What Is Medicare Anyway?
It’s health insurance provided by your favorite uncle, Uncle Sam, (a.k.a. The United States Government).
Uncle Sam said a few decades ago that he is going to apply a Medicare tax on every tax paying person’s paycheck. The tax helps Uncle Sam make money today, and in return he promised to help later down the road in the form of health care financial aid.
After a person works for a minimum of 10 years in the U.S. they will then qualify for his health
insurance program once they turn 65. Or if they have certain disabilities but are under the age of
65, he’ll allow them to qualify for his health insurance too.
Uncle Sam is family. We love him, but he always comes to dinner talking a mile a minute and
nothing is ever as simple as it seems with him. Same thing applies to his insurance, (a.k.a. Medicare).
It’s not as cut and dry as pay today and later health care will be FREE. Uncle Sam has A LOT of nieces and nephews (that’s us tax paying people), to fully cover everyone’s health care bills. So we still have to pay some of the cost.
Uncle Sam divided Medicare into 2 parts at first. He called them Part A and Part B.
Over the years he has added a couple more parts, and as of 2022 there are 4 parts which make up Medicare.
Part A, Part B, Part C, and Part D.
Part A- Hospital Insurance
Part A is hospital insurance. It helps with paying the costs associated with in-patient care, skilled nursing facilities, as well as hospice.
Most people pay $0 premium per month for Part A. This is because they paid up front by way of taxes to Uncle Sam.
A spouse may receive Part A through their current or ex-spouse’s work history. He also allows anyone who didn’t pre-pay by way of tax for at least 10 years of work, an opportunity to get Part A. They just have to pay a monthly premium for it.
Enrolling into Part A happens automatically if you are already receiving Social Security benefits. You will get your Medicare card sent to you in the mail a few months before your 65th birthday.
If you are not receiving social security benefits by age 65, then you have to enroll yourself. The easiest way is online at the Social Security website, ssa.gov
**If you are the forgetful type, don’t fret, before you turn 65 you will receive so much mail about Medicare and how/when to enroll you’ll start wondering which killed more trees, your Medicare mail or CVS receipts.**
If you already have coverage through let’s say an employer, you can delay enrolling in Part
A, but it’s wise to enroll in Part A once you become eligible for secondary hospital coverage.
You don’t have to, but most people do.
Part B- Doctor Insurance
Part B is medical services. Think doctors. Part B covers things like wellness visits, flu shots, vaccines, doctor visits, and medical devices used in home like a wheelchair or walker.
Part B is optional, and because there is a monthly premium for Part B, folks sometimes don’t want to enroll in Part B, because they say they never go to the doctor. People in general do not like bills, and Uncle Sam knows this. Therefore, you are going to want to make sure you have creditable coverage somewhere else, like work. Otherwise, you’ll be out of pocket for those doctor bills.
Just like with Part A, you can delay enrolling in Part B, but again, this is only recommended if you have creditable coverage through another source, like an employer. You will also not be allowed to
enroll in any supplemental coverage without Part B coverage. Uncle Sam needs to be paid first before he allows that.
Enrolling in Part B is the same as Part A. If you are already receiving social security, then you
will automatically be enrolled. If not receiving social security then you have to actively enroll
either at a local office, by phone, or online.
Part D- Prescription Drugs
We are going to skip the alphabet and talk about Part D now. You’ll see why I skipped C in a
moment.
Part D is prescription drug insurance. Part D was introduced in 2006, and like Part B, Part D is optional. If a person has Part D coverage, then they will receive a discount on prescription drug costs which can be expensive without Part D.
Unlike Parts A and B, you do not go to Social Security to sign up for D, but rather these plans are offered by private insurance companies. (Think United Healthcare, Wellcare, Humana, Aetna, etc.)
Each insurance company has to follow guidelines that Uncle Sam set, but they are allowed to
set the price they charge you for the plan. They also are allowed to create their own list of drugs
covered and not covered. In addition, these plans vary not only by state, but also by county.
Example:
Let’s say your cousin has Plan X from Carrier X, and lives in Manassas, Virginia. He tells you it’s great and the cost is $7 a month. That does not mean that you, who lives in Long Beach, California will have the same exact coverage or cost per month even if you choose the same carrier and same plan.**
Part C- Medicare Advantage
Now let’s go back to Part C. Uncle Sam
started with creating Parts A and B. Then over time, he decided to add Part D. Eventually, he thought it’d be easier to just have everything all under the same roof. Which is Part C,
it’s also known as Medicare Advantage and most plans also include Part D so those are called Medicare Advantage Prescription Drug plans. Or MAPD for short.
MAPD plans are offered by private insurance companies, (think United Healthcare, Wellcare, Aetna, Humana, SCAN, Blue Cross, Cigna, etc.) The plans are packaged with Parts A, B, and D, and are meant to be like an all-inclusive package.
Once enrolled in a MAPD, you will receive an insurance card from the carrier and that is the card you use at the doctor’s office, hospital and pharmacy. 1 plan, 1 card. Easy.
Each MAPD plan offers different benefits based on the county the plan is in. To enroll in a MAPD, you MUST HAVE both Parts A and B. The reason these are so popular is because many if not most plans have a $0 per month premium, but also offer additional benefits to members.
Additional benefits such as:
- Hearing, vision, and dental coverage
- $0 fitness & gym memberships
- $0 transportation
- Part B premium Giveback.
- Credits to purchase over-the-counter items at CVS
Need assistance? Have questions? Not sure which plan to choose? We are happy to help!
