What You Need to Know About Medicare and How to Sign Up

*Updated April 2020

If you’re nearing age 65, you’ve no doubt been bombarded with mailers from various insurance companies trying to convince you that their Medicare options are the best. The problem with many of these advertisements is that the companies sending them have never met you nor do they have any insights into your health history or personal situation.

Many people, especially those who’ve had employer-sponsored healthcare, have relied on others to guide them in their health coverage decisions and simply don’t understand the many complexities of choosing the right Medicare coverage for their unique circumstances.  Everyone is different. We’ll help you filter through the noise (and that pile of mail) and answer your most pressing questions.

When do I sign up for Medicare?

Everyone who reaches age 65 is eligible for Medicare, and there are specific timeframes for registering. Enrollment begins three months prior to the month you turn 65 and ends three months after the month you turn 65 — essentially a seven month window. It’s important to start planning sooner than later so you’re prepared. Delays or mistakes during the enrollment period could result in a gap where you’re not covered under insurance.

How do I sign up for Medicare?

Medicare is a broad term and the plans contained within it are not one-size-fits-all. What may work well for a friend or neighbor may not be right for your personal healthcare needs. That said, there are many great options to choose from, and many ways a person can sign up for a plan.

A first step is to check with your independent insurance agent who helped you obtain home and auto coverage to see if he or she can also help you sift through your Medicare options. Many provide this service. During your conversation, you’ll likely cover the following options:

Original Medicare — There are two options available within this base program.

• Medicare Part A. If you’ve worked the equivalent of 10 years or more, then you’ve likely already paid for your Part A premiums as part of your income taxes. This means you won’t pay a monthly premium for Part A coverage, which covers hospital stays, care in a nursing facility, hospice care and some other health care. Typically, people should enroll in Part A immediately at age 65.
• Medicare Part B. Certain doctors’ services, outpatient care, medical supplies and preventative healthcare measures are typically covered under Part B. There is a monthly premium for this coverage, and how much you pay is determined by your income. You can choose to delay enrolling in Part B depending on your situation, particularly if you are still working and covered under an employer health plan.

Medicare Part D — This is a standalone policy that can be added to your Original Medicare plan or other plans for an additional premium to help cover the costs of prescription drugs.

Medicare Advantage — This is also known as Medicare Part C and is considered a more customized plan that conveniently bundles various coverage options together. For example, it automatically includes Part D and may also include other services not covered by Original Medicare such as vision, dental, and hearing services. Premiums are typically quite low, but you will be required to pay out-of-pocket expenses including co-payments and coinsurance.

There are several nuances within each plan and several other supplements and considerations as well. Signing up on your own is possible, but there’s something to be said about the peace of mind offered when working with someone who can help you know which plans are right for you and is familiar with the ins and outs of Medicare.

How do I know which Medicare plan to choose?

Your agent should make recommendations on which direction you should consider only after exploring what you anticipate your needs will be going forward. Here are the major questions you’ll need to ask yourself and discuss with your agent prior to choosing a plan.

Do I take prescription drugs?

Prescription drug costs can be astronomical and often make up the bulk of plan premiums. This is particularly true if individuals take brand name drugs that need to be administered indefinitely, such as heart medications, insulin, pulmonary inhalers, etc.

Your insurance agent will ask about prescriptions you take to help determine how those costs can be covered or minimized under Medicare. Each insurance company that’s authorized to provide Medicare coverage is required to cover most drug classifications, but not every drug within those classifications may be covered, and they can add or eliminate certain drug coverage from year to year. This stresses the importance of reviewing your plan during the annual election period to determine if there are any changes or if you need to have a conversation with your physician about using alternative drugs. If that’s not a possibility, then you’ll likely need to explore other plan options. Other considerations include whether you have specific conditions that might need to be covered down the road, such as a joint replacement or other procedures.

Do I have preferred healthcare providers?

If you’ve formed a trusting relationship with your physician or other healthcare providers and want to ensure you can still rely on their care, make sure the plan you choose includes them in their network. Advantage plans often require a specific network, so you’ll need to determine which plans include your preferred providers or remain flexible regarding your choice of doctors.

Do I plan on traveling in retirement?

If you plan on exploring the world or spending winters in a warmer climate, you need to understand what Medicare will and will not cover should an emergency or medical need arise.

When traveling or staying outside your home state, in-network emergencies are typically covered, such as a trip to the emergency room. Follow up care, however, may not be covered and your plan may require that any further out-patient care be done in your home state. Some supplement plans are available to provide coverage for out-of-state doctor visits, so it’s important to discuss your lifestyle needs and expected travel plans with your insurance provider.

What is my budget?

If you’ve been on an employer-sponsored health plan, you know that costs have skyrocketed in recent years. Some assume that having to be fully responsible for Medicare healthcare premiums on their own will be impossible. Most often, however, Medicare is significantly less than the portion you may have paid in the private sector.

As mentioned, there is typically no premium for Part A if you’ve worked more than 10 years, and the standard Part B premium for most individuals is only $144.60 each month. While various plans can be added, the final cost is usually quite affordable. A Medicare Advantage plan is usually significantly lower than Original Medicare — as low as $0 per month — but additional copayments and coinsurance may need to be considered. Work with your agent to find a plan that works within your budget.

Do I need help?

If you’re at all uncertain about which plan is best for you, it’s best to seek the help of someone who is experienced in unraveling the complex world of Medicare and can objectively make recommendations based on what makes sense for you and your individualized needs. McClone offers comprehensive Medicare services and can help clear the confusion. Reach out today to start the conversation.