You are eligible for Medicare and have probably been looking forward to the lower cost of health insurance. If you are nearing age 65, you need to be aware of the common pitfalls that many eligible people have experienced:
You did not sign up during your initial enrollment period.
You have a seven-month period to sign up for Medicare, running from three months before your birthday to three months after the month you turn 65. If you don’t sign up during that time, you will need to enroll during the “general enrollment period,” which runs from January 1st to March 31st each year. Be aware that when you sign up during the general enrollment period, your coverage will not start until July, and your coverage for Part B (medical coverage) will cost more.
You did not understand late enrollment penalties.
Every 12 months of delay in enrolling in Part B (medical coverage) leads to an increase of 10 percent. However, if you are still covered by your employer, the penalty won’t apply.
You did not sign up for a prescription plan when you enrolled.
Many people don’t know that if they don’t sign up for Part D (prescription coverage), they will be charged a penalty of 1 percent.
You didn’t understand the difference between a Medicare Advantage Plan and Original Medicare.
Medicare Part A is hospital coverage, and Medicare Part B is outpatient medical coverage. A Medicare Advantage Plan merges these two plans into one and offers some added benefits. Private insurance companies offer these plans. However, if you have an Advantage plan, you cannot purchase Medigap insurance to help pay your out-of-pocket costs.
You were shocked at the out-of-pocket costs.
When you are enrolled in Medicare, you will still be responsible for paying some of the cost of your treatments and care. You will be responsible for paying your premiums (the premiums for Part B can be deducted from your Social Security benefits). You will be responsible for the deductible on your plan. A Medigap plan can cover some of the costs if you have Medicare Part A and Part B. You may need to pay an amount called a “copay” every time you see a doctor. You will also pay for coinsurance, the cost of some medical services.
You did not know your doctor was out-of-network.
If you have a doctor you trust, you must ensure the doctor is in the network of the plan you choose. Otherwise, you will pay more to visit that physician.
Your prescription drug plan doesn’t work for you.
If you purchase a stand-alone prescription drug plan (Medicare Part D), you need to look over the list of drugs the plan covers (the formulary). You may be required to get prior approval for medication or owe the lion’s share of the cost if you purchase the wrong plan.
Get Help if You Need it.
The government offers several types of assistance to help people who are enrolling in Medicare. Many people elect to get assistance from a local insurance agent who will guide them through the process, help them avoid the pitfalls, and will work with them personally.