Ashford Insurance

Explanation of How Medicare Works

Ashford Insurance

Medicare Insurance Made Easy

Medicare eligibility

If you’re a U.S. citizen or have been a permanent legal resident for at least five years, your Medicare eligibility starts at age 65 provided you meet these requirements:

  • You or your spouse worked enough years to be eligible for Social Security or Railroad Retirement benefits.
  • You or your spouse is a government employee or retiree who has not paid into Social Security but has paid Medicare taxes.

Certain individuals under 65 are eligible for Medicare as well — namely:

  • Anyone who’s permanently disabled and has received disability benefits for at least two years.
  • Those with end-stage renal disease (ESRD).
  • Those with ALS (Lou Gehrig’s disease).

If you meet the necessary criteria, you can sign up for Medicare at the start of your initial enrollment period, which is a seven-month period that begins three months before your 65th birthday.

This is how Medicare works:

Original Medicare is health coverage managed by the federal government. Generally, there is a cost for each service. In most cases, you can go to any doctor, other health care provider, hospital, or another facility that is enrolled in Medicare and is accepting new Medicare patients. With a few exceptions, most prescriptions are not covered by Original Medicare. However, you can add drug coverage by joining a Medicare Prescription Drug Plan (Part D). With Original Medicare, you do not need to choose a primary care doctor. In most cases, with Original Medicare, you don’t need a referral to see a specialist, but the specialist must be enrolled in Medicare. You may already have employer or union coverage that may pay costs that Original Medicare does not. If not, you may want to buy a Medicare Supplement Insurance (Medigap) policy. Alternatively, you may wish to get a Medicare Part C, or, Medicare Advantage Plan.

Medicare has four basic forms of coverage:

• Part A: Pays for hospitalization costs

• Part B: Pays for physician services, lab and x-ray services, durable medical equipment, and outpatient and other services

• Part C: Medicare Advantage Plan (like an HMO or PPO) offered by private companies approved by Medicare

Part D: Assists with the cost of prescription drugs

Medicare enrollees who have limited income and resources may get Extra Help paying for their premiums and out-of-pocket medical expenses from Medicaid (e.g. MSPs, QMBs, SLBs, and QIs).

Enrolling in Medicare

Some people have enrolled in Medicare automatically, while others need to sign up. If you fall into the latter category and fail to sign up during your initial enrollment period, you may be hit with a penalty. If you miss your initial enrollment period, you’ll be able to sign up during the general enrollment period, which runs from Jan. 1 to March 31 each year.

You’ll be enrolled into Medicare Parts A and B automatically if you’re already receiving Social Security or Railroad Retirement benefits, in which case your Medicare benefits will kick in on the first day of the month you turn 65. If you’re under 65 and disabled, you’ll also be automatically enrolled in Parts A and B if you’ve got Social Security or Railroad Retirement disability benefits for 24 months. And if you have ALS, you’ll start getting Parts A and B the month your disability benefits begin.

Next, learn more: How to Enroll in Medicare