Understanding Medicare

Image that reads Medicare and YouMedicare is complex, with lots of parts, costs and benefits, coverage options, and rules. HICAP can help you understand when to enroll, what your options are, how it all works, and what makes sense for you. There are four parts of Medicare as well as two main paths to getting coverage, as explained below.

HICAP holds monthly Welcome to Medicare classes around the County.  HICAP also offers free, confidential one-on-one counseling at sites throughout the county. Counseling Locations.

Help is also available on the Medicare website, www.medicare.gov, as well as in Medicare’s publication “Medicare & You.”

Medicare is  health insurance  for citizens or legal residents (typically green card holders who have lived here for the past five years) and are at least 65 years of age.  It is also for those who have been on Social Security Disability (SSDI) for 25 months, or those with End Stage Renal Disease (ESRD) or ALS. Enrollment in Medicare is done through the Social Security Administration.

If you miss your  Initial Enrollment Period  you may be eligible for a  Special Enrollment Period  if you or your spouse are still working and have group insurance. (Be careful, the rules are complex!) Otherwise you can sign up during the  General Enrollment Period  during the first quarter of each year.  In that case coverage begins the following July, and you may also be subject to a permanent late enrollment penalty. Enrollment rules can be complicated, and timing is very important. See HICAP before you turn 65! Go here to learn more about the Part B late enrollment penalty.

The Four Parts of Medicare

Graphic illustrating the four parts of Medicare

Each part of Medicare has its own premiums, coinsurance and/or copayments. Parts A and B are administered directly by the Center for Medicare and Medicaid Services (CMS) and are known as Original Medicare. They operate under a Fee-for-Service care model.

Part D, which is optional but recommended, conforms to standards set forth by CMS but is sold by private insurance companies. It can be purchased in conjunction with either Parts A or B through stand-alone prescription drug plans.  Alternatively, Part D coverage is usually included in Medicare Advantage plans, described below.

Original Medicare can also be supplemented with private insurance plans or Medicare Supplements.  These are usually called Medigap policies, since they are designed to pay the portion of covered medical costs not paid by Original Medicare (the gaps.) These policies help with deductibles and cost sharing that you’re otherwise responsible for paying under Parts A and B.

Go here  to find out more about the premiums and coinsurance/copays under Original Medicare Parts A and B.

Alternatively, you can opt to receive your Medicare coverage another way, which is through Part C, more commonly known as Medicare Advantage plans.  These are plans also sold by private insurance companies according to standards set forth by Medicare. These plans assume all responsibility for your medical care and follow a Managed Care model. They tend to be HMOs or PPOs. You must follow the plan’s rules and generally can’t use your Original Medicare card outside the plan’s network. Each Advantage plan has its own deductibles and copays.

Go here  to learn more about the currently-available Medicare plans in Contra Costa County, including Medigap plans, Medicare Advantage Plans and stand-alone Prescription Drug plans under Part D.

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The Two Paths of Medicare
Decide how to get Medicare Coverage

A key decision you have to make when you start Medicare is how you want to get your coverage. There are two different paths, Original Medicare Parts A and B with optional Part D and an optional Medigap supplement, or Medicare Advantage.

You are generally locked into one path or the other for at least a year, with limited ability to change. Each option has pros and cons and it’s important to understand them before you decide. What is best for you depends on many factors such as your medical needs, expected usage and your financial situation.

If you have coverage through your employer, union, retiree plan or Veteran’s Administration you need to carefully understand how it works with Medicare. All plans are different.  Some coordinate with Medicare and others don’t. Also there are rules governing which coverage is primary and which is secondary depending on your employment status and the size of the employer. HICAP can help you understand the rules and analyze your options.

 

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