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Americans are widely aware that when they turn 65 they will have access to Medicare for their health insurance needs. What isn’t so clear is what seniors need to do to enroll and how to choose the plan(s) that are right for them. One of the things that we specialize in here at Premier Benefit Consultants is helping kupuna transition from individual or employer health coverage to Medicare insurance. In this article, we provide five steps to get ready for Medicare as you approach your 65th birthday.
5 Steps to Get Ready for Medicare
These are the five basic steps required to enroll in Medicare and ensure that you’re in a plan that suits your needs and budget.
1. Enroll in Medicare (if you haven’t already started receiving Social Security benefits)
Seniors who have opted into their social security benefits before the age of 65 will be automatically enrolled in Medicare Part A (hospital insurance) and Part B (medical insurance) in most cases. You will receive a Medicare Initial Enrollment Period (IEP) package three months before your 65th birthday and benefits begin the first day of the month you turn 65.
If you are close to age 65 and haven’t started receiving your Social Security benefits yet, you will need to sign up for Medicare Part A and Part B through the Social Security Administration, beginning three months prior to your 65th birthday. You won’t get Medicare information sent to you automatically in this scenario.
Note: If you plan to continue working past your 65th birthday and want to keep your employer’s group health coverage, we recommend talking to your benefits administrator and a local Medicare agent to help you decide when you should enroll in Medicare Part B.
2. Choose your Medicare plan
There are three main options for receiving your Medicare benefits:
1. Original Medicare (Parts A and B) plus Medicare Part D (prescription drug coverage). Note: while prescription drug coverage is technically optional, seniors face a possible late enrollment penalty if they fail to enroll in a plan during their Initial Enrollment Period. The IEP runs for seven months, starting three months prior to the individual’s 65th birthday and ending three months after the individual’s birthday.
2. Original Medicare (Parts A and B) plus Medicare Part D plus Medigap/Medicare Supplement insurance. Many seniors who choose Original Medicare enroll in a Medigap plan that helps them pay for the out-of-pocket costs that Original Medicare doesn’t cover such as co-payments, co-insurance, and deductibles. In addition, unlike Original Medicare, a Medigap policy may also cover 80% of emergency medical expenses when you travel outside the U.S.
3. Medicare Advantage plan (Part C). Medicare Advantage plans are an alternate way to receive Medicare benefits. Seniors who had private health insurance may be familiar with the various types of Medicare Advantage plans, including PPO and HMO options. All Part C plans include Part A and Part B but usually also cover additional services such as vision, dental, and hearing. In addition, many Medicare Advantage plans include prescription drug benefits. Seniors who choose Medicare Advantage may not purchase Medicare Supplemental insurance.
With the help of a Medicare agent, we recommend that you compare your options to determine which is the best fit for your needs. Once that is decided it’s time to review specific plan options and enroll in your plan(s) of choice.
Note: Part D, Part C, and Medigap plans are all sold by private insurance companies, such as Premier Benefit Consultants.
3. Budget for out-of-pocket expenses
Now that you have decided on your Medicare plan(s), it’s important to budget for potential (likely) out-of-pocket expenses:
Those on Original Medicare should know that there is no annual out-of-pocket maximum, unlike Medicare Advantage.
Original Medicare does not cover vision, dental, dentures, or hearing services.
Most Medicare options come with deductibles, copays, and coinsurance.
4. Review your Medicare plan annually
Each year, Medicare beneficiaries should receive an “Annual Notice of Change” letter by the end of September that discusses any changes that are coming to their plan on January 1 of the following year. There may be changes to benefits and/or out-of-pocket costs. If your budget or medical needs have changed or you are dissatisfied with the coming changes, you should take advantage of the Annual Enrollment Period (AEP) between October 15 and December 7 when you can change your Medicare health plan and prescription drug plan. If you have a Medicare Advantage plan, you can switch back to traditional Medicare coverage or switch to a different Medicare Advantage plan.
5. Enroll in long-term care coverage
Additional insurance is required for custodial care so it’s important to review long-term care coverage options to find the right policy for your budget. This is the best way to ensure that you are covered should you need long-term care in the future.
Our independent insurance agents are dedicated to assisting people on Medicare and those who are ready to transition from employer coverage to personal retirement coverage. We help kupuna understand their benefits options and apply for additional coverage, as needed. Because we represent all the major Medicare Advantage and supplement plans in Hawaii, we are able to offer unbiased advice; all at no cost to our clients.
At PBC, our clients are our number one priority and we look forward to getting to know you and your needs. Call us today at (808) 738-4500 to see how we may be of assistance.
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