Medicare: what happens when your health insurance switches to Medicare?

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Like most people turning 65 you may be wondering about what happens when your health insurance switches to Medicare. Is there any paperwork I need to fill out? What plans do I have to choose from? Does Medicare pay for my prescription drugs? What about coverage for my particular medical condition?

Let’s take a look at 10 common myths about this important program.

Myth #1: People Can Enroll in Medicare Anytime

Most people become eligible for Medicare at age 65 and have a 7-month enrollment period to sign up for Part A and/or Part B. This initial enrollment period includes the three months preceding a person’s 65^th birthday, their birthday month, and the three months following their 65^th birthday. Unless a person is eligible for special enrollment, they must sign up during their initial 7-month eligibility period or wait until open enrollment, which happens each year from January 1- March 31.

Myth #2: Medicare Does Not Cover Prescription Drugs

Many of us have heard stories of elderly people struggling to pay for prescription drugs that aren’t covered by Medicare or who are forced to go without their prescriptions altogether because they simply can’t afford them. It’s true that Original Medicare (Parts A and B) covers only basic drug coverage (i.e. a limited number of outpatient prescription drugs under limited conditions). This is why Medicare Part D (prescription drug coverage) was established in 2003. Part D plans are offered through private insurance companies as standalone plans, or they can be purchased as part of a Medicare Advantage (Part C) plan. It’s important to make sure you choose a plan that covers all the prescription drugs you’re taking. Consult with a Medicare expert for help choosing the right plan. ( Call us at 716 565 1300, http://www.MintcoFinancial.com

Myth #3: Medicare Covers Assisted Living and Home (Custodial) Care

Medicare does not cover home care assistance for activities of daily living, such as dressing, bathing, eating, and housekeeping (referred to as custodial care), nor does it cover care in an assisted living facility. Medicare does cover some skilled nursing facility care, nursing home care, (as long as it’s not exclusively for custodial care) and some home health care services, including intermittent skilled nursing care, physical therapy, speech-language pathology services, continued occupational services, and other services, with varying conditions and restrictions.

Myth #4: Medicare and Medicaid Are the Same Thing

While the two have similar sounding names, Medicare and Medicaid are very different programs. Medicare provides health coverage for people age 65 and over as well those with end-stage renal disease (ESRD) and other conditions, while Medicaid provides health coverage for people with low incomes and few resources. Some people are eligible for both Medicare and Medicaid, but they must apply for each program separately.

Myth #5: Medicare Supplement (Medigap) Plans Cover Everything Original Medicare Covers

Medicare supplement (Medigap) plans are designed to help cover costs like copayments, deductibles, and coinsurance amounts that aren’t covered by Original Medicare (Parts A and B) or by a Medicare Advantage plan (Part C). There are a wide range of Medigap plans to choose from that vary in cost. Consult with an expert to explain all the different parts of Medicare and how they work.

Myth #6: You Can’t Get Medicare if You’ve Never Worked

Generally, a person needs 40 Social Security Administration (SSA) work credits (equivalent to around 10 years of work) in order to qualify for Medicare Part A (hospital) with no premium. This can present an issue for homemakers who have never worked. To remedy this, Medicare allows homemakers to obtain no-charge Medicare Part A based on the work record of their spouse, as long as the person is 65 or older and their spouse is at least 62. Otherwise, a person will pay $234/month in 2014 if they have 30-39 work credits, or $426 per month if they have fewer than 30 work credits. Once a person has earned 40 work credits they no longer pay a premium for part A. Parts B (medical) and D (prescription drug coverage) both have separate premiums and have nothing to do with how long you’ve worked.

Myth #7: The Affordable Care Act Made Drastic Cuts to Medicare

In fact, the opposite is true. The Affordable Care Act (ACA) prohibits cuts to Medicare benefits and aims to rein in the cost of provider payments, cut down on fraud and waste, and otherwise cut down on costs by ensuring seniors get preventive services in order to avoid chronic conditions like heart disease and high blood pressure, which are expensive to treat and reduce quality of life.

Myth #8: People Living Longer Will Bankrupt Medicare

This myth has persisted for decades as modern medicine has continued to increase life expectancy. Long term care in a nursing home, assisted living, or at home (custodial) tend to be the biggest expenses that people of advancing age incur, and none of these services are covered by Medicare. Medicare does cover hospital care, skilled nursing facility and/or nursing home care (as long as it’s not custodial), hospice care, and home health care services.

Myth #9: Medicare is Free Healthcare

Despite a common misconception, Medicare is not free. Several parts of Medicare have premiums. Here is a breakdown:

• Medicare Part A– Has no premium for those who have at least 40 work credits and/or those who qualify based on their spouse’s work record.
• Medicare Part B– Most people pay $104/month in 2014. People with incomes above $85,000/year will pay more.
• Medicare Part C (Medicare Advantage plans)- These plans take the place of Original Medicare (Parts A and B) and may or may not have an additional premium.
• Medicare Part D (prescription drug coverage)- These plans are purchased through private insurance carriers and vary in cost.
• Medicare supplements (Medigap)- These plans have an additional monthly premium that varies in cost.

Myth #10: Medicare Costs the Same Amount for Everyone

The majority of people will pay no premium for Part A, and $104/month for Part B in 2014. As mentioned earlier, some people will pay a premium for Part A based on their work history, and Medicare Parts C, D, and Medicare supplement plans all have variable premiums. Based on the plans and supplements chosen, the amount a person pays for Medicare coverages can vary considerably from one person to the next.

Navigating the world of Medicare can be confusing. Consult with a Medicare expert at Mintco Financial , Phone: 716 565 1300 to understand all your coverage options and find the combination of plans that is right for you.

Visit www.MintcoFinancial.com