose not to enroll or delay enrollment. The following categories of people are eligible for Medicare:
- U.S. residents age 65 and older, who are either U.S. citizens or lawful aliens residing in the United States for five or more consecutive years prior to applying for Medicare
- Individuals eligible to receive U.S. Social Security retirement benefits, railroad retirement benefits, or Social Security disability insurance
- People with end-stage renal disease or Lou Gehrig’s disease who experience certain requirements
- People who received US Social Security disability benefits for 24 months
If you still have questions about Medicare eligibility, enter your information in the Medicare.gov Eligibility and Monthly Premium Calculator.
Types of health insurance plans and coverage
The two main types of Medicare plans are Original Medicare and Medicare Advantage. With Original Medicare, the government directly pays for the health care services you receive. Here are some facts to know about original health insurance plans:
- They include Medicare Part A (which is hospital insurance for inpatient care, skilled nursing, and some home health care and palliative care) and Medicare Part B (which pays for physician and provider services, outpatient care, home health care, durable medical equipment and some preventive services).
- They allow you to see a specialist without prior authorization.
- They require you to pay certain premiums, deductibles and coinsurance.
- They allow you to purchase additional Medigap insurance to help reduce out-of-pocket expenses.
- They do not include prescription drug coverage or Medicare Part D, which is only available through private insurance companies.
- People who have worked and paid Medicare taxes long enough are eligible for free Medicare Part A coverage, while Part B coverage requires premiums.
Medicare Advantage plans, also known as Medicare Part C, are administered by private insurance companies that contract with the federal government. The most common types of Medicare Advantage plans include health maintenance organizations (HMOs), preferred provider organizations (PPOs), and private fee-for-service plans. These plans vary, but here are some general facts about them:
- They bundle the benefits of Parts A and B and combine them with additional coverage for services such as dental, vision and hearing care.
- They usually include prescription drug coverage.
- They usually include a specific network of doctors from which you must choose.
- They may need a referral to see a specialist.
- They may require you to get approval before certain drug costs or services are covered.
- They generally have lower out-of-pocket costs than the original health insurance plans.
There are two other complementary insurance plans offered by private companies. The Medicare Prescription Drug Plan, or Medicare Part D, is a supplemental plan that covers prescription drugs. This supplemental Medicare insurance is optional for purchase with Original Medicare or with Medicare Advantage plans that do not already cover prescription drugs.
Medigap is a type of insurance that supplements Original Medicare but cannot be purchased with Medicare Advantage. Sold by private insurance companies (and entirely optional), Medigap plans cover the remaining costs after the original health insurance plans have paid their share, including deductibles, coinsurance and copayments. unpaid. Medigap plans can also pay for health care costs not covered by Original Medicare, such as care received while traveling abroad.
Medigap premiums vary by insurance company, but each plan offers a standardized set of benefits. Depending on where you live, you can choose up to 10 Medigap Policies offered in your state. Most states offer standard plans A, B, C, D, F, G, K, L, M, and N, but Minnesota, Massachusetts, and Wisconsin, for example, standardize plans differently. So, do your research before taking out Medigap insurance.
Questions to Ask When Enrolling in Medicare
Now that you know your health insurance options, here are some important questions you should ask before signing up for one or more health insurance plans:
- What are your health care costs now? See if you can quantify your annual outlays, including premiums, copayments, coinsurance and deductibles. This will help you make an informed decision about what changes you could make or what options to choose. Compare your costs to the plans you’re considering, estimating the costs of all the services you plan to receive.
- Do your doctors accept Medicare and what providers are in-network for the plan you can choose? This can make a big difference in the plan you choose, as you probably want to keep your trusted providers. This is especially applicable if you are considering a Medicare Advantage plan.
- Do you have pension insurance that covers certain health costs? For example, many retirees have drug coverage. In this case, you would not need Medicare Part D and you could choose Original Medicare over Medicare Advantage.
- Do you want or need coverage for something specific? Consider your health and how you use your health insurance. If you use a lot of dental or vision services, for example, a Medicare Advantage plan might be the best option.
- What compromises are you willing to accept? A Medicare Advantage plan may have higher premiums but lower out-of-pocket expenses, while an Original Medicare plan generally offers a wider network of doctors and lets you see specialists without a referral.
- Are you eligible for programs that help you reduce your costs? If you qualify, take advantage of state and federal programs like Medicaid which helps with Medicare costs.
Resources for getting information about health insurance
Look for reliable sources to understand Medicare and decide your coverage. Here are some recommendations: