Medicare: Choosing The Right Plan

Medicare: Choosing The Right Plan

Medicare is one of the most transformative laws in U.S. history

Medicare: Choosing The Right Plan

by D. S. Mitchell

AARP Contribution

I am convinced one of the best publications for a senior citizen is AARP magazine. This little newspaper is a gem. A year ago Dena Burns wrote an article on how to be a smart consumer when it comes to Medicare benefits. I thought her observations were worth passing on.

Important Calendar Events

I can’ t stress this enough. When it comes to signing up for Medicare, time matters. So, sign up on time to avoid hassles and higher monthly premiums. The initial enrollment time is called the IEP, unless you have health insurance through your job or your spouse’s. The IEP spans 7 months; the month a beneficiary turns 65 and the 3 months before and after that birthday.  Missing the IEP can cost you, for the rest of your life. Here’s how it works for parts A, B, and D.

  • Part A: This is the hospitalization portion of the program and covers hospital stays and short term nursing facilities. If you miss your deadline you will have no coverage until you enroll.
  • Part B: This portion of the program covers doctor services, outpatient and preventive care along with some covered medical supplies. If you miss your enrollment deadline your premium will increase by 10 percent for every 12 months you are overdue in signing up. As an example, if you sign up 2 years late you will pay an estimated $6,500 more in monthly premiums over the next 20 years. 
  • Part D: Part D helps pay for prescription medications. In this case, if you miss your IEP your monthly premium will increase by 1% each month you remain unenrolled. In 2019 the average monthly premium was $31.83.  As an example, if you delay for 24 months to enroll, you will pay an additional $8.00 per month for your coverage for life. (* I personally have a  story regarding Part D.  I was hit with the additional 1% when I filed nearly 2 years late for Part D. In my case it was my employers fault and when I appealed the decision and it’s penalty I won the appeal because my employer had failed to provide the information to me, although they had provided all the enrollment information on Parts A and B.*)  So, remember, in some cases you can appeal the ruling and win, but it is easier to do it right to start with.
  • Once you are enrolled it is important to make a note each year that between October 15 and December 7 you can legally switch coverage for the upcoming year.

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