2014 Medicare and Medigap Updates
Everyone who seriously cares about their retirement years should take time in understanding Medicare and all its vagaries. To be honest, Medicare is a rather simple system that anyone can grasp within a few minutes. Given that being able to participate in Medicare can significantly help any senior enjoy their retirement without having to worry about their medical expenses, no effort should be spared in understanding Medicare and all its inherent complexities.
To put things simply, Medicare is the government-sponsored plan designed to provide seniors with a system that can take care of their Medical needs. While still working, seniors set aside a portion of their monthly income into a fund that becomes their Medicare contribution. Likewise, employers match this amount so that the actual contribution of any employee per month is twice the amount that comes out of their paycheck.
Once a retiree or senior turns 65, their retirement fund is activated and they can start drawing a monthly check based on lifetime contributions. This is done either through automatic enrolment when a senior is eligible for a Social Security benefit or supported by the Railroad Retirement Board. The Medicare benefits for a senior becomes available on the first day of the month that the policy owner turns 65.
The exact benefits that Medicare offers are broken down into Medicare Part A, Part B and Part D. Part A covers hospital insurance which refers to inpatient care in hospitals. Part B is for medical insurance and particularly geared towards footing bills for doctor services. Those who automatically qualify for Medicare are typically eligible for Part A and Part B coverage.
Part D, on the other hand, is for prescribed medications and requires extra enrolment on the part of the policy owner. It is not automatic and must be added as a paid extra benefit by Medicare providers. This part is important in understanding Medicare because many policy owners who are not aware of the way the system works are actually caught off guard with Part D coverage.
Beyond the automatic eligibility or the need for enrolment into Part D on an as-needed basis, Medicare is a straight-forward system. Policy owners pay a premium per month on part B or D depending on their exact coverage. Medicare foots medical bills as defined by the specific policy.
A variety of agencies are open to answering questions to facilitate would-be or current policy owners in understanding Medicare. A few of these help lines include 1-800-Medicare, the State Health Insurance Assistance Program (SHIP) whose numbers can also be retrieved from 1-800-Medicare, the Social Security helpdesk at 1-800-772-1213, the Department of Health and Human Services, the Department of Veteran Affairs, the Office of Personnel Management for federal employees, and the Railroad Retirement Board. All of these agencies are on standby 24 hours a day to help policy owners in understanding Medicare related questions and allow them to avail of the benefits due them as smoothly as possible.
There is no more appropriate time than now to dive deep into understanding Medicare so it can best serve the purpose that it was designed to do. In that regard, even those who are still working should begin to start research and learning the importance of Medicare as a tool for planning one’s future well in advance.
Unfortunately, though it is a giant plus for seniors, Medicare only covers around 80% of medical bills. For this reason most choose to take out a Medigap supplement policy to protect their savings against a long term illness.