Most American citizens and legal residents become eligible for Medicare health coverage when they turn 65 years old. Eligibility for Medicare requires that an individual is a U.S citizen or permanent legal resident for 5 continuous years and is eligible for Social Security benefits with at least 10 years of payments contributed into the system. The initial Enrollment Period for Medicare actually starts three months before you turn 65, so you can start applying for and setting up your coverage three months before you turn 65. This is the suggested time to begin your enrollment with Medicare. Medicare is made up of four component Parts: Part A, B, C and D. Part A and Part B make up “traditional” Medicare coverage while Parts C and D can help to minimize out of pocket payments. Below is further explanations for each sector.
Part A (Hospital Insurance)
Hospital Insurance, or Part A, helps cover inpatient care in hospitals, skilled nursing facility (SNF) care, hospice care, and home health care. If a doctor admits a Medicare enrollee as an inpatient with the expectation that the patient will require hospital care across two midnights, Medicare Part A will be appropriate for coverage. Part A is often called the “Two-midnight rule”. Medicare Part A will cover hospital inpatient stays (consecutive or intermittent) up to 90 days. The first 60 days would all be covered in full by Medicare following a one-time copayment and after that, days 61-90 will require a daily copayment. Part A will be free if the enrollee has worked and paid Social Security taxes for at least 40 calendar quarters (10 years). You will pay a monthly premium if you have worked and paid taxes for less time. Not delay the start of your coverage The other instances in which you would be entitled “guaranteed issue” is if:
Part B (Medical Services Insurance)
Medical Insurance, or Part B, attempts to cover products and services that are not covered by Part A, generally on an outpatient basis. Part B will pay for 80% of the Medicare-approved services and the remaining 20% is paid by the patient. Unlike Part A, Part B requires a monthly premium. Part B covers two types of services: medically necessary services and preventive services. Medically necessary services are those that are required to diagnose or treat a medical condition. Preventive services are services that can prevent illness or discover it at an early stage, when treatment would be most effective. These two covered types of services are extensive and include many outpatient services.
Part C (Medicare Advantage Plans)
Medicare Advantage, or Part C, is provided by private insurance companies. For more information about Part C please visit our Medicare Advantage Plans Page here.
Part D (Prescription Drug Plan)
The Prescription Drug Plan, or Part D, subsidizes the cost of prescription drugs and prescription drug insurance premiums for Medicare beneficiaries. To qualify for a Part D plan, prospective beneficiaries must have already signed up for benefits under Medicare Part A and/or Part B. Part D plans are offered by Medicare-approved private insurance companies. The cost of each Part D plan differs based on the cost of premiums, the cost of drugs, and the list of covered drugs (formulary). If you decide not to join a Part D plan when you’re first eligible, or decide not to join a Part C (like an HMO or PPO) or other Medicare health plan that offers prescription drug coverage, you’ll likely pay a late enrollment penalty. If your Part C plan includes prescription drug coverage and you join a Part D plan, you’ll be disenrolled from your Part C plan and returned to Original Medicare (Part A and Part B).
For more information about Part D please visit our Medicare Part D Page here.