Medicare can be confusing! Let’s clear up some of the uncertainty by answering the five most common Medicare questions!
How Much Does Medicare Cost?
Costs can vary from person to person. However, it is very easy to get a better idea of premiums on Medicare.gov. Just use the plan finder. Many people enroll in Medicare not knowing that they have to pay anything at all!
Medicare Part A:
Part A is your hospital insurance and part of Original Medicare. Usually, you will not have a monthly premium for Part A. You’ll have a deductible that you have to meet and possibly coinsurance.
Medicare Part B:
Part B is your outpatient insurance and part of Original Medicare. You’ll be responsible for a monthly premium based on your income. In 2021, the base premium is $148.50 (or more based on your income). They’ll look at your tax return from two years prior. So if you’re making less money now than you were then, make sure to file form SSA-44. Additionally, there are programs that can help you pay for your Part B premiums. If you are eligible, make sure to look into Medicare Savings Programs. For Part B, you’ll also have to meet a deductible and then you’ll be responsible for coinsurance.
You may also choose to enroll in Medicare Supplement Plan (Medigap), Medicare Advantage (Part C) or Medicare Part D (Prescription Drug Coverage).
Medicare Supplement Plans
Medigap Plans fill in the gaps of Original Medicare to limit your out of pocket costs. The cost is determined by your age, plan, carrier, and state. The costs can vary quite widely. Check out the plan finder on Medicare.gov for a more narrowed down price range. Remember, these plans are standardized. If your doctor accepts Medicare, they accept your supplement plan. This makes it much easier to comparison shop.
Medicare Advantage Plans
Advantage Plans or Medicare Part C actually replaces Original Medicare entirely. Some plans actually boast a $0 monthly premium. However, they’re not really free! Additionally, they are not for everyone, so buyer beware!
Part C plans encapsulate the benefits of Original Medicare and limit out of pocket costs. Very often they’ll offer prescription coverage plus additional benefits such as dental, vision, hearing and more. Usually, they’re less expensive than supplement plans. However, there are definite drawbacks. They’re not standardized, so do your research. Shop around or (ideally) use a broker.
Medicare Part D
Finally there is Part D, which is your prescription drug coverage. Plans are federally regulated, but offered by private carriers. Different carriers may offer enhanced benefits to compete for your business. You can compare the plans on Medicare.gov. In addition to your monthly premium, you may be responsible for a deductible. There are also copays dependent upon the tier of the medication.
How & When Do I Sign Up
Original Medicare
You will most likely be automatically enrolled in Original Medicare (Part A & B) around your 65th birthday. You’ll receive your card in the mail. If you are not automatically enrolled, you have a seven month window to do so without penalty. This is the three months before you turn 65, the month of your 65th birthday and the three months thereafter. If you choose to defer Part B because you are still working, you need to do so during this window. Make sure to follow the instructions on the back of the card and send it back. If you keep the card, you keep Part B and you will be charged for it!
Medigap Plans
For Supplement Plans (Medigap) you can sign up at any time during the year. However, if behooves you to do so during your individual enrollment period. This is the six months after you have turned 65 and enrolled in Medicare Part B. During this time, you will not be subject to medical underwriting. This means you cannot be denied based on your health. You can view the available plans on Medicare.gov, but you will eventually be redirected to contact the carrier directly. That’s quite a bit of leg work, so as always, we recommend working with a licensed broker (ideally one that does not charge a fee).
Medicare Advantage Plans
You can sign up for Part C (Advantage Plans) and Part D during the same time you enroll in Original Medicare. As a reminder, that’s the three months before you turn 65, the month of your 65th birthday and the three months thereafter. You can also enroll during the annual enrollment period which is every year from Oct.15-Dec. 7. During this time you can join, drop or switch a plan. Make sure you choose wisely because you’ll most likely be locked in for a year. Again, you can view all of the available options of Medicare.gov.
What’s the Difference Between Medicare Advantage & Medicare Supplement Plans?
Medicare Supplement Plans (aka Medigap) & Medicare Advantage Plans (aka Part C) both cover the gaps of Original Medicare and limit your out of pocket costs, but they’re actually very different.
| Medigap Plans | Advantage Plans | |
| Does not include prescription drug coverage | Most plans include prescription drug coverage | |
| Choice of any doctor or hospital that accepts Medicare | Limited to typical HMO or PPO in and out of network charges dependent upon your plan and carrier. You may have to travel a distance to see someone who is in the network. | |
| Monthly costs average $50-$200 dependent upon your plan, carrier and state | Monthly costs average $0-100 dependent upon your plan, carrier and state | |
| Does not require referrals to see a specialist | May require referrals to see a specialist | |
| Standardized benefits | Much wider variety of plans and carriers with different benefits such as dental, vision, hearing, and wellness. BUT these benefits may be dropped annually. | |
| Medical underwriting may be required. | No medical underwriting is required. |
How Do I Get Prescription Drug Coverage?
Your two options for prescription drug coverage are Part D or Part C (Advantage Plans). Not all Part C plans offer prescription drug coverage. However, if you’re going that route make sure you enroll in a plan that does! Remember, that if you go for more than 63 days after enrolling in Medicare without RX coverage you may be charged a late penalty.
What About Dental, Vision, & Hearing?
Medigap Plans do not cover these additional benefits. So, if you want a Medicare solution, you’ll need to look into an
Advantage Plan. However, we advise you to consider your basic and more prominent health needs first.
Private insurance for dental, vision, & hearing is readily available. Also, it’s actually much less expensive than you might think. A private dental plan usually costs between $15-$50 per month. Additionally, you’ll far more options than dental benefits that are roped into a Part C plan.
Medicare offers many personalized solutions, but more options definitely means more confusion. Please feel free to call us today at 888-918-0518 or schedule a call today!
Jesse Smedley is the Principal Broker for iHealthBrokers and the founder, president, and CEO of Smedley Insurance Group, Inc. and iHealthBrokers.com. Since the inception of SIG in 2007, Jesse has been dedicated to helping people save money on their health insurance by providing them with resources to educate themselves on all their health insurance options, both under age 65 and Medicare beneficiaries. He is featured in many publications as well as writes regularly for expert columns regarding health insurance and Medicare.
