Health Advisory

Medicare 101: How It Works and How to Enroll

Many people have questions about Medicare. We put together this guide to provide answers.

Medicare, the federal insurance program for people 65 or older, insures 64.5 million people across the United States. Many people have questions about whether they're eligible, how to enroll, and how Medicare works.

We put together this guide to provide answers, take the confusion out of the Medicare enrollment process, and ensure that you have the best coverage for your specific health and wellness needs.

What is Medicare?
Medicare is a health insurance program run by the U.S. government. It provides health insurance for Americans 65 and older and for some younger people with qualifying disabilities.

There are four parts of Medicare:

  • Part A: Hospital Insurance (inpatient care)
  • Part B: Medical Insurance (outpatient care)
  • Part C: Medicare Advantage (combines coverage of Part A, Part B, and sometimes a prescription drug plan and other additional benefits)
  • Part D: Prescription Drug Plan 

Part A and Part B are collectively referred to as “Original Medicare.”
In addition to Part A, Part B, and Part D, many people also purchase a Medigap (supplemental) Policy to pay for some of the costs not paid for by Original Medicare.

Do I enroll in all of these?
No. The first step is to choose how you want to get your coverage. See the flowchart below:

How do I enroll in Medicare?
If you receive Social Security or Railroad Retirement Board benefits, you will automatically be enrolled in Part A and Part B when you turn 65.If you do not receive those benefits, you can sign up for Medicare through the Social Security Administration. If you don’t collect Social Security when you turn 65 and are still working and have insurance coverage, you can wait to enroll in Medicare until after you stop working and are no longer covered by your employer-based insurance policy.

We recommend that you enroll in Medicare Part A as soon as possible, regardless of whether you already have health insurance coverage. For most people, it won't cost anything. If you do not have other coverage, enroll in Part B prior to the month of your 65th birthday. There is a seven month window for the Initial Enrollment Period. It begins 3 months before the month of your 65th birthday and extends 3 months after the month of your 65th birthday. If you miss this window, you may be subject to late fees.

High-net-worth individuals and/or people who are still working and insured through their employer often have more health insurance options, and evaluating them can be complex. Consider consulting with a health advisor to identify the best coverage and the best doctors to meet your needs.

Can I make changes to my Medicare plan?
Yes. You can join, switch, or drop a plan during open enrollment. If you already have Medicare, you can make changes from October 15 – December 7 each year. As long as the plan receives your request by December 7, your coverage will begin on January 1.

If you have a Medicare Advantage Plan, you can switch plans or return to Original Medicare and join a separate Medicare drug plan from January 1 – March 31. Note: You can only switch plans once during this period.

Medicare Tips

  1. If you have Original Medicare, you can see any doctor that accepts Medicare. Your doctor will submit the claims for you. Any doctor that accepts Medicare will also accept your supplemental insurance. If you have Medicare Advantage, the provider list is limited.

  2. Medicare Advantage has some disadvantages. Compared to Original Medicare, Medicare Advantage has a smaller network of doctors and typically requires you to get referrals for specialists.

  3. Medicare Advantage has an annual out-of-pocket limit. This is not the case with Original Medicare. However, if you have Original Medicare, a Medigap policy can cover many of the out-of-pocket costs.

  4. You can appeal high premiums. If you have had a decrease in income due to retirement, divorce, the death of a spouse, or other life events, you can appeal the high income surcharge.

If you or a loved one need more information about Medicare or help enrolling, reach out to an expert health advisor.

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