As we enter retirement age, it is important to note that medical costs will be one of the single biggest strains to our financial stability. Fortunately, Medicare can be of great relief to Seniors who are approaching retirement. However, Medicare does not cover everything. There are several things that Medicare does not cover. All of which will fall on you to pay for out of pocket. It is critically important for you to fully understand what medicare does/does not cover so you can pick the right Medigap plans that fits your needs.
What is Medicare?
On July 30, 1965, in Independence, MO, President Lyndon B. Johnson signed into law legislation that established the Medicare and Medicaid programs. Originally created for access to those who could not gain access to medical insurance, it has now transformed the nation’s health care system over the past 5 decades. Medicare is great for our seniors because it offers a broad range of medical coverage at little to no cost.
When are you eligible for Medicare?
- You are over 65 years old
- You are under 65 with certain disabilities
- You or your spouse paid Security Taxes for at least 10 years
- You are a permanent resident of the U.S. or a legal citizen who lived in the U.S. for at least 5 years
Before enrolling in a Medicare Supplement Insurance plan, you have to be covered under both parts of Original Medicare: Medicare Part A and B.
Medicare Part A
Part A is completely free and helps you pay for:
- Inpatient care in hospitals and skilled nursing facilities
- Hospice and some home health services
Medicare Part B
Part B is not free and helps you pay for the cost of:
- Doctors Services
- Hospital outpatient care
- Some home health services
- Some physical and occupational therapy
What Medicare Part A and B do not cover
It is very important to understand what medicare A and B do not cover before you choose a Medigap plan. Medigap plans are offered by private insurers and will help you pay for things like coinsurance, copays, or deductibles. Here is a list of exactly what is Medicare does not cover:
What Medicare does not cover:
- Deductibles, coinsurance, and copayments
- Most dental care
- Eye examinations related to prescribing glasses
- Dentures
- Cosmetic Surgery
- Acupuncture
- Hearing aids and exams for fitting them
- Long-Term care (chronic illness or disability including personal care assistance)
The benefits of enrolling in a Medigap Plan
Medicare Part A and B covers 80% of your medical expenses. Unfortunately, you will be responsible for the remaining 20%. Medicare supplement plans were created by private insurers to cover that remaining 20%. Currently there are 10 standardized Medigap plans that are available in almost all states. These plans are alphabetically labelled A, B, C, D, F, G, K, L, M and N. Although created by private health insurers, rest assured, that ALL benefits are established by the federal government. Medigap plans have an open enrollment period like regular health insurance that every senior should be aware of.
When can you enroll in Medigap Insurance?
You will have a 6 month window to enroll for your medicare supplement plan. You 6 month clock starts the first day of the month in which you turn 65 and you are enrolled for Medicare Part B.
Important notice: Once this open enrollment clock starts, you can not stop it. Regardless of if you were aware of the window or not.
Important notice: Once this open enrollment clock starts, you can not stop it. Regardless of if you were aware of the window or not.
The importance for enrolling in a Medigap plan during open enrollment
Enrolling in a Medigap plan during your open enrollment window is incredibly important. If you miss your open enrollment window, an insurance company can do the following:
- Deny coverage based off of past medical history
- Increase Premiums due to past medical history
- Delay the start of coverage
Although the Affordable Care Act (ACA) makes it illegal for an insurance company to deny you coverage based off of prior medical history, or pre-existing conditions, this is not the case for a medicare supplement plan. The ACA does not apply to Medigap plans. Enrolling for a Medigap plan during Medigap open enrollment is incredibly important and has huge cost savings associated with it. As you approach your eligibility for Medicare, make sure you keep an eye on the calendar to make sure you enroll during your 6 month window.