Although Medicare can help you cover certain healthcare costs, it's a very complicated system to navigate, and many people roll their eyes when they think about the hassle of navigating any insurance program. One solution for navigating this process is to consult with a Medicare advisor who can help you determine whether or not you are eligible for Medicare benefits. However, it's important to do your own research, and sometimes the best place to start is learning what not to do.
Here are five common mistakes people make when it comes to Medicare.
1. Leaving Your Job and Missing the Deadline for Medicare Enrollment
Are you 65 and still working? If so, you might be receiving health insurance coverage from your employer. If that's the case, you might not have to sign up for Medicare, which allows you to avoid the premiums of Part B. However, if you happen to leave your job, that means you must enroll within eight months or you will have to wait for the next period of enrollment, which could mean going without coverage for several months and perhaps having to pay penalties.
By the way, not all employer plans are superior to Medicare, so make sure you compare them.
2. Not Signing up for Medicare Because You’re Not Getting Benefits From Social Security
Are you receiving benefits from Social Security? If you are, you may already know you are automatically signed up for Medicare Parts A and B once you turn 65. However, if you’re putting off filing for Social Security benefits until you are at retirement age or even later, you need to sign up for Medicare on your own. That means that you have to sign up within a seven-month window. This will be three months before the month of your 65th birthday and up to three months after that month. Since Part A is free for most, there’s no reason to wait to file. (For related reading, see: When You Can and Can't Delay Enrolling in Medicare.)
3. Thinking Your Medical Providers Will Always Have Coverage Under Your Medicare Advantage Plan
The Medicare Advantage (MA) plan can cover medical expenses and prescriptions. However, to get the lowest co-payments possible, you might need to use the network of doctors and hospitals on the plan. Make sure your hospitals, doctors and healthcare providers are covered every year. If necessary you can switch your plan from October 15 to December 7, the period of open enrollment. You can use a Medicare plan finder to find the right plan for you. Sign up at www.medicare.gov to compare plans in your area and the costs associated with each plan. Contact an insurer and your doctor once you’ve narrowed the list to a few plans to make sure they’re in the network for the upcoming year.
4. Selecting the Wrong Medigap Policy
Buying a Medigap policy within six months of signing up for Part B means you can get any plan available in your area, even if you have a pre-existing medical condition. If you want to switch plans after that, a lot of insurers might reject you or even charge you more due to your condition, so it’s important to select a plan wisely.
5. Not Getting Part D
Medicare Part D covers prescription drugs. Review your options during open enrollment, as cost and coverage can change every year. Look for increases in your share of costs or premiums. If you can now use generic drugs or have gotten new meds, switching plans might mean a better deal.
Medicare decisions are complex. Unfortunately, insurance agents and government resources often increase the complexity. Medicare decisions, actually all retirement healthcare and custodial care decisions, are best made in the context of an overall retirement income plan.
(For more from this author, see: How Working Affects Your Social Security Benefits.)