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We thank Melinda Marshall Insurance Solutions for sponsoring this article.
Do you understand Medicare and know the “rules” of enrollment? What will cause penalties, and what will prevent them? The goal of Medicare 101 sessions provided by carriers and some Independent Agents is to give you the basics of Medicare. They do not cover plan specifics but show you the “ropes” of Medicare.
Part A: Usually, there is a $0 premium if you have worked 40 quarters throughout your lifetime. You may purchase Part A if you do not qualify for a $0 premium. Part A: Inpatient Hospitalization. Medicare pays 80% of all approved Medicare charges. For 2024: $1,632 deductible, NOT a one-time per year deductible. It is a per incident. Each incident is outside of 60 days (past each discharge).
Part B: For 2024: $174.70/mo, covering anything “Outpatient.” This premium is also based on income and will go up, but not down unless you qualify for Medicaid. Part B has a one-time per year deductible for 2024: $240 and covers 80% of approved charges.
Original Medicare does not cover dental, vision, or hearing. It only covers 80% of approved Medicare charges with a potential 15% additional fee as Medicare allows, and there is NO out-of-pocket maximum.
Late enrollment penalties last your lifetime. Do you know when you need to enroll? You do not always need to enroll at 65. If Employer Group Health Insurance covers you, your employer has more than 20 full-time employees, and the medical and prescription coverage meets Medicare’s Standard of Creditable coverage, you do not need to enroll. You have 60 days to enroll once you lose group health insurance. COBRA is not considered creditable coverage. You will pay a Part B penalty if you do not enroll within the 60 days of loss of group coverage for Part B or Part D. If you enroll in Part B and wish to keep your coverage via COBRA, you will need to enroll in an Advantage plan, not a Supplement after COBRA benefits. You must stop contributions to HSA six months before applying for Part A or Part B. You may keep HSA accounts for expenses, but you may not contribute to them.
There are two routes to cover your Medicare 20% gap. Supplemental/Medigap and Medicare Advantage. Do you know the pros and cons of Supplemental coverage vs. Advantage? Supplemental/Medigap/A-N letter plans give the freedom to go anywhere Medicare is accepted nationwide. You pay your monthly premium (which does adjust annually), Part B deductible, and nothing else. Medicare does not require referrals, and you need to purchase an additional Part D: Prescription Drug Plan (even if you do not take medications to avoid penalties later when you want to enroll). They “typically” do not have dental, vision, or hearing (there are exceptions). Some offer gym membership. Commissions on these plans are approx. 20% of the monthly premium at initial signing. Part C: Medicare Advantage (MAPD plans): you stay within a network of providers. You need referrals to specialists. You will pay copays and coinsurance and have a maximum out-of-pocket. Part B drugs have a 20% coinsurance. These plans are one-year contracts and change annually. Providers move in and out of the network throughout the year. Most often, it includes prescription drug coverage. These plans have additional perks: dental, vision, hearing, gym, over-the-counter allowances, meals following hospitalization, and more. These differ by plan and change annually. These are all the commercials and advertisements that you see. Commissions are these are approx. $750 at initial signing.
We strongly urge our clients to set up a Medicare.gov account as soon as they have their number. You will receive a bill for three months when you sign up for Medicare. You can enter your Medicare.gov account and set that up on easy pay, pay electronically, and pay monthly. If your Part B is terminated during the year for nonpayment, you will lose coverage for the remainder of the year. Your Advantage or Supplement will get canceled due to losing Part B. Enrollment cannot happen until next January, and there may be penalties for “late enrollment/losing coverage.”