Coverage types video transcript
While Medicare is big - it covers 47 million older adults - it's a case where one size does NOT fit all. You have a lot of choices, which we'll explain here. Medicare coverage has lots of pieces, parts, and plans - how you combine them depends on your medical needs, your lifestyle, and your budget.
Is Original Medicare all you need?
Medicare coverage begins with Medicare Part A, which is primarily hospital coverage offered by the Federal government. It has no premiums and it covers about 80% of hospital, assisted living and nursing home care.
You can choose to purchase Part B, which is medical coverage for things like doctor visits. You'll pay a premium to the Federal government. Parts A and B are known as "Original Medicare."
If you don't go to the doctor often or you have other medical coverage through your employer, TRICARE or the Veterans Administration, Original Medicare may be right for you.
Once you've signed up for Parts A and B, you can choose to add coverage with a Medicare Advantage or Medigap plan. Let's review those two choices in more detail.
We'll start with Medigap plans.
Why add a Medigap plan?
Since Original Medicare doesn't pay 100% of medical costs, you can choose to purchase Medigap: a supplemental plan that helps pay costs not covered by Original Medicare. Some Medigap plans cover the 20% that Original Medicare doesn't cover, so your out-of-pocket expenses will be lower. Typically these plans have higher monthly premiums than a Medicare Advantage plan, but you usually pay less for any services.
These plans are offered and managed by private companies-like Priority Health.
Medigap plans give you the freedom to see any doctor who accepts Medicare, but you might have to pay a Medicare Part A and/or Part B deductible.
If you live outside of Michigan for more than a month each year and want to pay the same amount whether you see a doctor at home or away, a Medigap plan may be a good choice. Neither Original Medicare nor Medigap cover Part D prescription drugs.
However, you can choose to add Medicare Part D coverage from a private company.
A different option is Medicare Advantage - also known as Medicare Part C. It combines doctor visits, hospitalization and often prescription drugs in a single plan, like the health insurance many Americans are accustomed to. You'll pay a monthly premium to a private insurance company, but you'll enjoy predictable co-payments, and typically save money when you see doctors within the plan's network. Naturally, you can choose to see any doctor who accepts Medicare-it just might cost more if they're not in your plan's network.
Why add Medicare Advantage or MAPD?
One big difference between Medicare Advantage and Medigap plans is that some Medigap plans, when combined with Original Medicare, cover 100% of the cost of services; with a Medicare Advantage plan, you will have predictable copayments for services. Also, the monthly premiums for a Medicare Advantage plan can be quite a bit lower than a Medigap plan. Some plans even offer coverage for things like Part D prescription drugs, dental, vision, and gym memberships. If you want the simplicity of a single plan, don't need to see an out-of-network doctor too often and want a plan that could offer the option of prescription drug coverage, Medicare Advantage might be for you.
Whichever you choose, your first step is to enroll in Original Medicare (Parts A and B). You may be enrolled automatically, if you're already collecting Social Security benefits.
To enroll, visit your local Social Security Administration office, call them at 800.772.1213, or sign up online at ssa.gov