Personal Insurance Blog

As a colleague of mine recently approached the age of 65, he realized he had to learn enough about Medicare to avoid making a bad decision. He wasn’t alone. According to AARP, more than 61 million Americans will receive Medicare benefits in 2022. I think it’s safe to say, many could use some guidance to make the right decisions regarding this valuable but complex program.

Click Here to Try our Medicare Decision Tree

Let’s start with the basics.

Medicare has Three main parts: A, B and D.

• Medicare Part A refers to payments to hospitals and similar facilities.
• Medicare Part B is for payments to doctors, physicians’ practices and similar services.
• Medicare Part D covers prescription drugs.

For additional details about Medicare costs in 2021, see the “Medicare costs at-a-glance” page at Medicare.gov.

The Medicare Enrollment Process

Unless you’re receiving benefits from Social Security or the Railroad Retirement Board, you are NOT automatically enrolled in Medicare. Enrolling is something you must do proactively.

When enrolling, the most important decision to make is whether to opt into Parts B and D. How you choose should depend on whether you work for an organization with more than 20 employees. Here’s why:

• If you continue to work for an organization with more than 20 employees, you can remain on your employer’s group health plan and delay enrollment in Medicare until you’re no longer eligible for group coverage.
• If, on the other hand, you work for a company with fewer than 20 employees or are currently enrolled in COBRA, you should sign up for Medicare Parts B and D. If you don’t sign up immediately and choose instead to wait, you’ll pay more when you do enroll.

Income level is also a key factor to consider when making your decision. The Income Related Monthly Adjustment Amount (IRMAA) will determine your monthly premium adjustments for Medicare Parts B and D.

Medicare Options When You Are Eligible

If you visited the Medicare.gov page referenced above, you may have noticed that while Medicare Parts A and B provide coverage for services, they do not cover 100% of your medical costs. There are many insurance plans that provide additional coverage, including a wide variety of plans that provide additional coverage – some even with a $0 premium.

So what’s the difference?

This diagram outlines the two paths available to Medicare enrollees.

What’s Next?

If you’re already enrolled in a plan and your circumstances have changed during the year, you have the opportunity to make changes during the annual enrollment period, each October 15-December 7.

To learn more about the basics of Medicare, including open enrollment, view the 37-minute introductory webinar I conducted this past October. If you have questions about Medicare, Life Insurance or other personal benefits,  contact Kristen Edwards at 508-742-9291.