Jeffrey Wade
Medicare is the federal health insurance program for people aged 65 and over. If you are under 65, you may be eligible for Medicare if you have a disability, End-Stage Renal Disease (ESRD), or ALS (Lou Gehrig's Disease). Medicare Part A covers hospitalization, home or skilled nursing, and hospice, while Medicare Part B is medical insurance. If you are already enrolled in Medicare, you can still have private health insurance at the same time, known as dual coverage. This can provide additional coverage and potentially lower out-of-pocket costs but may be more complex to manage.
| Characteristics | Values |
|---|---|
| Medicare Part A | Hospital Insurance |
| Medicare Part B | Medical Insurance |
| Medicare Part C | Medicare Advantage Plans |
| Medicare Part D | Prescription medications |
| Initial Enrollment Period | Begins 3 months before turning 65 and ends 3 months after the month of turning 65 |
| Late Enrollment | May have to pay a penalty |
| Medicare Advantage Plan | Administers your benefits and sets its premiums, deductible, and coinsurance/copayment amounts |
| Medicare Supplement Insurance (Medigap) | Extra insurance to help pay your share of costs in Original Medicare |
| Medicare and Private Insurance | Can have both at the same time, known as "dual coverage" |
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What You'll Learn
Medicare Part A and Part B
Medicare is federal health insurance for anyone aged 65 and older, as well as some people under 65 with certain disabilities or conditions. Medicare Part A (Hospital Insurance) and Medicare Part B (Medical Insurance) are available to individuals who are eligible for premium-free Part A based on their own earnings or those of a spouse, parent, or child. Most people get Part A for free, but some have to pay a premium for this coverage.
To be eligible for premium-free Part A, an individual must be entitled to receive Medicare based on their own earnings or those of a spouse, parent, or child. To receive premium-free Part A, the worker must have a specified number of quarters of coverage (QCs) and file an application for Social Security or Railroad Retirement Board (RRB) benefits. The exact number of QCs required depends on whether the person is filing for Part A on the basis of age, disability, or End-Stage Renal Disease (ESRD). If you can't afford the monthly premiums, there are programs to help lower the costs.
Individuals who do not enroll in Part B or premium Part A when first eligible may enroll using a Special Enrollment Period (SEP). This SEP is a 6-month period that begins the earlier of the first day of the month following the month for which the individual was no longer serving as a volunteer outside of the United States. Individuals who enroll in Part A based on disability or ESRD, but do not enroll in Part B because they were eligible for TRICARE Standard or TRICARE Prime, may enroll using this SEP.
Part A helps cover inpatient care in hospitals, skilled nursing facility care, hospice care, and home health care. After signing up for Part A and Part B, you can choose how you get your coverage. You can choose to receive your Medicare coverage through Original Medicare or a Medicare Advantage Plan (like an HMO or PPO). You can also add Medicare drug coverage (Part D) to either option. These "bundled" plans include Part A, Part B, and usually Part D.
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Medicare with private insurance
Medicare is a public health insurance programme funded by the government. It is available to individuals who are 65 or older, or those who have a qualifying disability or medical condition.
Medicare is split into four parts: Part A, Part B, Part C, and Part D. Part A covers hospital insurance, and Part B covers medical insurance. Part C, also known as Medicare Advantage, is where private companies approved by Medicare provide Parts A and B benefits, and sometimes Part D. Part D covers prescription drug costs.
If you are still working when you turn 65, you can still get Medicare, but it works a little differently. You can choose to sign up for Medicare Part A when you turn 65, or anytime after, without paying a premium if you don't have to pay one already. If you have group health insurance through your employer, you can wait until you stop working or lose your health insurance to sign up for Part B without paying a late enrollment penalty.
If you are covered by an employer-provided plan, COBRA, or TRICARE, you can have both Medicare and private insurance. If you have both, a process called "coordination of benefits" determines which insurance provider pays first. This provider is called the primary payer, and they pay for any covered services until the coverage limit has been reached. The secondary payer then covers any costs that the primary payer doesn't cover, but they may not cover all of the remaining costs. The provider who is the primary payer depends on the type of private insurance you have and your individual situation. In some cases, Medicare may be the primary payer, and in others, it may be the secondary payer.
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Medicare enrolment periods
Initial Enrollment Period
The Initial Enrollment Period is when most people first become eligible for Medicare, usually when they turn 65. This period lasts for 7 months, starting 3 months before your 65th birthday and ending 3 months after the month you turn 65. If you miss this 7-month window, you may have to pay a late enrollment penalty for as long as you have Part B coverage. The penalty increases the longer you wait to sign up.
General Enrollment Period
If you miss the Initial Enrollment Period, the General Enrollment Period is your next opportunity to sign up for Medicare. This period runs from January 1st to March 31st each year. However, if you enrol during this period, your coverage will not start until the following month, and you may have to pay a late enrollment penalty.
Special Enrollment Period
The Special Enrollment Period (SEP) is available in certain unique situations. For example, if you were still working and covered by an employer's group health plan when you turned 65, you can enrol in Medicare within 8 months of losing your job or the group health plan ending, whichever comes first. Additionally, there are SEPs for individuals who did not enrol in Part B or premium Part A when first eligible due to specific circumstances, such as performing volunteer service outside the US for at least 12 months or having coverage through TRICARE.
Annual Open Enrollment Period
The Annual Open Enrollment Period, from October 15th to December 7th, is when you can make changes to your existing Medicare coverage. During this period, you can join, switch, or drop a Medicare Advantage Plan (Part C), other Medicare health plan, or Medicare drug plan (Part D).
It is important to note that Medicare enrolment periods are subject to change, and specific situations may have different rules. Always check with official sources for the most up-to-date and accurate information.
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Medicare and retiree coverage
Medicare is available to individuals who are 65 or older. If you are still working when you turn 65, you may be able to delay signing up for Medicare without incurring a late enrollment penalty. However, it is important to understand how retiree coverage works with Medicare.
Retiree health coverage is health insurance that some employers, unions, and trusts may offer to retiring employees and their spouses. It is typically group health insurance similar to plans offered to active employees. Even if you have retiree health coverage, you will likely need to sign up for Medicare. Depending on the plan, you may need to sign up for Part A and Part B, or just Part A (provided you are eligible for Part B).
If you have retiree coverage from a previous job, it may not pay for your health services if you do not also have Medicare Part A (Hospital Insurance) and Part B (Medical Insurance). Your employer may offer additional coverage when you have Medicare, such as a supplemental plan, drug coverage, or a Medicare Advantage Plan. Before joining a new plan, it is important to check whether you will lose your retiree coverage.
If you have both Medicare and retiree coverage, Medicare typically pays first for your healthcare bills, and your retiree plan covers any amount that Medicare does not. Retiree coverage may also provide benefits that Medicare does not, such as vision, dental, and prescription drug coverage.
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Medicare Advantage plans
It is important to note that joining a Medicare Advantage Plan may cause you to lose your existing employer or union coverage. Therefore, it is recommended to consult your employer, union, or benefits administrator about their rules before enrolling in a Medicare Advantage Plan. Additionally, if you have a Health Savings Account (HSA), you and your employer should stop contributing to it at least 6 months before enrolling in Medicare to avoid tax penalties.
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Frequently asked questions
Yes, you can have both Medicare and private health insurance at the same time. This is known as "dual coverage". However, if you already have Medicare, you cannot use the ACA marketplace to buy a private insurance plan.
Medicare is a federal insurance program for people over the age of 65 and for certain people with disabilities or a health condition such as end-stage renal disease (ESRD) and Lou Gehrig's disease (ALS). Private health insurance, on the other hand, is offered by private insurance companies.
The Initial Enrollment Period to sign up for Medicare begins 3 months before you turn 65 and ends 3 months after the month you turn 65. You may have to pay a penalty if you miss this period.
