Medicare Myths and Realities
To ensure you have proper coverage in retirement, verify your assumptions before retirement. Here are some of the most common misconceptions about Medicare:
Myth: Medicare will cover all of my medical expenses.
Reality: Medicare covers approximately half of all medical and skilled nursing care expenses for an average Medicare enrollee. Some of the items and services Medicare does not cover include the following:
- Long-term care
- Routine dental care
- Cosmetic surgery
- Hearing aids
- Exams for fitting hearing aids
Myth: Medicare coverage is free.
Reality: You may pay monthly Medicare premiums along with deductibles, coinsurance, and co-payments for typical medical services. For 2017, costs are as follows:
- Part A: Typically, there is no premium charge for Part A. The annual deductible in 2017 is $1,316.
- Part B: The premium for most people is $134 per month. People with income over specified limits pay more. The annual deductible is $183, and there typically is a 20 percent copay.
- Part C plans: The Medicare Advantage Plans charge additional premiums, and copays vary.
- Part D plans: The Prescription Drug Coverage plans charge additional premiums, the deductible can be up to $400, and co-pays vary.
Learn more about Medicare Basics.
Myth: Having poor health means I will not qualify to join Medicare.
Reality: Medicare coverage is linked to Social Security coverage. If you qualify for Social Security retirement or disability benefits, then you likely will qualify for Medicare benefits (typically no earlier than age 65). There are exceptions for government employees who do not receive Social Security. If you do not qualify for Medicare coverage, you can purchase coverage by paying the required premiums for each Medicare Part you want. Note that even if you have qualified for Medicare, you still need to actually apply for coverage, because enrollment is not automatic. Be sure to understand your particular enrollment deadlines — if you miss one, you may incur a late penalty.
Myth: Once I am enrolled in Medicare, my coverage and costs will not change.
Reality: Medicare coverage and costs change each year. Even if your plan’s cost and coverage stay the same, your health or finances may change. Review your plan each year to make sure it still will meet your needs. This includes both Medicare and supplemental coverage purchased in the private insurance market or provided by a former employer.
Myth: I can enroll in Medicare at any time.
Reality: For your first-time enrollment, usually it is wise to enroll at age 65 for Medicare Part A. Generally you have a seven-month window around your 65th birthday (three months before and four months after) to enroll for Medicare Part B.
If for some reason you miss your initial enrollment window, you may pay a late penalty of 10 percent of your premiums. Note that you also may be eligible to enroll because of past work history (at another employer), or you may be eligible because your spouse is eligible.
For existing Medicare beneficiaries, there is an annual open enrollment period of about seven weeks in the fall (the dates may change). During open enrollment, you can explore any new health and/or drug plans that may fit your health care needs.