Birthdays are certainly a cause for celebration (and a big slice of cake)! Your 65th birthday and Medicare will likely go hand in hand, so now is the perfect time to take stock of your health care needs. One of the most important things to know about Medicare is your Medicare coverage choices. We understand preparation is key and it can be overwhelming! To help you tackle the process, we’ve compiled a range of Medicare options so you can confidently compare, plan, and protect yourself as you enter your golden years.
Original Medicare has two parts: Medicare Part A and Part B. Let’s take a look at five of Original Medicare’s standout features to consider:1
Medicare Part A is your hospital insurance. This portion helps cover inpatient hospital care, hospice care, home health care, and skilled nursing facility care. If you or your spouse paid Medicare taxes long enough while working (typically at least 10 years), you’ll likely qualify for premium-free Part A. It’s easy to find these details out; just create a my Social Security account, and you’ll be in the know!
Medicare Part B is your medical insurance and helps cover your medical needs, including doctor’s visits, durable medical equipment, preventive services like wellness screenings and vaccines, and outpatient care. Anyone eligible for Medicare Part A can enroll in Part B. Medicare Part B does have a monthly premium (the 2023 monthly cost is $164.90).
Pro Tip: Mark your calendar! Your initial Medicare enrollment period lasts seven months, beginning three months before you turn 65 and ending three months after the month you turn 65.2
Medicare Advantage, also known as Medicare Part C or MA, is an alternative to Original Medicare. A Medicare Advantage plan might be an excellent choice to explore if you’re a fan of bundling. Medicare Part C plans include Part A and Part B. Many Medicare Advantage plans also include a Part D drug plan and other benefits.
Just like we did with Original Medicare, let’s review five significant details to keep in mind when shopping for a Medicare Advantage plan:
Good to Know: Each year, the Centers for Medicare and Medicaid Services (CMS) issues star ratings to all Medicare Advantage plans. Plans are rated on a scale of 1 to 5, with one star being the lowest and a five-star rating being the highest. Use Medicare’s plan finder tool to view the latest star ratings.
Many Medicare enrollees are surprised to find that Original Medicare doesn’t cover everything. This is where an optional Medigap plan comes into play. Medigap, also known as Medicare Supplement Insurance, helps fill in some of the gaps in Original Medicare. In most states, Medigap plans are labeled by letter. Once you turn 65, you’ll have access to eight Medigap plans. Take time to review what each Medigap plan covers (for example, Medigap Plan G covers 100 percent of your Part A deductible, while Plan M only covers 50 percent).
Medigap plans are federally standardized, which means the benefits of each plan will be the same no matter which insurance company you choose. These plans are sold by private insurance carriers, so pricing and availability will vary. It’s important to note that you cannot have both a Medigap and a Medicare Advantage plan. Our Medigap vs. Medicare Advantage guide breaks down the pros and cons of both policies so you can figure out which is best for you.
As we mentioned earlier, Original Medicare doesn’t include drug coverage. For most, paying for prescriptions out of pocket isn’t an option, especially for older adults and other beneficiaries taking multiple medications. According to a study by Kaiser Family Foundation, more than half of adults 65 and older report they are currently taking four or more prescription drugs.3 Luckily, prescription drug coverage is available through Medicare Part D.
If you enroll in Original Medicare, you have the choice to enroll in a separate Medicare Part D plan. If you decide to go the Medicare Advantage route, many Medicare Advantage plans include drug coverage. Medicare Part D plans are run by private insurance companies, so be sure to shop around for the best price.
FYI: For the inside scoop on Medicare Part D enrollment, coverage, and cost, head over to our Medicare Part D guide.
Before you turn 65, think about the medications you take now and may need in the future. You may suffer costly consequences if you don’t enroll in a Part D plan (through Original Medicare or Medicare Advantage) when you’re first eligible. Medicare charges a late-enrollment penalty, which you pay for as long as you have Medicare drug coverage.4
Be sure to make the most of your Medicare benefits! Our editor-in-chief, Jeff Hoyt, shares important things to know about Medicare in 2023 so you maximize your coverage.
Turning 65 is an exciting time! Retirement may be just around the corner, or you may be planning to work for a while. Either way, Medicare plays a crucial role in this birthday milestone. Armed with Medicare coverage options, you have the power to decide what best meets your whole health needs.