I wrote this as an easy read overview about how Medicare works.
As we grow older, our health care needs tend to become greater, and so is the amount of money needed to bring us back to a state of wellbeing.
That is why we need to understand not just what Medicare is, but the nitty-gritty as well. That is what this article will be discussing.
WHAT IS MEDICARE?
Medicare is a federal health insurance program through which the government subsidise for the healthcare of the elderly, the disabled, and others with certain illnesses.
Medicare can be separated into 4 distinct parts.
Part A (inpatient or hospital coverage), is the part that covers hospital and nursing services. Part B (outpatient or medical coverage), covers preventive services such as diagnostic tests and doctor visit.
Part A and B makes up what is known as original Medicare.
part C, also known as Medicare advantage plan, provides you with part A and B services, with some additional services, while part D covers prescription drugs. Although, part A is basically free, parts B, C, and D comes with a premium.
HOW DOES ONE BECOME ELIGIBLE FOR THIS SERVICE?
- The first thing is that you have to be an American citizen or at least, be a permanent legal resident for the past 5 years.
- You should also be 65 years of age and above
- You or your spouse must be a government employee or retiree who has Paid Medicare taxes.
There are individuals, however, that are under the age of 65, but still eligible. They are:
- People with the end-stage renal disease.
- People with ALS
- And anyone who is permanently disabled, and has been given disability benefits for at least, 2 years.
If you are eligible, you can sign up for Medicare once your initial enrolment period commences. That is, 3 months before you clock 65.
HOW MUCH DOES MEDICARE COST?
Unlike the opinion of many, Medicare is not free! That opinion could only be right if it refers to Medicare part A alone, in that the average enrollee doesn’t have to pay a premium.
Yet, there are other out-of-pocket costs associated with part A which might be well over a thousand dollars.
Part B, C, requires the payment of a premium however, for example, most part B is $134 per month in 2017, with a deductible of $183 per year.
Still, enrollees usually pay 20% of the Medicare-approved amount for the covered services.
HOW DO I ENROLL IN MEDICARE?
Enrolment could be either automatic or require signing up.
To sign up, you should do this during your initial enrolment period, lest you have to pay a penalty.
If you missed the initial enrolment period, you will be able to sign up during the open enrolment period called Annual Election Period, which is open from January 1 to March 31st of each year.
If you are already receiving social security or railroad requirement benefits, you will be automatically enrolled in Medicare parts A and B.
the same thing is applicable to disabled individuals under 65 who have fulfilled the same requirements.
The next thing you have to do after enrolling is to pick a Medicare plan or supplement, if you choose. There are several articles in this blog about the different types of plans available to you. If you have questions you need an immediate answer to, feel free to give me a call.