Simple Blueprint for Mastering Medicare: Step 1
Hello, I’m David Middleton, part of a father and son team, Middleton Healthcare Advisors.
Questions, questions, questions. There’s no end to questions, and nowhere is that more true than with Medicare! This is the first step in a series that we’re doing on Mastering Medicare, where we’re going to share a simple 10-step blueprint that is designed to take you from feeling ‘confused and clueless’ all the way to ‘clear and confident’!
How nice would that be? If you’ve ever dabbled in Medicare at all, you know exactly how wonderful that would be. That’s where we’re going with this, so let’s get started!
Answering the Question...before the Question
Step1 is to decide when you want to start on Medicare.
And you have two options:
- At 65
- At retirement and/or a loss of group health insurance.
We’re gonna unpack those two as we go forward.
But let’s first answer the question: what does Medicare consist of?
It consists of Part A and Part B.
Part A - Hospital insurance
We’re going to look at what it covers, and what it costs.
A. What it COVERS
It covers:
- inpatient hospital care
- skilled nursing care
- some home health care and hospice.
B. What it COSTS (for 2024)
The monthly premium for Part A is $0.
Deductible is $1,632 for each 60-day benefit period (days 1-60).
Then you’ve got daily co-insurance for days 61 through 90 of $400…
$800 for lifetime reserve days, and skilled nursing facility co-insurance is $203 a day days 21 through 100.
Part B - Medical insurance
A. What it COVERS
It covers such things as:
- doctor visits
- outpatient services
- lab and x-ray services
- DME (durable medical equipment) and supplies
- preventive services
B. What it COSTS (for 2024)
- Monthly premium – $174.70
- Annual deductible of $240.
- Part B co-insurance of 20% (of the Medicare approved amount)
- You could have a 15% excess charge
- No cap on out-of-pocket services
Here’s a few additional notes on the two parts:
Part A
Most people are entitled to it, having worked at least 10 years or 40 quarters.
And for most people it’s premium free, having paid into the FICA taxes through their working years.
Part B
You can delay it without penalty, if you’re still working and have group health insurance.
And most people pay the standard monthly premium of $174.70. But it could be higher based on your income.
Medicare Made Simple
FREE VIDEO GUIDE
Turning 65 and starting on Medicare soon? Watch this short 12 min Video that explains everything you need to know to make an informed medicare decision and finally get out of the Medicare Maze
Step 1: Decide When You want to start on Medicare
So, back to Step 1: When should you start on Medicare? Let’s look further.
Option 1 – At 65
This is during your initial enrollment period or IEP.
This is a seven month window that begins three months before the month you turn 65,
Includes your birth month, and ends three months after the month you turn 65.
If your birthday is October 27th, your Medicare is going to start on October 1st.
You go back three months to the 1st of July, and then you go three months beyond October to the end of January.
There’s your seven-month window (if you don’t enroll during this time period, you may have to pay Part B and Part D late enrollment penalties).
Note: your Medicare is always going to begin the 1st day of the month you turn 65, although if your birthday is the 1st day of the month, your Medicare is going to bump to the 1st day of the previous month.
One another thing, if you choose to start ‘At 65’, there are two overarching considerations.
A. You’re drawing Social Security (i.e., you’re retired or you have no health insurance),
- you’ll automatically be enrolled into Social Security
- You’ll receive the Medicare card about three and a half months prior to the first day of your 65th birthday month, and
- the Part B premium will start being deducted from your Social Security check in your 65th birthday month, or perhaps the month before.
And if:
B. You’re not drawing Social Security (i.e., still working with no or bad health insurance):
- You’re not automatically going to be enrolled in Medicare.
- You must manually enroll be enrolled through Social Security.
- And you’ll receive a quarterly bill in the mail to pay that Part B premium times three months is going to be $524.10.
Option 2 – At Retirement and/or a loss of group health insurance.
This is during your special enrollment period or SEP, an eight-month window you have to sign up after your employment ends or your group health insurance ends, whichever happens first.
And this is when you plan on retiring and or losing your group health insurance. Or if your group health insurance ends, and you decide you want to start on Medicare, you can always compare the two and see which one ends up being better for you.
You must manually enroll via Social Security, to start your Medicare Part B, and it’s helpful to start this process about 60 to 90 days before you want your Medicare to begin.
Helpful Notes
At retirement, you must provide:
- proof of employment all the way back to 65 with no missing months, and
- proof of creditable health insurance coverage (and most group health insurance is considered credible).
Also, some helpful forms are:
- the L-564 to give to your HR department for them to give proof of employment, and the
- CMS-40B that tells Medicare what month you wish to start your retirement.
Summary of Step 1
Okay, so here’s a summary of Step 1. When should you start on Medicare?
If you’re starting Medicare:
At 65 (during your IEP):
And you’re drawing Social Security…
You’re gonna automatically be enrolled in Medicare.
You don’t have to do anything.
You’ll get the red, white, and blue card in the mail ca. 3 ½ months before your effective date.
If you’re not already drawing Social Security…
You’re gonna have to manually enroll.
And then if you start your Medicare:
At Retirement and/or a loss of Group Health Insurance (during your SEP):
The focus is on starting Medicare Part B.
The effective date should be the first day following the end of group health insurance, and you must manually enroll again via Social Security.
And the ideal method is to enroll online.
Questions? Let us Know how we can help
Well there you have it folks…that’s Step 1: Decide when to start on Medicare.
We want to thank you for joining us here, and hope this was helpful.
If you have any questions, you can either go to our website at MiddletonHealthcareAdvisors.com,
or you can call us at: 888-322-8922.
Either way, love to hear from you. Take care, and God’s best to you!