If you are reading this blog post, chances are you are at that point in life where you need to make some decisions about your retirement healthcare.
The purpose of this post is to give a quick overview of what I call "Medicare Alphabet Soup" :-).
So here we go...
The first thing to know is a little about what we call "Original Medicare". It contains 2 Parts. I emphasize the word Part with a capital, because there are "Parts" and "Plans" coming up in this overview and it can get confusing!
We will be going into the weeds a little!
My apologies in advance!
Ok, here goes...
Part A: Known as "hospital insurance" covers anything related to a hospital stay such as drugs given during the stay, some blood transfusions, and hospice care.
Part B: Also known as "doctor insurance" covers things like doctor appointments, preventative services, durable medical equipment.
It is important to note that neither Part A or B cover dental care, vision care, dentures, hearing aids, or healthcare outside of the United States.
Next we have:
Part D also known as "prescription drug coverage" because it helps reduce the out-of-pocket costs for prescription drugs by paying a portion of the cost.
Part C is known as "Medicare Advantage" and it usually includes Parts A, B, and D into one plan.
That wasn't too bad was it?
Hope not!
Now, most people get their Medicare coverage in one of two ways:
They choose option 1, Original Medicare; or option 2, Medicare Advantage.
When choosing Original Medicare, you enroll for "parts" A and B.
Then, most people purchase a standalone drug plan (Part D).
It is common for individuals to also purchase a Medicare Supplement (also known as Medigap) to help cover the gaps in Original Medicare.
Original Medicare is the most widely chosen option as there are no required networks to be a part of and it provides a consistent fixed expense each month.
When choosing Medicare Advantage (Part C), you get the coverage of Parts A and B and often Part D is included.
There is generally a lower monthly expense to Medicare Advantage than Original Medicare, but Medicare Advantage requires a select network of providers and generally has higher out-of-pocket costs than Original Medicare.
That's enough "soup" for today!
It's my hope that you are beginning to see how this isn't as complex as it may have seemed when you first looked at it.
Anyway, keep an eye out for Part 2 coming soon...
And naturally, if you have any questions, call us at 732-455-9990 or email me at artie@retire-usa.com