What is Medicare?

Medicare is a federal health insurance program. It is for people over the age of 65, certain people under the age of 65 who receive Social Security Disability Insurance and people who have been diagnosed with End-Stage Renal Disease.

Most people are enrolled automatically in basic Medicare, but there are also certain times when you should apply if you are not automatically enrolled. You might also want to enroll in additional coverage. Medicare is offered in segments, called parts. There are Parts A,B,C and D. Each covers a certain component of your health care.

Understanding how Medicare works can be a complicated process. The following information is a good starting point for helping you to comprehend the basics of Medicare. It explains how Medicare works and which health plans are available. You will also find answers to commonly-asked questions about Medicare, as well as information on when you are automatically enrolled and when you need to apply.

How does Medicare work?

A few months before your 65th birthday, you will receive a notice in the mail as to your Medicare enrollment. In general, most individuals who have met the work requirement over their lifetime will receive Part A at no cost. The other parts – B, C and D – have associated monthly premiums that must be paid, just like any other type of insurance. Medicare is run by the Centers for Medicare & Medicaid Services.It is funded partly by Social Security and taxes for Medicare that you pay on your income, partly by the federal budget and partly through premiums paid by people with Medicare.

Once you have been enrolled in the Medicare program, there are two options for receiving your Medicare benefits. The first is from a fee-for-service program called Original Medicare, which is offered directly from the government. The plan includes Parts A and B. The second option is to obtain your benefits from a Medicare Advantage Plan, often referred to as Part C, which is a private insurance plan offered by insurance companies that have contracts with Medicare. This offers expanded coverage to include dental and vision benefits. Part D is for prescription drug costs. As with any type of purchase, if you plan to pursue Part C coverage, shop around as the premium prices can vary widely from one insurance agency to the next.

What is a Medicare health plan?

As well as Medicare Advantage Plans, there are other health plans offered by private companies that have contracts with Medicare. Those companies pay benefits to people enrolled in the Medicare plan. Types of Medicare health plans include:

  • Medicare Advantage Plans.
  • Medicare Cost Plans.
  • Programs of All-inclusive Care for the Elderly.
  • Medication Therapy Management programs.
  • Demonstrations/Pilot Programs.
  • Other Medicare health plans.

Questions You May Have

You are bound to have a lot of questions concerning Medicare. Make sure you do some research and ask for help in order to select the right course of action for you. Here are some common questions associated with Medicare, along with the helpful answers:

  • Is a referral necessary in order to see a specialist? With Original Medicare, you do not need to have a referral in most cases, although the specialist has to participate in Medicare.
  • Does Original Medicare cover prescription drugs? There are some exceptions, but most prescription drugs are not covered. However, you can enroll in a Medicare Part D plan to add prescription drugs to your coverage.
  • Does Medicare cover people who travel outside of the United States? Original Medicare does not cover health care outside of the country. However, you might be able to purchase supplemental insurance that covers traveling outside of the United States.
  • What are supplemental policies? Your employer or your union may cover costs that are not included with Medicare. If they do not, you might want to consider purchasing a Medicare Supplement Insurance policy, or look into gap coverage called Medigap.

How to Enroll in Medicare

Enrollment in Medicare is automatic for most people, although there are times when people need to apply, depending on their eligibility and when they are applying. There are also several parts of Medicare, so how you enroll depends on which parts you are applying for. To enroll in Part A or Part B of Medicare, you can apply in person at your local Social Security office or you can telephone Social Security or apply online.If you were a railroad worker, you can enroll in Medicare through theRailroad Retirement Board.

Automatic enrollment to Part A happens when you are already receiving retirement benefits from Social Security or the Railroad Retirement Board. You will automatically be enrolled in Part B, too, as long as you signed up for Medicare Part B when you signed up for retirement benefits. You will also be automatically enrolled in Part A if you are under the age of 65 and are receiving particular disability benefits, either from Social Security or the Railroad Retirement Board. You will also be automatically enrolled in Part B after two years of receiving disability benefits. The one exception is if you have been diagnosed with End-Stage Renal Disease. In that case, you will be enrolled in Original Medicare automatically at the same time your disability benefits begin.

Although automatic enrollment is usually the case, there are times where you may need to enroll yourself in Part A and/or Part B. Even if you are not receiving retirement benefits yet, if you are close to becoming 65, you are able to sign up for Part A and/or Part B during your initial enrollment period. You may wish to delay receiving your Social Security retirement benefits or your Railroad Retirement Benefits. If so, you have the option of enrolling in Medicare only and applying for your retirement benefits later. You will not be automatically enrolled in Original Medicare if you do not qualify for retirement benefits, although you are able to sign up for Part A and Part B during your initial enrollment period. The cost of your Medicare Part A, in that instance, will be dependent on how long you have been employed and whether you have paid your Medicare taxes.

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