Things to Consider When Planning for Retirement: Healthcare
What is Medicare?
Medicare is a federal health insurance program for certain individuals with disabilities, end-stage renal disease, and most importantly, people who are age 65 and older. Even if you have federal health insurance under Medicare, managing your benefits and securing full coverage of your medical expenses can be tricky.What does Medicare Cover?
Medicare is divided into four parts: Part A covers hospital, skilled nursing facility, hospice and home health services; Part B covers doctor’s visits, outpatient services, and certain medical supplies/equipment; Part C includes Medicare Advantage plans, which are plans that offer comprehensive coverage through private insurance companies; and Part D is the prescription drug plan.You can sign up for Medicare beginning three months before you turn 65, and coverage can start as soon as the first day of your birthday month. The initial enrollment period lasts until three months after your 65th birthday. If you do not sign up for Medicare within 3 months of your 65th birthday, in most cases, your Part B premiums increase by 10 percent for each 12-month period you were eligible for Medicare but didn't sign up. If you continue working beyond age 65 and are covered by your employer’s medical insurance plan as an active employee, the late enrollment penalties typically do not apply.
Most retirees don’t pay a premium for Medicare Part A; however, the standard premium amount for Medicare Part B medical insurance is $104.90 per month (in 2016). The deductible for Medicare Part B is $166 per year, and once you’ve met your deductible, Medicare will pay 80% of your eligible medical expenses and you are responsible for paying the remaining 20%. The premiums for Parts C and D vary by plan. Premiums for both Parts B and D can come with a surcharge when your adjusted gross income is more than $85,000 if you are single or $170,000 if married and filing jointly.
What Medicare does not cover?
Medicare is a defined-benefits program and coverage is limited to what has been enumerated by Congress in Medicare regulations and guidelines. There are a variety of medical services commonly used by elderly people that Medicare does not cover, including routine dental or eye care, dentures and hearing aids, cosmetic surgery, acupuncture, routine foot care, and extensive long-term care in a nursing home or assisted living facility. Out-of-pocket expenses for retirees can still be very high with traditional Medicare coverage; therefore, some retirees supplement their Medicare coverage with a Part C Medicare Advantage or “Medigap” plan. These plans charge an additional premium, but fill in many of Medicare’s cost-sharing requirements, and sometimes cover additional services that traditional Medicare does not cover.While Medicare can be an affordable healthcare option for retirees, it is imperative to know your personal needs and whether or not you require additional coverage. Medicare’s coverage is limited, and sometimes, coverage may be denied in certain circumstances.
If you are having issues with Medicare, an experienced attorney can oftentimes help you navigate the process. If you need to find an attorney, visit Legal Services Link, post a summary of your legal needs, and let the perfect attorney come to you!
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Posted - 08/30/2016
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