What You Need to Know When Your Parents Have Medicare
As people get older, health insurance becomes increasingly important, and sometimes, more complicated to understand. If your parents are getting close to the age of 65, they will soon be eligible for the government health program for seniors, called Medicare. The more you learn about Medicare, the more helpful you can be to them as they try to make the best decisions about their healthcare.
Wading Through Medicare's Alphabet Soup
Part A, Part B, Part C and Part D each describe one part of the services provided by Medicare, and once you understand the coverage of each part, you're ready to explore Medicare.
- Part A covers hospitalization, some skilled nursing facility and home health care, and hospice. Both your parents get this coverage free even if only one of them worked and paid Social Security taxes for at least 10 years.
- Part B covers doctor's care, lab tests, screenings and preventive services. Your parents will usually pay a monthly premium for this coverage.
- Part C, also called Medicare Advantage, consists of Medicare-approved plans offered by private insurers that include Medicare Part A and Part B coverage in one package. Some plans also include coverage of prescription drugs.
- Part D is the Medicare prescription drug benefit plan that your parents can purchase if they are eligible for Medicare.
Medicare Parts A and B are called traditional Medicare. Together they cover most of the medical care and treatments your parents will normally require. But some items are not covered and must be paid out-of-pocket, like the deductible for hospital charges and 20 percent of doctors' fees. Seniors worried about that gap can purchase private Medicare supplemental insurance, commonly referred to as Medigap insurance, which reimburses them for these out-of-pocket expenses. Medigap supplements traditional Medicare; it does not replace it.
Timing Is Crucial
If your parents are receiving Social Security benefits when they turn 65, they're automatically enrolled in Medicare Part A and are eligible to purchase Part B. However, if they elect to hold off on Social Security until after 65, they must enroll themselves — and timing is critical.
The first opportunity your parents will have to enroll in Medicare is the Medicare Initial Enrollment Period, a seven-month window of time that starts three months before the month in which they turn 65. If they do not enroll during this period, they can't sign up until the next General Enrollment Period, which runs between January 1 and March 31 each year. If they enroll then, coverage begins on July 1.
Which Plan to Choose
Helping your parents decide which Medicare plan to choose will get them started on the right foot. Investigate and compare the Medicare Advantage and Part D plans to see which plan fits your parents' needs best. For example, if one of your parents must take expensive pills because of a medical condition, you'll want to find a plan that covers those drugs. Use the Medicare plan finder tool to estimate the out-of-pocket costs for the drugs they take under every plan available in their area.