When you think about retiring, are your thoughts filled with plans for more time with grandchildren, travel and maybe an occasional afternoon nap?
Changing your health insurance probably won’t cross your mind until the letters and emails start coming with all kinds of coverage options around your 64th birthday. Turning a certain age doesn’t mean you automatically have to retire – but if you’re considering it, here are a few things to think about.
Can you continue your employer-sponsored health insurance after retirement? Or will you be added to your working spouse’s insurance plan? If no is your answer to these questions, you will need to enroll in the federal government’s Medicare program and find the best Medicare insurance plan for you.
Medicare is a basic health insurance program from the federal government for people who are 65 or older. It’s made up of these parts:
- Part A covers hospital stays, care in a nursing facility, hospice care and some home health care.
- Part B covers certain doctors’ services, outpatient care, medical supplies and preventive services.
- Part D adds prescription drug coverage.
Medicare does not cover all medical costs, like long-term care, dental care, eye examinations for glasses, dentures, cosmetic surgery and hearing aids. And even if Medicare covers a service, you will likely pay a deductible, coinsurance and copays.
Many retirees enroll in Medicare Advantage or Medicare Supplement insurance plans to meet their needs.
Medicare Advantage plans, also known as Part C, provide an alternative to Original Medicare. They offer Parts A and B services and often include additional benefits that Medicare doesn’t cover, such as vision, hearing, dental and certain health and wellness programs.
Most Medicare Advantage plans include prescription drug coverage (Part D) in the plan for one low premium. You must have and maintain enrollment in Medicare Parts A and B to enroll in a Medicare Advantage plan.
Medicare Advantage plan premiums are the same regardless of age or health status and usually have lower deductibles and copays than Original Medicare. Medicare Advantage plans include a maximum out-of-pocket limit and are offered by private health insurance companies covering the same benefits as Original Medicare and more.
Medicare Supplement plans, also known as Medigap, are standardized, meaning that the supplemental plans are the same from carrier to carrier. For example, “Plan G” Medicare Supplement offered by one private health insurance company will pay the same benefits as the “Plan G” Medicare Supplement offered by another company.
The only differences between plans are the premiums charged by each company and any “value added” programs and services they might offer to their customers. Examples could include discount programs for vision and hearing and gym memberships.
Medicare Supplement plans do not include prescription drug coverage, so enrolling in a Prescription Drug Plan through a private health insurance company can help you manage prescription drug costs.
If you are just starting to think about retirement, you are not alone. As always, Blue Cross and Blue Shield of Nebraska is here to help review Medicare options with you. For more information on plans available in your area or to contact a local agent, visit Medicare.NebraskaBlue.com.
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