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Medicare is federal health insurance, open to anyone aged 65 and older. It covers doctor's visits and some medication, and for many older adults, the coverage can help reduce their medical bills as they age. Although Medicare is a federally funded insurance program, it's up to each state to administer its own individual program. So, qualifications for treatment and specific coverage may vary from state to state. If you move, it's important to familiarize yourself with any changes to your Medicare coverage that you'll have in your new home.
Traditional Medicare is comprised of two parts, Part A and Part B. People may also purchase additional Medicare insurance plans, called Supplemental Medicare, that cover things that Part A and Part B don't, such as vision, dental care, or specific types of situations. A qualified insurance agent may be able to help you evaluate each plan and decide which one is best for your needs.
Medicare Part A is also known as hospital insurance and covers:
Medicare Part B is medical insurance and covers:
Some people also enroll in Medicare Part D, which is prescription drug coverage.
Most people receive Medicare Part A premium-free. However, there is a premium for Part B coverage. Part B premiums are based on your income and are higher if your annual income is higher. The starting premium price in 2022 was $10, and the highest monthly premium for people making over $5,000 per year was $538.
People who receive Social Security will automatically have their Part B coverage deducted from their Social Security check each month. And, those who receive benefits from the Office of Personnel Management or the Railroad Retirement Board will also have their Medicare costs deducted from their benefit check.
If you don't enroll in Medicare Part D during your initial open enrollment eligibility period, then you may be subject to a late fee penalty when you do enroll. The cost of the penalty is determined by how late you enroll and how long you went without Part D coverage and is added to your bill each month.
Some people may still be working at 65 and may be covered under their employer's health care plan. If you or your spouse receive coverage for yourselves through an employer-sponsored health plan, then you may not need to enroll in Medicare right when you turn 65. You may be able to wait to sign up until you or your spouse stop working or you lose health insurance coverage, whichever will come first. How you receive your health insurance determines when and if you need to sign up for Medicare right away.
If you're self-employed or have different health insurance that isn't available to everyone at your company, then you may need to sign up for Part B when you turn 65 to avoid a late penalty. If you receive COBRA health insurance coverage, then you'll need to sign up for Medicare when you turn 65 to avoid gaps in your coverage.
Medicare will cover treatment and stays in a skilled nursing facility or nursing home, but it doesn't cover other types of long-term care, such as a retirement home. However, many states offer a Medicare Waiver, which can be used for assisted living accommodations. Each state has different stipulations for the program, but in general, people may be eligible for the Waiver if they require a nursing home level of care, but prefer to live in an assisted living facility, instead of a nursing home.
Do you need help determining what kind of Medicare plan is right for you? Working with a professional advisor can help. The terms of each plan can be confusing, and it's important to enroll in the right plan for your needs. If you have questions about your Medicare coverage or need to change your coverage, we can help.