Medicare

Medicare is comprised of several parts to help cover specific services:

Part A (Hospital insurance). Covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care. Part A is mandatory. You usually don't pay a monthly premium for Part A coverage if you or your spouse paid Medicare taxes for at least 20 calendar quarters while working.

Part B (Medical insurance). Covers certain doctors' services, outpatient care, medical supplies, and preventive services. Part B is optional and is available at additional cost.

Part C (Medicare Advantage Plans). A type of Medicare health plan offered by a private company which contracts with Medicare. Medicare Advantage Plans are more like an HMO or PPO and provide all your Part A and Part B (and optionally, Part D) benefits. Part C is optional and is available at additional cost.

Part D (Prescription Drug Coverage). Coverage for prescription drugs. Part D is optional and is available at additional cost.

Most individuals subscribe to Medicare Part A and Part B coverages.  If you require prescription medications, then adding Part D coverage makes sense.

Medicare does impose limitations with respect to the types of services that it will cover under Parts A and B. Medicare also assesses an annual deductible that you must pay for your prescriptions before it will begin to pay for them under Part D coverage. For specific details, please refer to
www.medicare.gov.

You should apply for Medicare health insurance coverage exactly 3 months before you turn age 65. If you delay your enrollment, you may incur a late enrollment penalty, higher monthly premiums, and a gap in coverage.

To apply for Medicare insurance coverage, click here

Once you have been approved for Medicare insurance coverage, you should contact your current employer or private health insurance provider to convert your current health insurance plan over to a “supplemental” health insurance plan, which would be accessed only after Medicare coverage benefits have been exhausted. Such a conversion should provide you with a significant reduction in the cost of the monthly premiums that you have been paying for such health insurance coverage.

The costs of your Medicare premiums are determined by your Modified Adjusted Gross Income (MAGI), as reported on your Federal Form 1040 income tax return from two years prior.  I.e., the cost of your 2022 Medicare premiums will be determined by your MAGI, as reported on your 2020 Form 1040 income tax return.  The cost of your 2021 Medicare premiums were determined by your MAGI, as reported on your 2019 Form 1040 income tax return.

If you are eligible for and receiving Social Security benefits, your Medicare premiums will be deducted directly from your monthly Social Security benefits. If you are not eligible for Social Security benefits, or you have opted to defer receiving your Social Security benefits to a later age, Medicare will bill you for your premiums quarterly.