If you are like many people, once you turned 64 you started receiving a lot of extra mail in your mailbox trying to sell you different Medicare Supplement or Medicare Advantage Plans. These mailers can be confusing and can certainly create information overload. They often list many different plans but fail to explain them. Few offer advice on what you should do as you approach age 65 and become Medicare eligible. So what should you do as you turn 65?
The first thing to know is you have to sign up for Original Medicare. Everyone who is turning 65 has a 7-month window during which they can sign up for Medicare. It begins three months before you turn 65 and lasts for three months after.
During this time, you can sign up for Original Medicare, which includes Medicare Part A (Hospital coverage) and Part B (Medical coverage). In addition, you may choose to sign up for Part C (Medicare Advantage) or Part D (prescription drug coverage).
To sign up for Parts A and B, you need to contact Social Security. If you are already receiving Social Security benefits, you might automatically be signed up for Medicare. They will send you your card three to four months before you turn 65. If you do not receive your Medicare card, you should contact Social Security.
If you are not already collecting Social Security, you can sign up at a local office, call them or you may apply online at https://secure.ssa.gov/iClaim/rib . If you do not sign up for Part B during your seven-month Initial Enrollment Period, you may be penalized when you sign up for it later.
Once you have your Medicare card, you will have Medicare Part A, which provides inpatient hospital coverage, as well as Part B, which provides coverage for doctors and outpatient services. Part A usually does not have a premium. Part B has a monthly premium which currently averages $121.80.
You may be eligible for extra financial help to pay for your Medicare premiums. Contact Social Security to find out if you qualify. Original Medicare is run by the government and does not include prescription drug coverage. It generally covers 80% of your Part B medical costs, and may have daily limits and copayments within your Part A coverage.
Many people choose to add a Medicare Supplement plan and a Part D plan to help with these coverage gaps. Medicare Supplement plans can be purchased from private companies and are designed to work with Original Medicare. This means that you can go to any provider that accepts Medicare and, depending on the plan you choose, the supplement plan will pay for the 20% coinsurance expenses. It is important to know that if Medicare does not cover a service, the Supplement plan will not cover it as well and you will be responsible for the full cost of that service. (To determine if something is covered by Medicare, you should always ask your provider. Medicare generally covers services which are deemed to be medically necessary.)
Some people will choose to get a Medicare Advantage plan (Part C), instead of a Medicare Supplement plan. These are plans run by private companies which are contracted with the government. Advantage plans take the place of Original Medicare and must cover everything Medicare covers. They may cover it in a different way.
Advantage plans are usually HMOs or PPOs and have networks of doctors you can use. Depending on the plan you choose, you may have copays, coinsurance costs and deductibles. These plans may include prescription drug coverage and are known as MAPD plans. You would not need a standalone drug plan if you have an MAPD plan.
Plan availability and pricing can vary based on your primary residence zip code and county. When deciding on what to do as you turn 65, it is important to know that your choices include having either Original Medicare with a Supplement plan, or just an Advantage plan. No one can make your decision for you. You can talk to your family, friends and AMAC’s knowledgeable professionals to gather information, but in the end, only you can decide which plan is best for you and your needs.
- You may choose to change your Medicare Supplement insurance policy at any time. Many people wait to do so until the end of the year because they mistakenly believe they have to wait. This often leads to paying higher premiums longer than necessary. Only those with Part D and Part C policies have to wait to make changes until the Annual Enrollment Period, which is October 15 through December 7. People with Medicare Supplements do not have to wait.
- When shopping for a new plan, it is important to know which plan you already have. Medicare Supplement plans are standardized. All companies offering a particular letter plan (e.g., Plan F) offer the same coverage as other companies offering that same letter plan. This way it is easy to comparison shop if you are happy with your current coverage but just want a lower premium. The coverage will be the same – just with a different company and with a different premium.
- You will be subject to medical underwriting. This means that companies will look at your medical history, and based of your history, the new company may decide whether or not to issue you a new policy. Do not be afraid to try and switch plans if you have had health issues. In many cases, companies will only look back a few years, and other companies may be willing to accept people who present higher risks.
- Know your state’s guidelines. Some states, called guarantee issue states, do not permit companies to underwrite. If you live in one of these states, you will not have to worry about being underwritten. Other states provide a small timeframe each year during which you can switch your policy without any health questions. This timeframe is usually around a person’s birthday or their policy anniversary. This gives people a chance to adjust their coverage and try to find lower premiums.
- There are 10 different supplement plans which can be offered. It is important to research what coverage you are looking for. Many states offer counseling to people who are on Medicare, to help them find plans in their area. You can also call AMAC’s Licensed Medicare Supplement Advisors. They are able to answer any questions you might have about Medicare Supplement plans, can give you quotes and will help you switch plans.
 If you have creditable coverage through an employer or union, you can delay signing up for Part B. You should speak with a Human Resource or Benefits Manager.