How to Choose a Medicare Plan

Reaching the age 65 will give you automatic Medicare eligibility. But contrary to popular belief, this health plan is not for free, and you have to understand everything about it before signing up. Otherwise, you’ll find it very expensive.

Even after being on Medicare for a long time, you might still want to go over your options every year, if only to make sure that your plan is right for you. October 5 to December 7 is the yearly open enrollment period, during which you can change your plan if you think it’s necessary.

It’s very important to review your options if you have a Medicare Part D drug plan or a Medicare Advantage plan, since these two usually change every year in terms of covered drugs, doctors, copay amounts and other features.

Medicare plans come in four different classifications:

Part A (Hospital Care, Skilled Nursing, Hospice and Some Home Health Care)

If you have a minimum Social Security work history of 10 years, you pay nothing for this, and your premium amoutn will be determined by your Social Security work credits.

Part B (Doctor Visits, Preventive Care, Outpatient Care And Hospitals, And Some Home Health Care)

In 2018, this is going to average $134 monthly for most beneficiaries with yearly incomes equal to or not exceeding $85,000 ($170,000 for couples), and as much as $428.60 for those who earn more than $214,000 ($428,000 for a couple) annually. If you’re like most people, you will probably need a Medigap plan on top of Parts A & B.

Part C – Medical Advantage Plan

There are companies in agreement with Medicare to provide Part A and Part B benefits, with some plans also offering coverage under Part D. The premiums will depend on the plan and the region, but the average for the Medicare Advantage plan in 2018 is $30, or 6% lower than a year earlier.

Part D – Prescripton Drugs

Premiums in 2018 average $33,50, which is lower than last year’s $34.70.

The first crucial decision Medicare beneficiaries have to make is whether they should chose traditional coverage (Parts A, B, and D) or a Medical Advantage plan (Part C). Medical Advantage plans can have low or zero monthly premiums, but they often restrict members to certain doctors and hospitals. Both options come with deductibles, copays and coinsurance, where you pay a portion of the bill.

If you go with traditional Medicare, you can simply get a Medicap policy, which is a supplemental policy that provides benefits outside of Medicare. There are 10 types of Medicap policies offered by private companies or groups, and the costs vary significantly. To determine the best choice, examine each plan carefully.

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