Health insurance for older adults: Understanding your Medicare coverage

Medical News Today

2 days ago

Medicare offers many health insurance options, and understanding coverage options, rules, and processes is key. People who become eligible can begin considering Medicare options before turning 65.Medicare is government-funded health insurance for people ages 65 and older. It is also available to individuals under 65 with specific health conditions, including amyotrophic lateral sclerosis (ALS) or end stage renal disease (ESRD).Medicare is different from Medicaid, which helps people with low incomes and resources manage their healthcare costs.Getting to know MedicareBefore a person turns 65, they may consider their current health insurance, when it will end, and whether they may need any new or additional health coverage in the future.It's also a good time to prepare for Medicare, which many Americans will be eligible for free of charge, depending on their working history.Original Medicare comprises Part A and Part B, which cover most inpatient and outpatient services.Other Medicare parts include Medicare Advantage (Part C), Part D prescription drug plans, and Medigap supplement insurance plans. Private insurers administer these plans, some of which also include additional benefits and services.Individuals can choose a plan or combination of plans by considering:their budgetwhether they have doctor, hospital, or clinic preferencesboth their current and possible future health conditionstheir medicationsOnce eligible for Medicare, some people are automatically enrolled. If not, they can enroll online, by post, or in person at a local Social Security office.Enrollment in MedicareIndividuals may be automatically enrolled in Medicare parts A and B when they:have been receiving disability benefits and will be turning age 65 in 4 monthsare not turning age 65 but have been receiving disability benefits for 2 yearsare not turning age 65, but they have received an ESRD or ALS diagnosisTo avoid late enrollment penalties, those not automatically enrolled need to sign up during an enrollment period.The enrollment periods are as follows:Enrollment periodTimeframeDuring this time, you can…initial enrollment period (IEP)begins 3 months before a person's 65th birth month, continues throughout their birth month, and ends 3 months laterenroll in any planMedicare Advantage open enrollment period (MA-OEP)January 1 through March 31 every year• change to another Medicare Advantage Plan with or without drug coverage• leave a Medicare Advantage Plan to return to Original Medicare and enroll in a separate Part D prescription drug planopen enrollment period (OEP)October 15 through December 7 every year• leave or change to another Medicare Advantage Plan• sign up for, change, or leave Part D prescription drug plans• switch from Original Medicare to Medicare Advantage• switch from Medicare Advantage to Original Medicarespecial enrollment period (SEP)varies• sign up for a Medicare Advantage plan• sign up for a Part D prescription drug plan• change to another planMedicare coverageThe different Medicare parts include the following coverage:Medicare Part APart A covers inpatient hospital care.It covers many of the services a person receives when admitted to the hospital or other eligible inpatient healthcare facility.It does not cover most outpatient care, hospital room extras, private, custodial care, or long-term care.Medicare Part BPart B covers outpatient services, including diagnostic tests relating to health conditions.It also covers some preventive services and limited prescription drugs.Additionally, some doctor visits a person receives while admitted to the hospital may come from Part B coverage.Medicare Part D prescription drug plansPeople with Original Medicare can enroll in a Part D drug plan.Each Part D drug plan has a formulary, which is a list of covered medications.Private insurers administer these plans, and it is important to consider the different plan options, including the medications the plan covers, when comparing them.Medicare Advantage (Part C)Medicare Advantage plans must include the same benefits as Original Medicare parts A and B. However, they typically include additional benefits such as fitness, vision, and dental. Most Medicare Advantage plans also include the prescription drug coverage of Part D plans.People can use Medicare's plan finder to search for plans in their area.Medicare supplement insurance (Medigap)Only people with Original Medicare can enroll in a Medigap plan, which covers some of Original Medicare's out-of-pocket costs.There are currently 10 different Medigap plans to choose from, although not all plans are available in all areas, and costs can vary by insurer.Medicare costsMedicare costs will vary by plan but can include monthly premiums, deductibles, coinsurance, and copayments.Part AIn 2025, Medicare Part A costs include:Monthly premiums: Most people do not pay a Part A premium, but this will depend on their working history.Deductible: Individuals must pay the Part A deductible of $1,676 per benefit period before the plan covers its share of costs. A benefit period begins when a person is admitted to the hospital and ends when they have not received any inpatient care for 60 consecutive days.Copayments: Depending on the length of a person's hospital stay, copayments can range from $0 to the full cost of services.Part B2025 Medicare Part B costs include:Premiums: Premiums start from $185 per month and increase based on a person's income.Deductible: People must pay a $257 deductible before the plan pays its share of eligible costs.Coinsurance: There is a 20% coinsurance that applies to the Medicare-approved amount for eligible Part B items or services.Medicare Advantage (Part C)Medicare Advantage plan costs vary but can include:monthly premiumsannual deductiblescopaymentscoinsuranceAccording to the Centers for Medicare & Medicaid Services (CMS), in 2025, the average Medicare Advantage monthly premium is around $17.Part D prescription drug plansPremiums and other out-of-pocket costs for Medicare Part D prescription drug plans vary by plan, plan provider, and a person's location.In 2025, the national base premium is $36.78, and a person's plan price can increase based on their income.Medigap plansIndividuals will pay a separate premium for a Medigap plan, which can vary by plan provider and location.Medicare billingMost people will not receive a bill from Medicare, as it generally operates a Fee-For-Service (FFS) model. This means that doctors, healthcare professionals, facilities, hospitals, and clinics bill Medicare directly for each item or service they provide.Medicare may automatically deduct plan premiums from Social Security benefits, but if not, it will send a bill.Paying Medicare premiumsThere are various ways to pay Medicare bills each month, including:through Medicare's website, with a debit or credit cardby mail, using a check, money order, or payment formAnother way to pay Medicare bills is through Medicare Easy Pay. This free service allows people to pay their monthly Original Medicare premiums through automatic bank withdrawals. Individuals can print and complete the Authorization Agreement for Preauthorized Payments form (SF-5510), which is available in English and Spanish.SummaryMedicare can be complicated, but understanding the basics can help individuals focus on their coverage needs.Original Medicare parts A and B cover inpatient and outpatient medical services. A person can add other plans to cover take-home prescription medications and some of Original Medicare's out-of-pocket costs. Other bundled plans are also available.Medicare's website allows people to browse the different plan options that are available locally, which can help them make the best choice for their healthcare.