Medicare: Make Sure You Don’t Miss a Part!

Medicare is our country’s health insurance program for people age 65 or older. Certain people younger than age 65 can qualify for Medicare, too, including those who have disabilities, permanent kidney failure or amyotrophic lateral sclerosis (Lou Gehrig’s disease). The program helps with the cost of health care, but it does not cover all medical expenses or the cost of most long-term care. For more information about planning for these costs please see my blog entries: Think You’re Covered? Think Again. What Medicare doesn’t pay for…Posted on August 28, 2011 as well as Long Term Care Planning, Do You Need It? Posted on August 6, 2011.

Medicare is financed by a portion of the payroll taxes paid by workers and their employers. It also is financed in part by monthly premiums deducted from Social Security checks. The Centers for Medicare & Medicaid Services is the agency in charge of the Medicare program and you apply for Medicare at Social Security.

Medicare has four parts

• Hospital insurance (Part A) helps pay for inpatient care in a hospital or skilled nursing facility (following a hospital stay), some home health care and hospice care.
• Medical insurance (Part B) helps pay for physicians’ services and many other medical services and supplies that are not covered by hospital insurance.
• Medicare Advantage (Part C) plans are available in many areas. People with Medicare Parts A and B can choose to receive all of their health care services through one of these provider organizations under Part C.
• Prescription drug coverage (Part D) helps pay for medications physicians prescribe for treatment.

If you are like most people, you will want to enroll in Medicare when you turn 65. (However, see WSJ article discussing social security changes and raising the retirement age.)  Enroll promptly, if you are planning to participate. Medicare participation is not mandatory.

If, like many of us, you plan to enroll at 65  it is important to contact the local Social Security office within three months before your 65th birthday. This ensures that you can participate in parts A and B with no delays in coverage and no penalties.

If you don’t join a Medicare prescription drug plan when you’re first eligible, you must wait until your next enrollment opportunity to join.  This delay may result in your having to pay a higher premium due to medicare enrollment penalties .  You can calculate what your late fee might be with the medicare late penalty calculator.

Also, if either you or your spouse is a veteran you may be entitled to the aid and attendance improved pension benefit or certain medical benefits.