3 Medicare Mistakes You Must Avoid
Once you’re nearing age 65, you start getting calls, mail, and emails about health care. It can feel quite overwhelming, but it is imperative that you learn how to manage your Medicare benefits to avoid these three critical and common mistakes.
1. Missing your initial Medicare enrollment period
You can sign up in any year during general open enrollment, but that leaves you vulnerable to higher premiums. Your initial enrollment period (IEP) starts three months before you turn 65, and continues until three months after the month of your 65th birthday. That’s seven months for you to enroll in Medicare Part A and Part B, but your benefits will be delayed if you don’t sign up while you’re still 64. Do you want to wait for coverage?
Missing your initial enrollment period can result in higher premiums for Part B. Most people don’t pay for Part A, but if you do, those could be higher, too. You could get a 10-percent penalty on Part B premiums by signing up late unless you delay because you have other coverage. Be sure to talk to a Medicare representative about whether you’ll be entitled to a special enrollment period after your initial open enrollment.
2. Assuming that Medicare doesn’t have any premiums
Most people enrolling in Part A will not have to pay a premium for it, but everyone pays for Part B. Part A helps with hospital expenses, in-patient rehab while Part B helps with doctor expenses and most all other out-patient costs. The standard Part B monthly premium is $104.90 in 2013, but those in a higher-income bracket will have to pay more. For more info about Part A and Part B costs go to: www.medicare.gov
3. Not comparing plans and premiums
Remember that original Medicare is just one option. You probably have about a dozen Medicare Advantage Plans available where you live that could replace Part A and Part B benefits with a private health insurance plan. Be extremely careful with advantage plans as it will limit which doctors and clinics you can work with and will require you to get a referral for just about any specialist visit. Also, Advantage plans have copays and can result in a very high out-of-pocket max for a serious condition.
Failing to shop around is the biggest and most common mistake that people make when it comes to Medicare, or any health insurance plan for that matter. An Advantage plan may offer extra coverage for dental care, eyeglasses, health club memberships, hearing aids, or prescriptions. Most Advantage plans do cover medication. Original Medicare rarely does so. You might find a plan that would pay for a lot more of your healthcare than original Medicare, but you’ll never know unless you see what’s available. Also, the benefits offered by an advantage plan can and often does change from year to year.