Sorting Through Your Medicare Options

If you are approaching the age of 65, you may be thinking about Medicare coverage and how to sign up for this important, government-funded healthcare. Your initial efforts to understand the many aspects of the Medicare program may be daunting, but you can master the task by understanding a few basic principles and determining how they relate to your individual needs. Fortunately, the Medicare government-sponsored site, as well as other helpful sites, offers a number of tools to compare these options side by side to make your selection easier.

Original Medicare - Parts A & B

The original Medicare program consists of two separate parts: one that pays for hospitalization and one that pays for physicians and other medical services. Part A is provided without charge as part of the Medicare program, but the enrollee must pay for Part B coverage, which is currently around $104 per month. Under Medicare Part A, the enrollee must pay a deductible for each benefit period and a coinsurance after 60 days in the hospital. Under Medicare Part B, the enrollee must pay a small deductible each year.

Medicare Part C - Medicare Advantage

In 2003, another way of delivering Medicare benefits to seniors was implemented. Medicare Part C, also called Medicare Advantage, contracts with private health insurance companies to provide managed care for seniors enrolled in the Medicare program. These companies are then paid for the basic medical services through the taxpayer-funded Medicare plan. The plans offer a variety of different coverage options to suit each senior's needs. However, medical services are provided through a limited network of physicians and services. Those enrolled in these Medicare Advantage plans must stay within the network to have their medical care covered. Outside of the networks, seniors generally must pay more of the costs. Some of these plans require additional premiums that must be paid by the enrollee.

Medigap Plans - Supplemental Insurance

Medigap plans were created to fill in the "gaps" not covered by original Medicare Parts A and B. You cannot purchase a supplemental Medicare plan if you opt for a Medicare Advantage plan. Seniors can choose from a wide range of plans with varying percentages for uncovered expenses and copayments. Some of the plans also cover hospice care deductibles, deductibles for skilled nursing care and medical expenses while traveling. These plans also vary widely in cost. A side-by-side comparison of supplemental plans can help you to find the right one for you.

Factors to Consider in Choosing Your Plan

When considering Medicare options, finding a plan that will fill your own individual healthcare needs with the smallest out-of-pocket cost should be your primary goal:>

  • If you are in good general health with no major illnesses, you may benefit from a Medicare Advantage plan that allows no or low copays for a primary care doctor and specialist visits.
  • If you have one or more major illnesses that require ongoing treatment and frequent hospitalization, you may benefit from original Medicare, plus a Medicare supplemental plan that pays for uncovered expenses.
  • If you take a number of expensive medications to manage a health condition, you should also ensure that you sign up for Medicare Part D drug coverage or choose a Medicare Advantage plan that also covers prescription drugs. Be aware that not all Medicare Advantage plans cover prescription drugs.
  • If you would like help paying for dental or vision expenses, you should choose a Medicare Advantage plan that offers coverage for these needs. Not all Medicare Advantage plans offer these types of coverage, so you must read the plan coverages carefully before making your choice.

Individuals getting ready to sign up for Medicare should expect to spend considerable time researching the options that are available to them. At first glance, the many choices may be confusing, but taking time to compare the variety of policies can pay off in lower costs throughout the year. Enrollees should also be aware that Medicare provides an open enrollment period each year during which enrollees can change plans if their medical needs have changed during the year.

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