Medicare is the federal health care program available to people 65 or older that provides medical coverage in retirement and older age. Coverage types are divided into four parts: Part A, B, C and D.
Eligibility and coverage
Medicare can be a very complicated system, so you should always contact the Center for Medicare & Medicaid Services (CMS) for specific details about enrollment and eligibility. However, the following provides a general overview of what each part of Medicare covers and who is eligible.
This option covers services such as hospital stays, nursing home care and home health. Eligibility for Part A comes down to the following factors:
- Age - Generally, you must be 65 to qualify for Part A.
- Quarters of coverage (QC) - The Social Security contributions paid through payroll tax during periods of employment prior to 65. The number of QCs needed can be complicated, so contact the CMS to determine your requirements.
A person who has not contributed enough QCs to social security can elect to pay a premium to be covered under Part A, but they must first qualify for Part B.
The second option covers medical equipment, research, ambulance and mental health services, as well as non-physician practitioners.
If you are eligible for Part A, then you are eligible for Part B; however, it is a voluntary service and requires the payment of a monthly premium. You do not have to accept Part B coverage. People earning less than $85,000 a year will pay approximately $104.90 a month. People who earn more will pay a higher premium based on their total income.
Also known as the Medicare Advantage Plan, Part C is a voluntary opt-in service that offers additional benefits not available in Parts A and B, including dental, vision, hearing and general wellness programs. It works in a similar fashion to private health insurance, with different types of plans available.
To be eligible for Part C, you must be entitled to Part A and enrolled in Part B. There is a monthly premium charged, in addition to the premiums being paid for Part B. Costs will vary by plan, and there may be a deductible for some services. The average cost of Part C runs about $40 a month.
This part is an elective prescription drug program that has variable plans similar to Part C. You are eligible for Part D if you are already enrolled in Part A or B. Plans can run from $15 to $80 dollars a month, and not all plans cover every type of medication, so do your research before making a commitment that isn't suitable to your needs.
The CMS can answer many of your eligibility questions, but if you're worried about your finances in retirement you should contact your Atlanta financial advisor for retirement and health care planning.