According to the Kaiser Family Foundation, Medicare provides health insurance to more than 65 million people — or roughly one in every five Americans. Medicare spending accounts for 20 percent of all national expenditures on health care and 12 percent of the total United States budget.
Despite the government’s best intentions, signing up, picking the right plan and simply understanding the myriad rules, exceptions and costs of this sprawling program is nothing short of mind-boggling. Moreover, even if you’re enrolled, changes to Medicare plans happen constantly. As many as 70 percent of Medicare beneficiaries never review or compare plans during Medicare Open Enrollment Periods — potentially costing them money and the loss of coverage.
If you’re closing in on 65 or preparing to review your 2024 options, your best bet to ensure you’re choosing the right plan for your needs is to work with a broker — preferably someone a trusted friend or family member has had experience with.
Medicare Brokers Work for You, Not Insurance Companies
A Medicare broker essentially works for you, not a specific insurance company. They are real, licensed agents. They must retain an insurance license and go through extensive training and certifications to be licensed with the insurance carriers they represent. They go through certifications every year, so they stay up to date with any industry changes. Sure, a broker gets paid by the different insurance companies, but they don’t have a specific loyalty to one company over another. Moreover, the rates you pay are the same – no markup for their services.
Their goal is to delight you with their service and the product or plan they put you with. And if you call your broker in 2, 3 or 10 years down the road and ask them to confirm you’re still in the right plan, they will gladly help you compare other options and see if there is a better one available. If you sign up through an insurance company, you won’t have that option. And if you sign up through a local, captive agent that sells one company only, you won’t have that option. They work for the insurance company; their interests mirror those of the insurance company, not yours.
6 Essential Medicare Facts
- Turning 65 soon? Initial enrollment begins three months before the first day of the month of your 65th birthday and ends four months after your birthday month. Even if you have private health insurance through your employer, you need to enroll in Part A (hospital insurance) and Part B (medical insurance), or else you’ll pay a monthly penalty for the lifetime of your Medicare coverage.
- There are four parts of Medicare:
- Part A: Inpatient hospital care, home health, nursing facilities, hospice. Part A insurance is typically free.
- Part B: Doctor visits, diagnostic and preventive care, lab tests, mental health care. The premium for Part B is a standard $164.90 a month, which is usually deducted from your Social Security check.
- Part C: Medicare Advantage private insurance. Costs vary based on your plan choice.
- Part D: Prescription drug coverage either through a private insurer or a Medicare Advantage plan. Costs vary based on your plan choice.
- What’s the difference between Medigap (Medicare supplement) and Medicare Advantage?
- Medigap is a supplement to Original Medicare that “fills in the gap” for care, such as Medicare Part D (drugs). You can go to any doctor who accepts it. It doesn’t cover vision, dental or hearing care, although you can purchase supplements.
- Medicare Advantage is private insurance that usually offers drug coverage (Part D) as well as other benefits, such as routine hearing, vision and dental services. Medicare Advantage plans typically have network restrictions and require referrals to see specialists.
- If you’re still working after 65 and don’t have drug coverage, sign up for Part D with your initial enrollment. If you don’t, you likely pay a monthly late enrollment penalty as long as you have Medicare drug coverage.
- If you’re still working after 65, understand how your employer’s health insurance will work with Medicare. This will help you avoid costly penalties that will last throughout the lifetime of your Medicare coverage.
- If you’re already enrolled in Medicare, annual open enrollment is between Oct. 15 and Dec. 7 every year. If you don’t intend to make any changes to your plans, you don’t need to do anything.
The best way to buy Medicare and its ancillary products is the same way you would buy a house: very thoughtfully. Start your journey at Medicare.gov for detailed information about how Medicare works, then consider a good Medicare broker to do the legwork for you.