This year's open enrollment period runs through December 7. Here's what you need to know about the ABCs (and D's) of this federally funded health insurance program.
If you or a loved one has a 65th birthday approaching, you need to do more than review those 401(k) balances, plan that long-awaited trip to the Galapagos Islands or ruminate on the march of time. This is the age of eligibility for Medicare, the federally funded health insurance program most Americans use to cover their health care in retirement.
Be prepared to spend a while learning about the alphabet soup of choices, costs and deadlines to make the most of the program that now covers more than 60 million Americans. Most people who are 65 and older and have had Medicare and Social Security taxes deducted from their paychecks for at least 10 years qualify for the program. Spouses, even if they have not paid taxes for the required decade, also qualify. Medicare also covers younger people with long-term disabilities.
But Medicare doesn’t automatically kick in when you turn 65. You must enroll during a seven-month period that starts three months before your 65th birthday, includes the month of your birthday and extends three months after your birthday. And if you miss this window? You can still sign up for benefits—but you might face penalties.
“Medicare can be very confusing,” says John Norce, president of Vienna-based Medicare Portal, an insurance broker who provides free help in finding plans and understanding the ins and outs of Medicare. “It’s absolutely paramount you’re aware of this enrollment period and start your research early.”
Part A: Everyone who qualifies for Medicare automatically receives this part, which covers inpatient hospital stays, as well as skilled nursing and home health care in certain circumstances. It is provided without cost, but there is a deductible of $1,364 for the first 60 days you stay in the hospital. (All costs listed in this article are for 2019.) If your stay extends past 60 days, you are required to pay a copayment for Part A. In 2019, for example, days 61-90 of a hospital stay require a copayment of $341 per day. Those who have worked and paid taxes for less than 10 years must pay a premium to get Part A.
Part B: This Medicare program covers such services as doctor visits, preventive care, outpatient surgery and lab tests from providers who accept Medicare. This is the part that you must enroll in at age 65. The monthly premium for Part B is determined by your household income. This year, most Americans with Medicare paid $135.50 for the Part B premium, but the amount increases for people with incomes of $85,000 and over (single) or $170,000 and above for those filing joint tax returns. There is also an annual deductible of $185. After the deductible, you will pay 20 percent of Medicare-approved costs.
Part C: Together, Medicare Parts A and B are often referred to as Original Medicare. That’s because there are also private insurance options (collectively known as Part C or Medicare Advantage plans) that can help cover additional costs, such as copayments. Some also cover prescription drug and dental costs. Part C plans primarily operate like HMOs (health maintenance organizations) or PPOs (preferred provider organizations). Just as with health insurance before you are eligible for Medicare, you will be restricted to using providers covered by a network. To get Part C, you must first have Parts A and B, and pay the Part B premium.
Part D: This newest optional addition to Medicare began in 2006 and covers prescription drug costs through private insurance companies. Each company has its own list of covered drugs (called a formulary), so choosing a plan entails researching which one includes all or most of the medications you take. Those enrolled pay a premium and often a deductible.
Medigap plans: These plans operate much like Medicare Advantage plans through private insurance companies. But you must choose either a Medigap or Medicare Advantage plan, because you can’t have both. And just to make it a bit more confusing, Medigap plans—also referred to as Supplemental Medicare—are also named using letters. In Virginia, there are 11 plans.
Review plans now
Already have Medicare? Each fall, there’s a six-week period known as Open Enrollment, in which you can change drug, Medigap and Medicare Advantage plans for the next year. Even if you’re satisfied with what you have, note that the plans may change what they cover in the coming year. So don’t just recycle the mailings from your insurance companies and advertisements for other ones that may flood your mailbox. This year the Open Enrollment period is Oct. 15 to Dec. 7.
“If your formulary changed, you need to know that. If your drug is no longer on your plan, tough noogies if you don’t find another one,” Norce says. “You will pay the full cost starting in January. It behooves you to take five or 10 minutes to figure it out.”
Getting your questions answered
For those who need extra help figuring it all out (and most people do), here are some free resources to answer questions and make sense of the multitude of options:
- Virginia Insurance Counseling and Assistance Program (VICAP) is a government Medicare education program with offices in each county, as well as free “Medicare 101” classes, which are listed on their websites:
Arlington County, 703-228-1700, aging-disability.arlingtonva.us/programs/vicap/
Fairfax County, 703-324-5851, fairfaxcounty.gov/familyservices/older-adults/virginia-insurance-counseling-and-assistance-
- At Medicare.gov, you can apply for Medicare, find out what’s covered, review your statements and more. Information is also available at 1-800-MEDICARE (1-800-633-4227).
- Medicare Portal offers free classes across Northern Virginia. For a list of classes and more information about Medicare, see medicareportal.
org or call 703-214-4600.
- Are you a federal employee enrolled in the Federal Employee Health Benefit Program? Learn about your Medicare options at opm.gov/healthcare-insurance/healthcare/medicare.