What you should know as (or before!) you turn 65
Whether you are applying for Medicare or approaching your 65th birthday,
it’s a good idea to plan ahead. Here’s information that will help.
First-Time Medicare Applicants
You become eligible for Medicare when you turn 65 or if you have certain
disabilities or conditions that make you eligible at a younger age. Once
you’re eligible to apply, you have the choice of Original Medicare
(the fee-for-service program run by the U.S. government) or a Medicare
Advantage plan (a type of private insurance offering either an HMO or a PPO).
You can enroll in Medicare for the first time during your Initial Enrollment
Period (IEP), which is the seven-month period surrounding the month you
turn 65—three months before the month in which you turn 65, the
month of your birthday and the three months following your 65th birthday.
Here are the different plans or “parts” of Original Medicare:
Medicare Part A (Hospital Insurance)
Part A covers inpatient hospital stays, care in a skilled nursing facility,
hospice and some in-home health care. For most people, Medicare Part A
has a $0 monthly cost because of what they have paid into Social Security taxes.
Medicare Part B (Medical Insurance)
Part B covers certain doctor’s services, outpatient care, medical
supplies and preventative services. For most services, Part B covers 80%
of charges with no out-of-pocket maximum. There is a monthly cost for
Part B, and in the coming year (2019) for people new to Medicare, the
cost is $134/month. For people who have been on Medicare and have been
getting a Social Security check, this year they have been charged an average
of $110/month. High-income earners pay more than $134/month. Details can
be found on the official Medicare website, medicare.gov.
Medicare Supplement Insurance Plans
Medicare Part A and Part B are considered Original Medicare and by design
cover only select services. Also there is a high hospital copayment charge
with both. This is why consumers should consider adding a Medicare Supplement
insurance plan (also known as a Medigap plan) to help cover costs not
covered by Original Medicare.
The best time to get a Medicare Supplement plan is when you are new to
Medicare, because the premiums will be the lowest they are ever going
to be. Between age and inflation, premiums always increase over time.
When you first apply there are certain situations that require insurance
companies to sell or offer you a Medigap policy. These are called “guarantee
issue rights.” In these situations an insurance company can’t
deny you a policy or place conditions on it. These situations include
pre-existing conditions (they can’t deny you or charge you more)
and moving or travel.
Your best bet is to go to medicare.gov and/or call Torrance Memorial at
310-257-7239. This is a free, no-obligation consultation service. An advisor
with specialized Medicare training will walk you through all of your options.
Medicare Part C (Medicare Advantage Plans)
Medicare Advantage plans are offered by private insurance companies contracted
by Medicare (see below) and include HMOs and PPOs. Medicare Advantage
plans cover everything that Original Medicare Parts A and B do and usually
also offer prescription drug coverage and several options for you to choose
a medical group or an independent physician association (IPA) contracted
with them.
The upside: They offer optimal coverage for just about anything that might
arise in your life, and you can change your plan every year according
to your needs. One downside: You are typically limited to routine medical
services within the network of your IPA or medical group.
Medicare Advantage Plans require you to choose an insurance company (such
as Aetna, Anthem Blue Cross, Blue Shield of CA, Care1st, Health Net, Humana,
SCAN or AARP Medicare Complete insured through UnitedHealthcare) and a
medical group such as nonprofit Torrance Memorial IPA or DaVita
Healthcare Partners. The insurance companies, in turn, are contracted
with the IPAs, so you have plenty of choices. Torrance Memorial IPA, a division of Torrance
Memorial Health System, contracts with all eight HMO insurance companies
listed above.
Medicare Part D (Prescription drug coverage)
Part D adds benefits for drug coverage to Original Medicare Parts A and
B, and these plans are offered through private insurance companies. Note:
Many Medicare Advantage plans offer similar prescription drug coverage
included in the plan.
An experienced certified independent insurance agent can review all your
needs and make a recommendation that works best for you. For a no-cost,
no-obligation consultation, call Torrance Memorial at 310-257-7239.
A Word About Costs
“The ‘standard’ premium for Medicare Part B—basic
medical coverage—runs about $134 a month if paid monthly,”
says independent insurance agent Rose Straub. “A Medicare Advantage
HMO in Los Angeles County has no additional premium. And a top-of-the-line
Medigap Part F plan, which allows you to choose your own doctors provided
they accept Medicare, might run from $175 and up to $300. Premiums depend
upon your age and increase as you age and according to inflation. Plus
if you need a Part D prescription plan, that will add an estimated $25
per month or more depending upon the plan.”
Straub continues, “Medicare Advantage HMOs that contract with medical
groups such as Torrance Memorial IPA or DaVita Healthcare Partners have no additional
premiums in Los Angeles County—kind of the deal of the century.
There are no co-pays for hospitals or doctors, and you have unlimited
days for necessary stays in the hospital. The main caveat is that you
have to agree to work with a network of doctors that the HMO insurance
plan is contracted with.”