So, Your Turning 65: What You Need to Know About Your Medicare Benefits
How time flies. One minute you were playing football with your friends or entering beauty pageants. Then you were a taking the kids to soccer. Then you were marrying off your daughter and your son left for college – you became empty nesters. Grandchildren came and then you were 64-years old. It all feels like yesterday. So, you’re turning 65! Here’s what you need to know about your Medicare benefits.
Few people ever have an issue with qualifying for Medicare. However, there are some who did not manage to work enough quarters and may be in for a surprise. To be fully vested and qualified for Medicare, you must have worked 40 quarters (3 months equal a quarter), or 10 years, paying FICA (Federal Insurance Contribution Act) taxes, which pay for your Medicare benefits and Social Security.
Some professionals take time off to start families or due to health reasons and may have blocks of working quarters that don’t add up to 40, and believe they’ve worked enough. If you’re not sure, check. You don’t want to be caught by surprise and then have to pay either a $259 or $471 premium (depending on how long you or your spouse worked). To check your benefits, go to my Social Security. If you don’t have an account, create one, and you can get all your information.
Great! You learned you have nothing to worry about; you qualified for your benefits. What should you do next? Great question. You want to make sure you enroll in Medicare Parts A and B, within three (3) months before your birthday month. If your birthday is March 21st, you can enroll on December 1st of the previous year.
Actually you have a total of seven (7) months in which to enroll: the three months before your birthday month, plus your birthday month, and three months after your birthday month. While you may have this time, you don’t want to procrastinate. Take the time to get your questions answered. Make sure you understand all your benefits (there are quite a few). This way you can make the best decision, saving you money and providing the most benefits. Then, if for some reason, new information arises and you feel you made the wrong choice, you still have the remainder of that seven-month window in which to change your plan decisions.
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There are some reasons why you may not have enrolled on time:
While some of those circumstances are valid, there is criteria that must be met, or you will receive a lifetime penalty on your Part B and Part D benefits. And depending on how late, it can be a substantial amount.
There are certain circumstances in which you would avoid the Part-B penalty. For more information on those, read Should I get Parts A & B? | Medicare.
The penalty can vary based on your income. However, if you fall in the largest category of beneficiaries, the Part-B premium is $148.50 for 2021 (it goes up annually, hence any penalty would increase annually as well). The Part-D premium for 2021 is $33.06. If you’re qualified, your Part-A premium is covered in full.
The Part-B penalty would be 10% of the monthly premium, for each full 12-month period you did without it. For example, if you enrolled 27-months late, your penalty would be 20% for the first 24 months, added monthly for the lifetime of your benefits. In today’s premium, it would be $29.70 plus the $148.50, for a total of $178.20. Next year’s penalty will be calculated by next years increased premium.
For your Part-D prescription drug benefits, it would 1% for each month you did without it or creditable drug coverage. What that means (in English) is if you had creditable prescription drug coverage provided by another source that matched the benefits of Part-D or were greater, then you won’t get fined. However, once you lose that coverage, you have 63 days in which to enroll, or you will incur the penalty. Using the same example as before, 1% of $33.06 is $0.3306, multiplied by 27 months equals $8.93. So your premium would be $41.99.
Finally, the other choice you must make is whether to stick with Original Medicare and buy a MediGap plan to cover the 20% Medicare doesn’t cover, along with a prescription drug Part-D plan, or get all your benefits managed under one plan with added benefits – this is known as Part C or Medicare Advantage.
Depending on the plan, Medicare Advantage can also provide added benefits like:
This gives you back from $240 to $1200 a year!
There are many options and plans. You want to make sure you look for a 5-star plan in your area, if there are any, before deciding. 5-Star plans have the highest rating for customer service, plan benefits and claims handling that CMS (Centers for Medicare and Medicaid Services) awards. And you won’t pay extra for 5-stars!
If you’re turning 65, make sure you speak with your Medicare Advantage professional and get answers for your specific needs. If you’re in the state of Florida, take our questionnaire and one of our professional and courteous agents will contact you with your FREE information, with no obligation whatsoever.