If you're an American citizen or permanent legal resident age 65 or older, you qualify for Medicare - even if you don't collect Social Security yet.
Unless you have a qualifying medical condition, the Medicare age requirement is 65. The vast majority of Medicare beneficiaries – over 85 percent – qualify due to age.
Who Qualifies for Medicare?
U.S. citizens and permanent legal residents who are age 65 or older qualify for Medicare. You may be eligible before you turn 65 if you collect Railroad Retirement Board (RRB) or Social Security disability benefits for 24 months.
If you have amyotrophic lateral sclerosis (ALS, commonly known as Lou Gehrig's disease), you'll automatically get Medicare Parts A and B (Original Medicare) the same month your disability benefits begin. You may then choose to join a Medicare Part C (more commonly known as Medicare Advantage) or Medicare Part D prescription drug plan (PDP).
People who have end-stage renal disease (ESRD) may also choose to sign up for Medicare before they turn 65. And, as with ALS, these beneficiaries may also join a Medicare Advantage or prescription drug plan.
What's Included with Original Medicare?
Original Medicare includes Part A, hospital insurance, and Part B, medical insurance.
Medicare Part A helps pay for inpatient care such as you'd receive in a hospital or skilled nursing facility (SNF). Medicare Part B covers services like doctor visits, lab work, durable medical equipment (DME), and mental health care. Part B also covers a variety of preventive care and screenings, including the Medicare Annual Wellness Exam, mammograms, and prostate exams.
How Much Does Original Medicare Cost?
The Medicare program uses a cost-saving model to help control utilization. This model includes deductibles, monthly premiums, and coinsurance or copayments.
Typically, you must meet your deductible before Medicare begins paying its share.
Medicare Part A Costs
Medicare Part A has a deductible of $1,600 per benefit period in 2023. A benefit period begins when you're admitted as an inpatient and ends once you go 60 consecutive days without receiving inpatient care. This means you may have more than one benefit period in a calendar year.
You may also have to pay coinsurance for each benefit period. For the first 60 days, your coinsurance is $0. Days 61 through 90 have a daily coinsurance of $400 and days 91 through your 60 lifetime reserve days cost $800 per day. Once you go through your 60 lifetime reserve days, you are responsible for 100 percent of your Part A hospital costs.
If you have a qualifying hospital stay of at least 3 days, Part A also covers skilled nursing facility care. There is no coinsurance for the first 20 days. However, you will pay $200 per day for days 21 through 100. After that, you are responsible for all costs.
Finally, if you or your spouse did not pay Medicare taxes for the required 10 years (40 quarters), you will have to pay the Medicare Part A premium, which is $506 per month. If you worked and paid taxes for 30 or more quarters but less than 40, your monthly premium will be $278. Only around 1 percent of Medicare beneficiaries do not qualify for premium-free Part A.
Medicare Part B Costs
The annual deductible for Medicare Part B is $226 in 2023. There is also a monthly premium of $164.90. You owe this premium even if you sign up for a Medicare Advantage (MA) plan. You may be able to get help paying your monthly premium if you qualify for a Medicare Savings Program. Click here for more information.
Higher earners may have to pay the Income-Related Monthly Adjustment Amount, or IRMAA. This only applies to people who have a yearly income greater than $97,000 (filing singly) or $194,000 (married filing jointly). Fewer than 5 percent of Medicare beneficiaries owe the IRMAA surcharge.
Finally, most covered services require you to pay a coinsurance of 20 percent of the Medicare-approved amount. Some preventive services are covered completely, though.
How Do You Sign Up for Medicare?
Although the Centers for Medicare & Medicaid Services (CMS) manages the Medicare program, you enroll through the Social Security Administration (SSA) here. The online application is available 24 hours a day, 7 days a week.
You may also apply for Medicare by calling Social Security at 1-800-772-1213 or TTY 1-800-325-0778. Operators are available Monday through Friday. Previously, you were also able to sign up for Medicare through your local Social Security office. However, these offices have been closed due to COVID restrictions since March of 2020. If you want to try to schedule an appointment, you can find your local Social Security office here.
When Is the Best Time to Sign Up for Medicare?
The best time to sign up for Medicare is during your Initial Enrollment Period (IEP). If you age into the program, your IEP begins 3 months before your 65th birthday and ends 3 months after your birth month. The only difference is if your birthday falls on the first of the month.
- If you turn 65 on April 13, your IEP begins on January 1 and ends on July 31
- If you turn 65 on April 1, your IEP begins on December 1 and ends on June 30
You are only automatically enrolled in Medicare if you begin collecting RRB or Social Security benefits at least 4 months before turning 65. Everyone else has to apply.
People who qualify for Medicare due to disability are automatically enrolled during their 25th month of collecting benefits. However, they also have an Initial Enrollment Period that begins 3 months before their eligibility month and ends 7 months later.
During your IEP, you can also sign up for a Part D prescription drug plan and/or join a Medicare Advantage plan. If you miss your Initial Enrollment Period AND you don't qualify for a Special Enrollment Period (SEP), you have to wait for General Enrollment. This occurs every year from January 1 through March 31, with coverage beginning on July 1. Waiting for General Enrollment could result in a coverage gap, which could leave you owing lifetime late penalties.
Does Original Medicare Include Prescription Drug Coverage?
No, Original Medicare does not include prescription drug coverage. For that, you need Medicare Part D. You can get these benefits through either a standalone prescription drug plan or by joining a Medicare Advantage Prescription Drug plan (MA-PD). Please note that you cannot have both an MA-PD and a standalone plan.
What Is Medicare Advantage?
Medicare Advantage plans, also known as Medicare Part C, combine your Part A and Part B benefits into a single health plan. These plans resemble the health insurance many people have through an employer.
CMS requires all Advantage plans to provide the same level of coverage you'd have with Original Medicare. However, most offer additional benefits as well, such as prescription drug coverage, routine vision care, hearing aids, routine dental, and physical fitness programs like SilverSneakers.
You cannot have both a Medicare Advantage and a Medicare Supplement plan.
Do You Need Medicare Supplement Insurance?
Medicare Supplement plans, more commonly known as Medigap, help pay a variety of out-of-pocket costs when you have Original Medicare. There are 10 standardized Medigap plans (A, B, C, D, F, G, K, L, M, and N), with high deductible versions available in some areas. At a minimum, every Medigap plan covers your Part A deductible and gives you an additional 365 lifetime reserve days for inpatient care.
The best time to sign up for a Medigap plan is during your first 6 months with Medicare Part B, known as your Medigap Open Enrollment Period. Read our Ultimate Guide to Medicare Supplement Plans for more information on plan benefits and costs.
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