This comprehensive guide explains the various Medicare options, including Original Medicare, Medicare Advantage, Part D, and Medigap plans. It details different plan types, eligibility, costs, and how to choose the best coverage based on individual healthcare needs. Understanding these options can help seniors make informed decisions for their healthcare in retirement.

Understanding Medicare Plan Choices

Contributions during your working years for Social Security and Medicare taxes can provide valuable benefits in retirement. When you turn 65, you usually qualify for Medicare Part A and Part B automatically.

There are multiple Medicare options to explore, including Original Medicare, Medicare Advantage, Part D, and Medigap plans.

Original Medicare is a federal program offering hospital coverage (Part A) and medical coverage (Part B).

Medicare Advantage (Part C) provides an alternative through private plans that combine Part A and Part B, often with additional benefits.

Medicare Advantage plans, also called Part C, bundle Original Medicare benefits and may include extra perks.

Some plans incorporate prescription drug coverage (Part D).

Types of Medicare Advantage Plans

Health Maintenance Organization (HMO)

HMO Point-of-Service (HMO-POS)

Preferred Provider Organization (PPO)

Private Fee-for-Service (PFFS)

Special Needs Plans (SNP)

Medical Savings Account (MSA)

Finding the Best Plan for Your Needs

HMO: Local network-focused; out-of-network visits require referrals and may cost more.

HMO POS: Similar to HMO but allows some out-of-network visits at increased costs.

PPO: Greater flexibility to visit out-of-network providers; higher premiums; no referral needed.

PFFS: Sets its own rules; can see out-of-network providers; specialists can be contacted directly.

SNP: Suited for specific chronic conditions or residents of specialized facilities; includes prescriptions.

MSA: Funds placed in a savings account for services; high deductible; no prescription coverage; unused funds roll over.

Part D for Prescription Drugs

Original Medicare doesn't cover medications; enrolling in Part D or a plan with drug coverage is essential to lower medication costs.

Medicare Premiums in 2018

Part B premium is $134; higher-income individuals may pay more.

The average Part D premium is about $34 monthly.

Premium costs vary based on plan and provider choices.

Medigap Insurance (Medicare Supplement)

Medigap plans assist with out-of-pocket expenses like copays and deductibles.

Coverage includes coinsurance, deductibles, and copayments for outpatient services.

Note: Medigap isn't compatible with Medicare Advantage plans.

Assess your healthcare needs carefully, considering prescription drug coverage and out-of-pocket costs, to select the most suitable Medicare plan.