Medicare has many fine details that can come as a shock to new Medicare beneficiaries. Without proper preparation and research, you may fall victim to late penalties, underwriting, and delayed start dates. While there is much to learn about Medicare before you turn 65, here are five things you should definitely be aware of.
1. You have specific enrollment periods for each part of Medicare
There are specific enrollment periods for each part of Medicare, some of which are unique to you. For example, your Initial Enrollment Period (IEP) is based on your 65th birthday month. During your IEP, you can apply for Medicare Part A, Part B, and Part D.
Another enrollment period that is specific to you is your one-time six-month Medigap Open Enrollment Period. This window starts on your Part B effective date and is generally the only time you are guaranteed approval for a Medigap plan.
Other enrollment periods include the Annual Election Period, General Enrollment Period, and the Medicare Advantage Open Enrollment Period.
2. You can enroll in a Medigap plan or a Medicare Advantage plan, but not both
Medicare Part A and Part B are administered by the Social Security Administration (SSA). These parts come with deductibles and unlimited copays, and coinsurance. You can enroll in a Medigap or Medicare Advantage plan to cover or lower these out-of-pocket costs through a private insurance carrier. However, you cannot enroll in both; it’s one or the other.
Medigap plans pay after Part A and Part B to cover your cost-sharing expenses, whereas Medicare Advantage plans pay instead of Part A and Part B and create their own cost-sharing structures which are capped each year. Without one of these plans, you’d be responsible for 100% of your Medicare cost-sharing expenses.
3. You still pay the Part B premium when you’re enrolled in a Medigap or Medicare Advantage plan
Some people think that because Medigap plans cover your Part A and Part B expenses, they will also cover your Part B premium. Others believe that since Medicare Advantage plans pay instead of Part A and Part B, you no longer have to pay the Part B premium once enrolled. However, neither of these is true.
You must be enrolled in Part A and Part B to enroll in a Medigap or Medicare Advantage plan. Therefore, you are still responsible for the Part B premium when enrolled in either of these plans.
4. You’ll need a Part D plan for most prescriptions
Medicare Part D is also provided by private insurance carriers and is responsible for most of your prescription coverage. If you have just Part A and Part B or have Part A and Part B with a Medigap plan, you’ll need a standalone Part D plan. However, if you have a Medicare Advantage plan, your Part D plan is likely built into your Advantage plan.
If you don’t enroll in some kind of Part D plan when you’re first eligible and don’t have other creditable coverage, you open yourself to future lifelong late penalties. Even if you don’t take medications, you should still enroll in a Part D plan in your area so you have coverage when it’s needed, and you aren’t charged late penalties.
5. Medicare doesn’t cover routine dental, vision, and hearing services
Medicare covers services that are deemed medically necessary to treat or diagnose a medical condition. Generally, Medicare doesn’t consider routine dental, vision, and hearing services to be medically necessary. Therefore, if you’d like coverage for these services, you will need to enroll in a standalone plan or a Medicare Advantage plan that includes them.
However, Medicare may cover routine dental, vision, and hearing services under certain circumstances. For example, Medicare will cover a dental exam prior to an organ transplant surgery. Medicare also covers one eye exam each year if you have diabetes to monitor diabetic retinopathy.
These are five of the most important things to be aware of with Medicare. However, Medicare can throw you many curveballs, so you’ll want to learn as much as you can before enrolling so you can be prepared for anything Medicare may throw your way.
