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It’s important for you to know that Original Medicare covers only about 80% of your eligible expenses.
You are responsible for the rest.
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The Basics of Medicare
There are four parts of Medicare. Knowing how each works can give you more confidence as you start your Medicare journey.
The Basics of Medicare
Knowing the basics of Medicare can help you choose the right coverage. And you’ve already taken an important first step. You’re here. You’re also not alone. As your health coverage provider, we can help make your transition to Medicare easy – when you’re ready.
Meanwhile, here’s some information that can help you prepare.
What is Medicare?
Medicare is the government health care program designed for people age 65 and over. Most U.S. citizens earn the right to enroll in Medicare by working and paying their taxes for a minimum of 10 years. Under certain circumstances, people under 65 may be eligible for Medicare.
Keep reading to learn about the different parts of Medicare, including what is covered and what is not.
The Four Parts of Medicare
Medicare consists of four Parts — A, B, C, and D. Each part helps cover specific services.
SPEAKER 1: You know, Victor is starting to look into learning about Medicare.
SPEAKER 2: Good for him. I haven't thought about it yet, but I have a couple of years to go. Honestly, I know I need to think about it for the future, but I'm kind of clueless about it.
SPEAKER 1: There are some important things to learn, but basically, Medicare is a government health care program for people 65 and older as well as some younger people who have certain disabilities or conditions. When I think of Medicare, I think of the alphabet. You can choose from Part A, B, C, or D to make the plan combination that works for you and your care needs.
SPEAKER 2: You have to be 65 to get Medicare, but do you have to get it right when you turn 65?
SPEAKER 1: You can when you become eligible at 65, but you don't have to enroll right away if you don't plan on retiring yet and can get health insurance through your employer.
SPEAKER 2: Did you sign up right away?
SPEAKER 1: I enrolled right before my 65th birthday because it lined up with my retirement. I don't have to pay a premium for my Medicare Part A. I also signed up for Part B and Part D at the same time to avoid paying penalties for late enrollment. [LAUGH] You know I hate paying extra.
SPEAKER 2: Yes, you do.
[LAUGHTER]
It sounds like I should start prepping soon. When did you start planning?
SPEAKER 1: I began researching when I was 63, maybe earlier, but you know I do like to plan. [LAUGH] Why don't you get started now, Sarah?
[MUSIC PLAYING]
Original Medicare (Parts A and B)
Original Medicare is the coverage most people think of when they use the term Medicare. It consists of Medicare Part A (hospital coverage) and Part B (medical coverage).
Part A (hospital coverage) includes:
- Inpatient care in a hospital
- Care at a skilled nursing facility after a hospital stay
- Some home health care and hospice care services
Most people do not pay a premium for Medicare Part A. Because of this, you should consider enrolling in Medicare Part A when you turn 65, even if you plan to keep working. But first, find out if your workplace offers a Medicare plan for retirees.
Want to know more about Medicare Part A?
Part B (medical coverage) includes:
- Services from health care providers outside of a hospital
- Most outpatient care, including emergency room, lab, and other medical necessary services
- Durable medical equipment like walkers, diabetes supplies and other needs prescribed by your doctor
- Preventive services, including a one-time “Welcome to Medicare” preventive provider visit. Plus some vaccines, health screenings and more
Most people pay a monthly premium for Medicare Part B. This is usually deducted from your Social Security benefit. You’ll have a limited time to enroll in Medicare Part B when you retire. After that, you may have to pay a late enrollment penalty.
If you are covered by a High Deductible Health Plan and have a Health Savings Account, signing up for either Part A or Part B while still employed may prevent you from adding funds to your HSA, so make that decision carefully.
Want to know more about Medicare Part B?
One of the most important things you need to know is that Original Medicare does not cover all of your eligible Part A and Part B expenses. And it doesn’t include prescription drug coverage. You are responsible for paying the costs not covered by Original Medicare.
That 20% can really add up. Which is why many Medicare beneficiaries consider options that provide extra health and wellness benefits and cover more out-of-pocket costs.
Remember, you’re already our valued member. So we’ll be here throughout your Medicare journey to answer your questions and help you prepare. When you’re ready, we can help you get the additional coverage you’ll need.
Want to know more? Check out these articles:
The Other Parts of Medicare
Coverage that goes beyond Original Medicare
In 2003, private health insurers were approved by Congress to offer Medicare benefits. Their plans are known as Medicare Advantage plans, or Medicare Part C. Medicare was also expanded to include a prescription drug benefit called Part D.
Part C and Part D help you avoid some of the out-of-pocket costs Original Medicare doesn’t cover. And they can help make it easier to coordinate your care. So it’s good to consider these valuable options as you start thinking about Medicare.
These important parts of Medicare are provided by companies with a Medicare contract, such as Blue Cross and Blue Shield of Montana.
Part C (Medicare Advantage Plans)
Medicare Advantage bundles your Original Medicare benefits – plus some important extras – in a convenient all-in-one plan.
These Medicare Advantage plans:
- Usually include Part D prescription drug coverage
- May include additional benefits such as vision, dental, and hearing coverage
- May have a $0 or low monthly premium
- Place a limit on your out-of-pocket costs not covered by Original Medicare each year
- May offer a dedicated network of doctors and hospitals in your area. Some give you the flexibility to choose your own doctors.
You may enroll in Medicare Part C and Part D only during certain periods, including when you first become eligible for Medicare.
Want to know more about Medicare Advantage? Check out these helpful articles:
Part D (Prescription Drug Coverage)
Medicare Part D helps cover the costs of outpatient prescription drugs. It may also pay for some services that Original Medicare does not cover.
Medicare Part D prescription drug coverage is:
- Not included with Original Medicare
- Provided by companies with a Medicare contract, such as Blue Cross and Blue Shield of Montana
- Available as a standalone plan – or may be included with a Part C Medicare Advantage plan
To be eligible for Part D prescription drug coverage, you must qualify for Part A and/or be enrolled in Part B. If you don’t enroll in Part D when you are first eligible, you may have to pay a penalty if you decide you want this important coverage later.
Want to know more about Medicare Part D? Check out these helpful articles:
Medicare Supplement Insurance Plans
Another option for additional coverage and savings
Medicare Supplement Insurance Plans (also known as “Medigap”) are designed to fill some of the gaps in Original Medicare coverage. They help cover your portion of the out-of pocket costs Original Medicare does not pay.
With a Medicare Supplement Insurance Plan, you have the freedom to choose your doctors, hospitals, and other providers. And you can enroll in a Medicare Supplement Insurance Plan without waiting for a specific enrollment period.
You can enroll in Medicare Supplement Insurance Plans at retirement after you have enrolled in Medicare Part A and Part B.
Medicare Supplement Insurance Plans do not include prescription drug coverage, so many people pair it with a standalone Part D prescription drug plan.
Blue Cross and Blue Shield of Montana offers a range of Medicare Supplement Insurance Plans to fit a variety of needs.
Understanding the A, B, C & D of Medicare is an important start to your Medicare journey. Stay with BlueSM for more information and important insights every step of the way.
IMPORTANT: If you are eligible for a Retiree Group Medicare plan, some of this information may not apply to you. Please ask your employer or benefit administrator about your Medicare options, eligibility and enrollment information.
Get Your Medicare Timeline
Answer a few simple questions and we’ll provide you with a personalized timeline. You’ll also receive reminders with important information and actions you can take to stay on track as you near your Medicare eligibility.
Create My Timeline →Questions? Let us help.
As our valued member, you have access to exclusive resources and assistance. We’re here to help make a smooth transition to Medicare. Call us to learn more.
1-800-000-0000 (TTY 711)We’re open between 8:00 a.m. – 8:00 p.m., local time, 7 days a week. If you’re calling from April 1 through September 30, alternate technologies (for example, voicemail) will be used on the weekends and holidays.