Many Americans are worried about the healthcare expenses they're facing now, or ones they may face in the future. Medicare coverage is a huge help to many -- more than 50 million enrollees recently, to be specific. If you're a Baby Boomer with Medicare around the corner, there's a lot you need to understand about it. Here are nine important things to know.
It's important to enroll on time
Enrollment in Medicare is automatic for some people (those who are already receiving Social Security benefits at age 65), but not for all. Enrolling on time matters a lot, because those who enroll late risk having to pay more for it for the rest of their lives -- as some of the premiums may rise by 10% for each year that you were eligible for Medicare but didn't enroll.
You're eligible for Medicare at age 65 and can sign up anytime within the three months leading up to your 65th birthday, during the month of your birthday, or within the three months that follow. Enrolling via the Medicare website at www.medicare.gov should take most people 10 minutes or less. You can also enroll by calling 800-772-1213, or visiting a Social Security office about three months before your 65th birthday.
You'll need to understand the alphabet soup
The main components of Medicare are referred to as Parts A, B, C, and D. Parts A and B, respectively covering hospital expenses and medical expenses, make up what is now often referred to as traditional or "original" Medicare. That's because you can opt for Part C instead of A plus B -- with Part C being a Medicare Advantage plan. Part D, meanwhile, offers prescription drug coverage, including insulin supplies.
Medicare covers a lot
Part A covers hospital inpatient care, skilled nursing facility care, and some home healthcare and hospice care. Part B covers physicians' services, service from other healthcare providers, certain therapies, lab tests, home healthcare, durable medical equipment (such as blood sugar monitors, wheelchairs, or crutches), and some preventive services such as screenings and vaccines. Lots of other items or treatments are covered -- some only under certain conditions -- such as artificial limbs, ambulance services, hospice care, mental healthcare, and transplants.
Medicare doesn't cover everything
Medicare is great, but it probably won't cover everything you want it to. For example, it generally doesn't cover vision, hearing, or dental expenses, as well as basic home health help, such as assistance with bathing or toileting -- unless you're also receiving skilled nursing care. Alternative medicines or treatments (such as acupuncture, acupressure, homeopathy, or chiropractic care) are generally not covered. Care you receive while outside the U.S. is not covered, either.
When it comes to Part D, lots of prescription drugs are covered, but not all. Weight-loss pills, erectile dysfunction treatments, fertility drugs, and over-the-counter medicines are among those not covered.
Medicare isn't free
Medicare offers a lot of coverage, but it isn't free. Part A is free for most people, but it carries a deductible ($1,288 for 2016) -- and it's not a simple annual deductible, either. Instead, it applies per "benefit period," with a benefit period beginning when you are admitted to a hospital or skilled nursing facility and ending once you've not received inpatient care for 60 consecutive days. Thus, if you are in and out of hospitals frequently, you may have to pay that deductible several times in a single year.
Part B, meanwhile, charges monthly premiums -- which are $104.90 for most folks in 2016. Premiums and costs for Parts C and D vary widely. As of 2010, the average out-of-pocket spending on Medicare for beneficiaries was $4,734 for premiums and services.
You can get greater coverage via Medigap
Many retirees with original Medicare choose to buy "Medicare Supplement Insurance," commonly referred to as Medigap. It can help pay for more of your medical expenses, and can cover more things, too, such as healthcare received abroad.
Medicare serves some people younger than 65, too
It's worth noting that you don't always have to be 65 or older to qualify for Medicare. The program is also available to younger folks who are disabled or have certain conditions, such as end-stage kidney disease.
A Medicare Advantage plan might serve you best
Know that you get to choose between original Medicare (Part A plus Part B) or Medicare Advantage plans. Medicare Advantage plans are offered by private insurers, but are regulated by the U.S. government. They're required to offer at least as much coverage as original Medicare, and most offer more than that, often including prescription drug coverage and perhaps dental, vision, and/or hearing coverage. Study your options closely to determine which plan will serve you best.
For example, while original Medicare will give you access to doctors all over the U.S., it doesn't cover healthcare provided abroad. Some Medicare Advantage plans do cover treatments abroad, but Medicare Advantage plans tend to be limited to a local network of healthcare providers (though some of the networks are large). With original Medicare, you'll often pay 20% of many bills and your total out-of-pocket costs could be very high, while all Medicare Advantage plans have out-of-pocket limits, beyond which the plan will pick up all your healthcare costs for the year.
It's smart to make the most of Medicare
For best health results, plan to make the most of what Medicare offers. It entitles you to a free wellness visit with your doctor once a year, so be sure to schedule that. Many important screenings are also free for enrollees. These include mammograms and Pap tests, along with screenings for heart disease, colorectal cancer, prostate cancer, depression, glaucoma, hepatitis C, alcohol misuse, HIV, STDs, diabetes, and osteoporosis. Take advantage of all the preventive care you can, as it can keep you living longer and paying less for healthcare, too.
The more you know about Medicare, the more likely you'll be to get the coverage that suits you best. You can learn much more and view all the plans available to you at the www.medicare.gov website.