What Is Medicare?

Medicare is a government-funded health insurance program that provides medical coverage for people over the age of 65. You may be eligible for Medicare if you:

• have a disability and have been receiving social security disability benefits for two years
• have a disability pension from the Railroad Retirement Board
• have Lou Gehrig’s disease (ALS)
• have kidney failure (end-stage renal disease) and receive dialysis or have undergone a renal transplant

This health insurance can be used as primary insurance or as supplemental, backup coverage. Medicare can be used to help pay for medical care and long-term care, but it might not cover all your medical expenses.

It’s funded by taxes and, in some cases, premiums that are taken out of your social security checks or that you pay.

Medicare is designed to cover your essential medical needs, such as hospital stays and doctor visits. The program is composed of four parts: Part A, Part B, Part C, and Part D.

Part A and Part B are sometimes called original Medicare. These two parts provide for the majority of essential services.

Part A (hospitalization)

Medicare Part A covers your hospital care, including various hospital-related services. Most of your care related to treatment is covered by Part A if you have to go to the hospital as an inpatient. Part A also covers hospice care for those who are terminally ill.

For most people with a modest income, there will be no premiums. People with higher incomes may have to pay a small amount monthly for this plan.

Part B (medical)

Medicare Part B covers your general medical care and the outpatient care that you may need to stay healthy, including:

• a large portion of preventative services
• medical supplies (known as durable medical equipment, or DME)
• many different types of tests and screenings
• mental health services

There is typically a premium for this type of Medicare coverage, based on your income.

Part C (Medicare Advantage)

Medicare Part C also known as Medicare Advantage, is not actually a separate medical benefit. It’s a provision that allows approved private insurance companies to provide insurance plans to people who are enrolled in Parts A and B.

These plans cover all the benefits and services that parts A and B cover. They may also offer extra benefits, such as prescription drug coverage, dental, vision, hearing, and other services. Medicare Advantage plans usually have additional fees such as copays and deductibles. Some plans have no premiums, but if the plan you choose has a premium, it may be deducted from your social security check.

Part D (prescriptions)

Medicare Part D covers prescription drugs. The cost or premium for this plan depends on your income, and your copayments and deductible depend on the type of medications you need.

Medicare provides a list, called a formulary, of drugs each Part D plan covers so that you will know if the medications you need are covered by the plan you are considering.

Medicare supplement (Medigap)

Even though Medicare supplement isn’t called “part,” it is one of the five major types of Medicare insurance for you to consider. Medigap works with original Medicare and helps cover the out-of-pocket costs that original Medicare does not.

Medigap is sold by private companies, but Medicare requires that most states offer similar coverage. There are 10 Medigap plans available: A, B, C, D, F, G, K, L, M, and N. Each plan is slightly different in the specifics of what it covers.

If you were first eligible for Medicare after January 1, 2020, you are not eligible to purchase plans C or F; but, if you were eligible prior to that date, you can purchase them. Medigap Plan D and Plan G currently provide similar coverage as plans C and F.

You’ll automatically be enrolled in the program if you’re already receiving social security benefits. If you aren’t already receiving benefits, you can contact the social security office up to three months before your 65th birthday to enroll.

The Social Security Administration handles Medicare enrollment. There are three easy ways to apply:

• using the Medicare online application at the Social Security Administration’s website
• calling the Social Security Administration at 1-800-772-1213 (TTY: 1-800-325-0778)
• visiting your local Social Security Administration office

If you’re a retired railroad employee, contact the Railroad Retirement Board at 1-877-772-5772 (TTY: 1-312-751-4701) to enroll.

When choosing the Medicare options to meet your healthcare needs, it’s important to consider your healthcare needs. Here are a few tips for choosing a plan or combination of plans to work for you:

• Try to estimate how much you spent on healthcare last year that way you can better estimate which plans will save you money.
• List your medical conditions so you can be sure they are covered by the plans you consider.
• List the doctors you currently see and ask if they accept Medicare or which Health Maintenance Organizations (HMO) or Preferred Provider Organization (PPO) networks they may be in.
• List any medical treatment or hospitalizations you may need in the upcoming year.
• Note any other insurance you have, if you can use it with Medicare, and how to end that coverage if necessary.
• Do you need dental work, wear glasses or hearing aids, or would you like other additional coverage?
• Do you or are you planning to travel outside your coverage area or out of the country?

All of these factors can help you decide which parts of Medicare may best meet your needs and which individual plans to consider.

While Medicare original Medicare provides coverage for many services, not every medical situation is covered. For example, long-term care is not considered part of Medicare. If you need long-term care, consider a Medicare Advantage or Medigap plan which may offer limited long-term care benefits.

Since prescription drugs aren’t covered by original Medicare, if you need prescription drug coverage, you will need to enroll in Medicare Part D or Medicare Advantage, which offers plans that cover some prescription drugs.

• Knowing which plans are right for you depends on your income, overall health, age, and what kind of care you will need. It’s best to read through the services and plans carefully and choose the plans that work best for you.
• Enrollment periods are limited for some plans, so be sure you sign up so you don’t have a gap in coverage.
• If you’re concerned about whether your desired service is covered by Medicare, you can speak ask your doctor, search the Medicare Coverage Database online at www.cms.gov/medicare-coverage-database/, or contact Medicare at 1-800-MEDICARE (1-800-633-4227).