Busting Seven Medicare Myths
Myth 1 – Medicare is free health care, and costs do not change.
Medicare is not free but is partially prepaid through your taxes when working. It is a federal health insurance program for U.S. citizens and permanent residents age 65 and older, as well as younger people with certain disabilities or end-stage renal disease. Medicare has four parts that each cover different health care services:
- Part A: inpatient hospital stays, skilled nursing facilities, hospice care and home health care
- Part B: outpatient medical coverage including medically necessary services from doctors or other health care providers, some preventive care, lab tests, and certain medical supplies and equipment
- Part C (Medicare Advantage): Medicare-approved private health insurance alternative that replaces Medicare Parts A and B
- Part D: prescription drug coverage that helps pay for medications and some vaccines
- Medicare Supplement Insurance (Medigap): a Medicare-approved private health insurance supplemental plan that fills the gaps in Parts A and B coverage to help with cost-sharing expenses (i.e., copays, deductibles)
You are typically eligible for free Medicare Part A if you are age 65 or older and either you or your spouse paid Medicare payroll taxes for at least 10 years while employed. Anyone who does not qualify for free Part A will pay the full or a discounted premium each month. All other parts of Medicare – Parts B, C and D – have individual monthly premiums.
Medicare costs, coverage and premiums do change. They are evaluated and established by the federal government each year.
Myth 2 – Medicare coverage is automatic when you turn 65.
Not everyone is automatically enrolled in Medicare. Anyone who already receives Social Security or Railroad Retirement Board (RRB) benefits will automatically be enrolled into Parts A and B starting the first day of the month you turn age 65. Those who have a birthday that falls on the first of the month will have Medicare coverage start the first day of the previous month.
People with a qualifying disability are automatically enrolled into Parts A and B after receiving disability benefits from Social Security or the RRB for 24 months. If you have end-stage renal disease, you will need to contact Social Security to determine eligibility and enroll.
Anyone turning age 65 who does not receive Social Security or RRB benefits will need to enroll yourself in Medicare. There is a seven-month period to initially enroll. This period begins three months before turning age 65, plus your birthday month and the following three months.
Myth 3 – Everyone pays the same amount for Medicare.
The costs vary depending on which part of Medicare you choose. The monthly premium for Part A is dependent on the amount you or your spouse paid in Medicare payroll taxes while working.
Your income determines your Part B monthly premium. There is a standard premium for Part B that everyone must pay; however, if you have a higher income, you may have to pay higher than the standard premium for Part B. The income-related monthly adjustment amount also gets applied to your Part D premium if you have a higher income.
Everyone pays the same deductible and coinsurances for Parts A and B. The monthly premium for Part C, Part D and Medigap varies depending on the plan and private health insurance company selected.
Myth 4 – You can enroll in Medicare at any time.To avoid a lifetime penalty, you need to sign up during your initial enrollment period if you don’t have other creditable coverage. This is your seven-month eligibility timeframe when you turn age 65. Failing to enroll results in a lifetime penalty that gets higher the longer you wait to enroll. If you fail to enroll during this time, you will have to wait until you qualify for a special enrollment period or until the next general enrollment period.
A special enrollment period is when you meet the requirements to enroll in a health plan outside of open enrollment due to a qualifying life event, such as losing coverage, moving, getting married, or having or adopting a baby. The general enrollment period is the annual timeframe – from Jan. 1 to March 31 – when you can enroll in Medicare Part B for the first time.
Myth 5 – Medicare covers everything including long-term care.
Medicare does cover most basic and medically necessary health care needs. What it doesn’t cover is long-term care, routine home care services, around-the-clock care, as well as vision, dental and hearing services. Medicare will pay for short-term home care services if short-term skilled nursing care is needed to recover from an illness, injury or surgery.
Myth 6 – You get more coverage from Medigap than you would from Medicare Advantage.
Medigap is a supplemental plan option from a private health insurance company that works alongside Parts A and B to help pay certain costs not covered. This is limited to cost-sharing expenses, such as copays and deductibles.
Because Medicare Advantage plans are comprehensive plans through private health insurance companies, they offer more flexibility. There is an out-of-pocket maximum with these plans that protects you from large health care bills. Plus, your coverage benefits extend to include extras, including vision, dental and hearing services. Some plans even cover prescription drugs and fitness incentives.
Myth 7 – Once you enroll in a Medicare Advantage plan, you cannot switch.
Every year from Oct. 15 to Dec. 7, there is an open enrollment period where you can join, switch or drop your Medicare coverage. This means if you want to shift from Medicare Parts A and B to a Medicare Advantage plan or vice versa, you can at this time. During open enrollment, you can also choose to shift from one Medicare Advantage plan to another – whether that plan is from the same or a different health insurance company, depending on the options in your area.
With Medicare Advantage, you are still in the Medicare program, with Medicare rights and protections. Whichever type of plan you choose during open enrollment will go into effect beginning Jan. 1 of the following year.
Download your free guide to Medicare Advantage plans from Align powered by Sanford Health Plan today here. For more information, contact a Sanford Health Plan licensed agent at (888) 535-4831 on Monday through Friday between 8 a.m. and 5 p.m. CST, excluding holidays, to learn more.