Ask Rusty: For Some Simple Guidance About Medicare

Dear Rusty: I’m nearing 68 years old, have never signed up for Medicare, but am thinking that I should look into it. I’m currently covered by my wife’s health insurance through her employer. I would greatly appreciate some simple guidance regarding Medicare. I’ve tried watching some videos about the subject, but it was always so boring that I never finished watching. I get lost in all the “Part This” & “Part That.” I would just like some solid insight into the coverage that I truly need and the cost.

Signed: Confused

Dear Confused: Medicare is, indeed, a confusing topic, but I’ll try to clear it all up for you. Think of it this way, Medicare has two main parts — one that provides coverage for in-patient hospitalization services (that’s called Part A) and another which covers outpatient services like doctors, medical tests, and more (that’s called Part B). Part A is usually free (if you’re getting or will get Social Security), but there is a monthly premium for Part B. For 2023, the monthly Part B premium will be $164.90, and that’s either deducted from your Social Security payment, or paid directly to Medicare if you’re not yet collecting Social Security. 

There are deductibles and copays for both Part A and Part B, so they don’t cover 100 percent of your health-care expenses — they generally cover about 80 percent of specific types of medical services, after deductibles are satisfied. The deductibles aren’t high — $226 for Part B and $1,600 for Part A — but that still leaves you with some uncovered health-care costs under Medicare. And for those uncovered costs, many people choose to get additional private coverage, known as a “Medigap” (or Medicare Supplement) plan, or a Medicare Advantage plan (which is usually called Medicare “Part C”). This additional coverage isn’t mandatory, but usually prudent to have. 

The standard age for enrolling in Medicare is age 65, but if you have other “creditable” health-care coverage from your wife’s employer you can defer enrolling in Medicare until that employer coverage ends or is about to finish. Having that “creditable” employer coverage after age 65 protects you from incurring a late-enrollment penalty for enrolling in Medicare after age 65. From what you’ve written (assuming your employer coverage is “creditable”) you can enroll in Medicare at any time now without a penalty for enrolling after 65. You can enroll online at www.ssa.gov/medicare, or by calling the Social Security Administration at (800) 772-1213. 

Medicare Part A and Part B do not include coverage for prescription drugs. For that, you would need to acquire a private prescription-drug plan (called Medicare Part D), if you wish such coverage after age 65 and after your employer drug coverage ends. Part D plans aren’t usually expensive — in the $15-$50 per month range — depending on the specific plan and drug “formulary” (the amounts the plan pays for each type of drug). To sort all of this out and figure out your best options for additional coverage, you may wish to contact AMAC’s Medicare department (www.amac.us/medicare) and speak with a Medicare insurance specialist. 

To recap, in your personal circumstances you are eligible to enroll in Medicare without penalty, even though you’re now 68, because you have had “creditable” health-care coverage through your wife’s employer since you were 65 (“creditable’’ is a group plan with at least 20 participants). You can also simply stay on that employer plan if you wish, and only enroll in Medicare when your employer coverage ends or is about to end. At that time, you will enter a Medicare special enrollment period, during which you can enroll in Medicare without incurring a late-enrollment penalty. The bottom line? If your current coverage from your wife’s employer is creditable and suits your current needs, you can wait until that coverage ends to enroll in Medicare. The only caveat is that you must take free Medicare Part A if you collect Social Security after age 65.          

Russell Gloor is a national Social Security advisor at the AMAC Foundation, the nonprofit arm of the Association of Mature American Citizens (AMAC). The 2.4-million-member AMAC says it is a senior advocacy organization. Send your questions to: ssadvisor@amacfoundation.org.

Author’s note: This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). The NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity.