Health Insurance For Those Who Are 65+

Those who were born in 1951 will turn 65 this year.  For most people, that means eligibility for Medicare benefits.  Some look forward to it while others prefer to live in “denial” but it happens to everyone that is fortunate enough to reach their 65th birthday.

Medicare is a federal program that offers health insurance benefits to those who are 65 and older.  People with disabilities who are younger than 65 may also qualify.  You become eligible for Medicare on the first of the month in which your 65th birthday occurs.  You will choose whether to enroll or defer your Medicare enrollment beyond age 65.  If you continue to work and have the option of participating in an employer sponsored group health plan, you can determine whether the group plan or Medicare would be the better choice.

The Medicare law has four parts:

• Part A – also known as hospital insurance.  Part A provides benefits for inpatient services received while in a hospital, skilled nursing facility, and, in limited circumstances, at home.  Typically, you will not pay a monthly premium for Part A.  Most people enroll in Part A when they turn 65, even if they defer Part B.

• Part B – also known as medical insurance.  Part B benefits include outpatient services such as doctor visits, lab and x-ray, mental health services, durable medical equipment, therapies (physical therapy, occupational therapy, etc.) and preventive care.  There is a monthly premium for Part B.  The 2016 rate for new enrollees is $121.80 per month.  Higher income individuals will pay a higher fee.  Part B can be deferred until your participation in an employer plan ends.

Part A and Part B together are often referred to as “Original Medicare” as these were the only benefits offered when the law was passed in 1965.  Someone enrolled in Part A and Part B does not have a network of providers and hospitals that is connected to an insurance company.  You will look for a doctor or hospital that is a “participating provider” with Medicare.  Participating providers have a contract wherein they have agreed to accept assignment for all Medicare-covered services.

• Part C – also known as Medicare Advantage was added to the Medicare law in 1997.  Medicare Advantage plans are private health insurance plans that provide all of your Part A and Part B coverage.  Prescription drug benefits are frequently included.  These plans usually have networks that require you to see certain doctors or use certain hospitals.  There are several types of plans offered with different out-of-pocket costs and different rules for how you access services.  You will continue to pay your Part B premium if you enroll in Part C and may also pay a premium for the Part C plan.

• Part D – also known as Prescription Drug Plan became effective in 2006.  A Medicare enrollee can get prescription drug coverage through a Part C Medicare Advantage plan or enroll in a stand-alone Prescription Drug plan.  The plan that is best and the cost associated with it are determined by the medications that each person uses.  There is an annual Open Enrollment in the 4th quarter that allows you to make a plan choice for the next calendar year.  This is particularly important when medications change or if you use some expensive drugs.

There are many factors to consider in determining the right options for each person.  Contact your Health Insurance agent for advice as you approach that magical 65th birthday.

by Chris McPike, Vice President
ComPro Insurance

402-488-5100 | www.comproins.com