4 Medicare Myths

Medicare, enacted into law in 1965 as a provision of the Social Security Act in that year serves more than 46 million seniors and disabled people today in the United States.  A federal health program that provides health insurance coverage to people aged 65 and over, many people have had many misconceptions surrounding its process and purpose.  Last years healthcare reform law (Patient Protection and Affordable Care Act)…have added confusion among many Americans as to what Medicare provides and how its services works.  Here, we provide 4 common Medicare misconceptions:

  1. Medicare works like private health insurance

Unlike being denied for coverage by most private health insurers, Medicare beneficiaries cannot be rejected for health coverage because they’re too sick, and would not be charged for higher premiums based on health status.  However, high-income earners would pay higher premiums for Medicare Part B, and Part D, which covers prescription drug costs.

2. Medicare coverage is free and cheap

Under healthcare reform, this year marks the first time beneficiaries can get annual wellness checkups and preventive screenings for free…in order to lessen serious illnesses in the future.  Other than that, beneficiaries still have to pay premiums, copays, coinsurance, and deductibles.  As an example, you’ll have to meet a deductible–$1,132 for 2011–before Part A coverage kicks in for hospital stays of up to 60 days.  In addition, this year will see high income earners with Part D coverage facing a surcharge ranging from $12 to $69 per month, depending on income.

3. Medicare covers everything

The answer is No.  Services such as routine dental care, eyeglasses or hearing aids does not come along with traditional Medicare.  An option for these services is to go with a Medicare Advantage Plan, which is run by a private insurer, and typically offers additional benefits.

4. You can sign up for Medicare at any time

To become a beneficiary, one must consider if they’re getting health insurance as an active employee through an employer.  It would make sense to delay signing up for Medicare in order to avoid paying premiums on coverage one does not yet need.  For best practices, it’s good to know when enrollment begins and when it ends.  Planning accordingly in terms of your finances and budgets is always recommended.  Delaying enrollment, as a consequence, may result in a waiting period, during which you will be uninsured.

If you’re unsure as to when to sign up for Medicare, ask your human resources department or visit http://www.medicare.gov/ for detailed and accurate information.

Credit source: Four Medicare Misconceptions by Kristen Gerencher, WSJ.com (2/20/11).

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