What to know about navigating Medicare
Medicare consists of several parts. Understanding these parts and knowing how to navigate Medicare may help people prevent future frustrations.
Medicare is a United States Government-funded insurance program that becomes available when people reach 65 years of age or to certain other groups under this age, such as those with disabilities or chronic illnesses.
While a Medicare plan can absorb the costs of expensive treatments for ongoing illnesses or injuries, it can be complex. Several coverage options are available, limited enrollment periods are available, changing doctors can affect coverage, and Medicare may reject some claims.
This article explains how to navigate the different parts, when to enroll, how to switch doctors, and what to do if Medicare does not pay for certain treatments.
Glossary of Medicare terms
We may use a few terms in this article that can be helpful to understand when selecting the best insurance plan:
Out-of-pocket costs: An out-of-pocket cost is the amount a person must pay for medical care when Medicare does not pay the total cost or offer coverage. These costs can include deductibles, coinsurance, copayments, and premiums.
Deductible: This is an annual amount a person must spend out of pocket within a certain period before an insurer starts to fund their treatments.
Coinsurance: This is the percentage of treatment costs that a person must self-fund. For Medicare Part B, this is 20%.
Copayment: This is a fixed dollar amount a person with insurance pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
What is Original Medicare?
Original Medicare is one of two options for which a person becomes eligible when they reach 65 years of age.
It includes Parts A and B. Original Medicare covers most medically necessary services, supplies, and treatment with any doctor or facility that accepts Medicare coverage. People most often will not need a referral to consult with a specialist.
People pay certain out-of-pocket costs for each part, such as a deductible or coinsurance.
Prescription drug coverage is not compulsory. However, a 1% penalty per month applies to the premium if a person does not join Part D when they first enroll for Medicare or goes 63 days or longer without drug coverage.
A separate plan called Medicare Supplement Insurance, or Medigap, can help cover out-of-pocket costs for Parts A and B. This is only available for people who have Original Medicare.
Learn more about Original Medicare.
Part A
Medicare Part A covers hospital costs, including in-hospital treatment and medically necessary inpatient care in skilled nursing facilities.
Around 99% of people do not pay a premium for Part A, as they cover this by paying income tax throughout 40 quarters of work, or around 10 years.
In 2024, a person would have to pay the first $1,632 of inpatient treatment. If treatment lasts for longer than 60 days, a daily coinsurance of $408 would apply. After the 91st day of treatment, this increases to $816 per day for up to 60 “lifetime reserve” days.
The funds for lifetime reserve days do not replenish yearly like the first 90 days of an in-hospital stay. Once a person uses these up, they become responsible for all costs.
Learn more about Medicare Part A.
Part B
Medicare Part B covers medical treatment received on an outpatient basis, including doctor services, consultations with other medical professionals, and home healthcare. It also covers durable medical equipment, including walkers, wheelchairs, and hospital beds.
Part B also covers a yearly wellness visit and other preventive services, including vaccines and screenings.
Medicare generally pays for 80% of any service that Part B covers, leaving the beneficiary with 20% to pay. In 2024, the premium for Part B was $174.40 for people who earned under $103,000 per year.
Learn more about Medicare Part B.
What is Medicare Advantage?
Medicare Advantage is a plan that private companies administer in accordance with Medicare regulations. They offer a bundled package that includes all coverage from Parts A and B and often provides drug coverage.
These plans typically offer benefits that do not feature in Original Medicare, such as dental, vision, and hearing services.
People on a Medicare Advantage plan often need to use doctors within the plan’s agreed network, but they may have lower out-of-pocket costs than Original Medicare.
Different types of Medicare Advantage plans have varying rules around which doctors a person can visit or how this affects what Medicare will pay, including:
Health Maintenance Organization (HMO) plans: For Medicare to pay, a person with an HMO plan must typically receive care from in-network doctors. A specific doctor, or primary care physician (PCP), is often necessary to make referrals for medically necessary specialist visits.
Preferred Provider Organization (PPO) plans: People on PPO plans can use out-of-network doctors, but they will likely have higher out-of-pocket costs than in-network providers.
Private Fee-for-Service (PFFS) plans: Those with PFFS plans can see any doctor who accepts Medicare. Some plans allow healthcare providers to charge 15% more than Medicare pays, known as balance billing. The beneficiary is responsible for the difference.
Special Needs Plans (SNPs): These serve people with specific illnesses or care needs. SNP providers personalize them to cover the treatments a person with a certain condition is most likely to use.
Medical Savings Account (MSA) plans: This is a mix of a high deductible Medicare plan and a savings account specifically for medical treatments. Medicare gives an MSA a fixed sum to deposit in a person’s account for healthcare purposes each year. People can then use this to pay for healthcare. If they use up the funds in the account, they must self-fund treatment until they reach their deductible. Leftover money stays in the account.
The premiums, out-of-pocket costs, and benefits of these will vary between providers, locations, plan types, and products. Individuals can use Medicare’s Advantage Plan Finder to compare different options.
Learn more about Original Medicare vs. Medicare Advantage.
What are the enrollment periods?
Enrollment periods are time frames in which people can join, leave, or change plans. Original Medicare and Medicare Advantage have different enrollment periods. Understanding these periods and enrolling at the right time can help people avoid unexpected charges, lost coverage, or penalty fees later on.
Initial enrollment
Initial enrollment is a window of time during which a person can apply for Medicare when they first become eligible.
This period begins 3 months before the month in which a person reaches 65 years of age and lasts until the end of the third month after this. If a person’s birthday is on the first day of the month, the initial enrollment period starts one month earlier, giving them 4 months before their birthday instead of three.
Coverage begins on the same day a person’s Medicare starts if they request to join a plan before becoming eligible. If they make the request after becoming eligible, the coverage will start on the first of the following month. Individuals who apply for Part B after starting Part A can change or drop the plan in the 3 months before starting Part B.
Those who join a Medicare Advantage plan during initial enrollment can switch to a different Advantage plan or return to Original Medicare in the first 3 months of having Medicare Parts A and B.
Open enrollment
Open enrollment runs from October 15 to December 7 every year. During this time, people can make the following changes to their plan:
change from Original Medicare to Medicare Advantage or switch the other way
change from one Medicare Advantage plan to another
add or drop Part D drug coverage
switch from one drug plan to another
Coverage starts on January 1st of the following year.
Medicare Advantage open enrollment
This applies only to people already in a Medicare Advantage plan. From January 1st to March 31st, or in the first 3 months of getting Medicare, they can switch to a different Advantage plan or drop their plan to return to Original Medicare.
Coverage begins on the first of the month following the request to change.
Learn more about Medicare enrollment periods.
How to find and change doctors with Medicare
People may need to change doctors if they need a different level of care, they move to a different area, or their current doctor stops accepting Medicare.
Several resources, including the Centers for Medicare and Medicaid Services’ (CMS) Physician Compare tool, can help people find a new physician who accepts Medicare. People on Original Medicare can use any physician who accepts Medicare.
If a person has a Medicare Advantage plan, their insurance provider may have a specific network of physicians who accept their prices and payments. An individual will only be allowed to use these physicians on many plans, so speak to the provider or use their search tools to find a doctor within that provider network.
How to avoid surprise bills with Medicare
Most Medicare policies require out-of-pocket costs or have restrictions on coverage that might mean a person ends up having to pay more for treatment than they expected.
People can reduce the risk of these unexpected bills by checking in advance what treatment costs Medicare will cover. Medicare provides a coverage checking tool to assist, but coverage may vary depending on a person’s area of residence.
Check with a provider as to whether Medicare will cover a particular treatment or test. It can also help to ask a provider about their Medicare status or avoid using healthcare professionals from outside of the agreed provider network for those on Medicare Advantage.
A Medigap policy can help cover out-of-pocket costs for people with Original Medicare. Although it requires an additional monthly premium, it can help reduce the risk of surprise bills after treatment.
Learn about Medigap plans and costs.
Know what to do if Medicare denies a claim
Medicare does not pay for services that fall outside of coverage. However, beneficiaries and providers may not agree that services are outside of the agreed terms.
According to the American Association of Retired Persons (AARP), people can take the following steps if Medicare declines to pay a claim:
Contact the provider to make sure they have billed the correct procedure codes.
People who have Medigap should contact their insurance provider to ask why they have not paid the out-of-pocket costs.
People can file an appeal with help from the Medicare Rights Center. Their telephone number is 800-333-4114. The nearest State Health Insurance Assistance Program (SHIP) may also be able to help. Individuals have the right to appeal a service, drug, equipment item, or discharge from the hospital.
If none of these steps are successful, many healthcare professionals are happy to negotiate the price of a bill.
Learn more about the Medicare appeals process.
Resources for Medicare information
Those seeking more information about Medicare and its plans can get more information from the Social Security Administration (SSA), including forms for applying, replacing damaged or lost Medicare cards, and seeking extra help with prescription drug coverage.
Coverage and pricing may vary at a local level, so individuals can contact Medicare either online or by phone for help finding who to contact about billing, complaints, appeals, applications, and particular health plans. The individuals at Medicare can also help discuss coverage options and give more information.
The Medicare & You handbook provides in-depth information on coverage and the different Parts.
Medicare resources
For more resources to help guide you through the complex world of medical insurance, visit our Medicare hub.
Summary
Medicare is complex. However, applying during the right enrollment period, picking a product or plan that suits a person’s health and financial needs, and taking steps to reduce and respond to unexpected bills can all help a person more easily navigate health insurance.
Speak to Medicare directly, a private insurer, or a local SHIP office for more information on plans, coverage, and disputes.
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