How Does Medicare Work?
Medicare is a federal health insurance program designed primarily for people age 65 and older, as well as certain younger individuals with disabilities. There are different parts of Medicare that cover specific services.
Understanding Original Medicare
Original Medicare is a fee-for-service plan managed by the federal government. This means you’re charged a fee each time you receive a healthcare service.
Key Features:
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Use your red, white, and blue Medicare card to receive services.
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Access any doctor, hospital, or facility that accepts Medicare and is taking new patients.
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Optional supplemental coverage is available to help with out-of-pocket costs.
Additional Coverage Options
You may choose to add coverage through private insurers:
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Medicare Supplement Insurance (Medigap): Helps pay costs that Original Medicare doesn’t cover.
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Medicare Advantage Plans (Part C): Offers Medicare benefits through private insurers. These often have $0 monthly premiums but may:
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Have higher deductibles
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Require you to use in-network providers
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What Does Medicare Cover?
Medicare covers a wide range of services and supplies in medical settings such as hospitals and doctor’s offices. These are generally divided into:
Part A – Hospital Insurance
Covers:
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Inpatient hospital stays
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Skilled nursing facility care
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Hospice care
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Some home health care
Costs for Part A:
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Premium: Usually free if you or your spouse paid Medicare taxes while working.
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If not, you can buy Part A (up to $471/month).
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Deductible: $1,556 per benefit period
Part B – Medical Insurance
Covers:
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Doctor visits
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Outpatient care
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Preventive services
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Durable medical equipment
Costs for Part B:
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Premium: Starts at $158.50/month (varies by income)
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Deductible: $158.50 per year
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Coinsurance: Typically 20% of Medicare-approved amounts
When to Enroll in Medicare
Enrollment depends on your circumstances. Some people are enrolled automatically, others must sign up manually.
Automatic Enrollment
You’ll be automatically enrolled in Part A (and Part B, if elected) if:
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You're receiving Social Security or Railroad Retirement Board (RRB) benefits
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You’ve received disability benefits for 24 months
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You have ALS (Lou Gehrig’s disease)
Enrollment Periods
If you’re not automatically enrolled, you can sign up during:
| Enrollment Period | Description |
|---|---|
| Initial Enrollment | 3 months before to 3 months after your 65th birthday |
| General Enrollment | January 1 – March 31 (coverage starts July 1) |
| Special Enrollment | If you have employer coverage through you or your spouse |
Late Enrollment Penalties
Part B Penalty: If you don’t enroll when first eligible and don’t qualify for a special enrollment, your premium may increase by 10% for each full 12-month delay.
Breakdown of Part B-Covered Medical Expenses
| Service | What You Pay |
|---|---|
| Blood (first 3 units) | Must pay or replace unless free from a blood bank |
| Lab Tests | $0 for Medicare-approved services |
| Home Health Care | $0 for services, 20% for durable medical equipment |
| Doctor Services | 20% of Medicare-approved amount |
| Outpatient Mental Health | 20% of Medicare-approved amount |
| Outpatient Hospital Services | Copay or coinsurance (varies by service, but cannot exceed inpatient deductible) |
Need Help Choosing a Plan?
You can purchase Medicare Supplement Insurance or a Medicare Advantage Plan through this website. Consider your healthcare needs, budget, and provider preferences before choosing the right plan.
Still Have Questions?
Check out our related articles or contact our Medicare support team to speak with a licensed advisor.