As you approach retirement, one of the most difficult choices will be deciding on your health insurance. There are many different plans with many different benefits levels, co-pays, deductibles, and exclusions that it can get confusing. Let’s explore some of the options that senior citizens have when it comes to health insurance alone.
The insurance plans that most people are familiar with are Medicare and Medicaid which are part of the Social Security system. Almost everyone has heard of these, but few people understand how they work and often confuse the two. We will go over each of them to help you understand them individually.
Medicare is an insurance plan for the elderly and the disabled. You can qualify automatically when you turn 65 years of age and have at least ten years of full-time work history. Medicare is a federally funded health insurance program with different parts to it. There is Part A, Part B, Part C, and Part D. There are also supplements called Medigap. Medicare Part A is known as hospital insurance. This part covers the costs when you are admitted as an inpatient into a hospital, skilled nursing facility, hospice care, and sometimes home health care. Medicare Part B is for outpatient services like doctor’s visits, medical equipment and supplies, lab and radiology tests, mental health services, and some preventative care like shots. Neither of these, Part A and Part B, are free. There are monthly premiums you have to pay and may have a deductible. Medigap usually covers some or all those fees. Some things that aren’t covered are dental care, eye exams for glasses, hearing aids, medicine, and long-term care.
There are Medicare Advantage plans that cover all of those. Medicare Part C is a substitute for Medicare Part A and B. These insurances are offered by private companies that have a contract with the federal government. They usually receive compensation from the government for these plans. With Medicare Advantage plans you must pick one primary care doctor and use a select network of providers unless it’s an emergency. You will also have coverage for vision, dental, and prescription drugs with an Advantage plan. Medicare Part D is for those that have Part A and B. It provides coverage for your prescription medication. This coverage is from private insurance companies and different plans will cover different medications to different degrees. Medigap policies are sold by private companies also. This coverage fills the gaps in Parts A and B. It helps you pay some of the copayments and deductibles you may have at certain doctor’s offices. Medigap can be helpful. You will have six months to buy any Medigap policy after you enroll in Parts A and B. When you are buying insurance, make sure you choose the policy that is most appropriate for your needs and that you can afford. Make sure you consider what coverage is the most important to you. You don’t want to buy insurance coverage that doesn’t pay for the prescriptions or services you need regularly. The out-of-pocket expenses may be more costly to you than the insurance premium. Do your own research and if you can’t, have your family help you. Often, senior centers have advocates there that can also help you decide which plan is best for you.
Medicaid is another (partially) federally funded health insurance program. Every state has a Medicaid program, but the qualifications are different than those for Medicare. Medicaid is given to those individuals that are in need. This includes senior citizens, children, pregnant women, disabled people, and those with limited income. Medicaid covers many of the same services that Medicare covers. Medicaid also covers most of the costs that are affiliated with long-term care in skilled nursing homes, hospice care, or home health services. Unfortunately, to qualify for Medicaid, many seniors must have little to no assets. Criteria for eligibility and services covered may vary from state to state. Some services cost less in some states and more in others. To see what is covered in your state, click on this link https://www.medicaid.gov/state-overviews/index.html. Once you pick your state, it will provide you information such as how to enroll, eligibility requirements, quality of care in your state, and other state-specific programs.