Medicare is a federally funded health insurance program that covers:

• People turning 65 and older.
• Those with End-Stage Renal Disease, which is kidney failure that requires dialysis or a transplant.
• Some people under 65 with certain disabilities.
• Beneficiaries must be a U.S. citizen or legal resident for five continuous years.

There are four parts of Medicare, each covers a specific service.

• Part A provides inpatient/hospital coverage.
• Part B provides outpatient/medical coverage.
• Part C offers an alternate way to receive your Medicare benefits.
• Part D provides prescription drug coverage.

Medicare Advantage Plans are a type of Medicare health plan offered by private companies that contract with Medicare. To be eligible for Medicare Advantage/Part C coverage you must have both Parts A and B.

With Medicare Part C:

• Monthly premiums vary by plan
• Annual deductible and maximum out of pocket
• Combines Part A and B coverage
• Usually includes drug coverage

Original Medicare is a health plan that has two parts: Part A (Hospital Insurance) and Part B (Medical Insurance). 

Original Medicare Part A helps cover:

• Inpatient care in hospitals
• Skilled nursing facility care
• Hospice care
• Home health care

Original Medicare Part B helps cover:

• Services from doctors and other health care providers
• Outpatient care
• Home health care
• Durable medical equipment (wheelchairs, hospital beds, etc.)
• Many preventative services (screenings, vaccines, etc.)

Medigap is Medicare Supplement Insurance that helps to fill “gaps” in Original Medicare. Medicare Supplement/Medigap policies impose no hospital or medical network restrictions and do not replace Medicare. Instead, Medicare Supplements work alongside Original Medicare and pay the cost that remains after Original Medicare has paid, in accordance with the plan documents. 

A Medicare Supplement Insurance/Medigap policy can help pay some of the remaining health care costs, like:

• Deductibles – ex. Part A/Hospital Deductible.
• Copayments – ex. Emergency Room and Medical Doctor Copays.
• Coinsurance – ex. Part B 20% Coinsurance.
• Excess Charges – ex. Part B Excess Charges.

You are eligible for Medicare upon turning 65 during the Initial Enrollment Period, however, when you enroll depends on if you plan to continue to work past your 65th birthday and if you still have health insurance from your employer.

If you plan to retire prior to your 65th birthday, you have a 7-month window to enroll in Part A. The enrollment period begins three months before the month you turn 65 and ends three months after your birthday month. After the seventh month, a late enrollment penalty may apply.

If you plan to keep working past 65, are working for a company with 20 or more full-time employees, AND you are covered through their group health insurance, you may not need all parts of Medicare when you turn 65.

You can sign up for Part A (which is free for most people who have worked at least 10 years) and delay premium-based Part B and/or Part D without incurring a penalty and sign up for Parts B and D later when you retire or lose your job-related insurance. When you do retire, you will have a special election period to sign up for Parts B and D penalty free.

If you are planning to keep your employer’s coverage, you’ll want to compare those cost and benefits against Medicare to decide which is the most cost effective.

When you enroll in Medicare Part A and/or Part B, you can no longer contribute pre-tax dollars to your HSA. However, if you have an existing HSA, you can use it tax-free for many of the qualified services listed, as long as you still have a balance in your account.

• October 15 to December 7 – Open Enrollment Period: OEP/AEP is the time period in which Medicare beneficiaries can make changes to their Medicare Advantage and Medicare Part D plans for the coming year.
• December 8 to November 30 – Five-Star Special Enrollment: During this time, Medicare beneficiaries can update to a plan with a “5-star” quality rating.
• January 1 to March 31 – General Enrollment Period: This time period is for beneficiaries who didn’t sign up when they were first eligible. 
• January 1 to March 31 – Medicare Advantage Open Enrollment Period: Beneficiaries who already have Medicare Advantage can go switch to Original Medicare or a different plan.
• First year of Advantage coverage – If a beneficiary is dissatisfied with their Medicare Advantage plan, it’s possible to switch back to Original Medicare and buy a Medicare Supplement insurance plan without medical underwriting