Health Insurance and Medicare can be tough topics to understand. As you reach retirement, you may begin researching Medicare. One of the first questions you will have is what are the Medicare eligibility requirements.
Medicare is a big benefit for seniors, and you don’t want to miss the opportunity to participate. So how do you qualify and what are the requirements to be eligible for Medicare? Is it only age based? Are there other rules that apply?
In this article, we will walk through every questions you might have about qualifying for Medicare and what you need to do to participate.
History of Medicare
Before discussing eligibility requirements, let’s go through the basic history and coverage of Medicare. This will help you understand the way Medicare works and how eligibility is established.
President Lyndon B. Johnson signed Medicare into law in 1965 to provide medical coverage for seniors over 65. In 1966, Medicare’s coverage took effect, as Americans age 65 and older were enrolled in Part A and millions of other seniors signed up for Part B. Nineteen million individuals signed up for Medicare during its first year. (1)
During the Nixon administration, Medicare was expanded to include people under the age of 65 with long-term disabilities or end-stage renal disease.
In the 1980s, Medigap or Medicare Supplement policies were created to assist with out-of-pocket expenses not covered under traditional Medicare. Hospice care for terminally ill patients was also added.
Medicare Advantage or Part C was created in the 90’s provide other options of coverage for items not covered under Medicare. Add-on benefits such as prescription drug coverage was part of this package.
In the 2000’s, Part D or Prescription Drug Coverage was created.
At the beginning of 2021, 63.1 Million Americans had coverage with Medicare.
Basics of Medicare
There are two major components to Medicare along with two separate and potentially optional parts. The parts of Medicare are designated by Part A, Part B, Part C and Part D.
Part A covers hospitalizations. Part B covers doctors and specialists. Part C is the optional Medicare Advantage plan. Part D is prescription drug coverage.
Following are the details of the essential components of Medicare Part A and Part B.
Medicare Part A
Part A of Original Medicare covers the baseline hospital expenses that most seniors would require.
Part A covers:
- Inpatient care in a hospital
- Skilled nursing facility care
- Nursing home care
- Hospice care
- Home health.
Part A coverage, as with all parts of Medicare, is regulated and controlled by federal and state laws. Local coverage decisions are made by companies in each individual state. The companies authorized to operate in your state decide whether something is medically necessary to be covered.
Hospital care coverage includes any hospital expense critical to your inpatient care. This could include a semi-private room, meals, nursing services, medications, and any other service you would receive from the hospital.
Part A does not cover costs for a private room, unless medically necessary. It also does not cover the cost of blood.
Home health services include part-time skilled nursing, physical, speech or occupational therapy, and medical equipment when ordered by your doctor.
Medicare Part B
Part B covers doctors and outpatient services. It includes preventive services in addition to normal medical services. Clinical research, ambulance services, durable medical equipment, mental health services and outpatient prescription drugs are services available at no cost if Part B recipients get care from a provider who accepts assignment. However, there are potential costs with Part B related to co-insurance and copays.
Medicare Part A will not cost you anything if you paid into Medicare payroll taxes throughout your working career. You will probably pay the Part B premium. Under some circumstances, you may not pay Part B if you are covered under an employer plan or based on income levels.
Beyond premium costs, you need to consider deductibles, co-pays, and co-insurance.
Part A Hospitalization costs:
$1,484 deductible for each benefit period (2021)
Days 1-60: $0 coinsurance for each benefit period
Days 61-90: $371coinsurance per day of each benefit period
Days 91 and beyond: $742 per each “lifetime reserve day” after day 90 for each benefit period (up to 60 days over your lifetime)
Beyond lifetime reserve days: all costs
Part B Medical Insurance Costs:
The standard Part B premium amount is $148.50 per month
Part B deductible is $203.
After your deductible is met, you typically pay 20% of the Medicare-approved amount for most doctor services (including most doctor services while you’re a hospital inpatient), outpatient therapy, and Durable medical equipment (DME)
You will also need to buy a Medicare Part D plan to cover prescription drugs. These plans are sold in the private market and can vary based on what is available in your area.
To cover the extra deductible and coinsurance costs, you can also purchase a Medicare Advantage Plan (Part C) or a Medicare Supplement (Medigap) policy.
What Qualifies You To Receive Medicare?
According the Dept of Health and Human Services, Medicare is available for:
- People 65 years and older
- Younger people with disabilities
- People with end stage renal disease (anyone requiring a transplant or dialysis)
For Part A Medicare, you are eligible for a premium free coverage, if one of the following are true:
- Age 65 or older and you or your spouse worked and paid Medicare taxes for at least 10 years
- You receive or are eligible for retirement benefits from Social Security or the Railroad Retirement Board.
- You or your spouse had Medicare-covered government employment
Most people will not have to pay a premium for Part A, but everyone must pay for Part B if they want it. The monthly premium is deducted from your Social Security check, Railroad Retirement, or Civil Service Retirement check. If you don’t get any of these payments, Medicare sends a bill for Part B every 3 months.
Will the Medicare eligibility requirements change in the future?
Medicare is a constantly evolving program, and there will continue to be changes in the future. Recently, we have seen some politicians advocating raising the Medicare eligibility age above 65. On the other hand, there are proposals to lower the age or even offer Medicare for all.
What if I continue to work past age 65? Will I still qualify?
Yes, you will still be eligible if you work past age 65, but there are reasons you may not want to sign up for Medicare.
It all depends on your employer’s size.
If your employer has more than 20 employees, you can delay enrolling in Medicare until your employment ends or the coverage stops. This will prevent you from incurring any late penalties from enrolling later.
The key to remember is that you must be actively working for the employer, and not just receiving retirement benefits from the employer. It is your choice whether to accept you employer’s plan or enroll in Medicare.
If the employer has fewer than 20 employees, the employer can decide whether to offer health coverage. They are under no obligations for them to provide heath coverage. In that case, you would need to enroll in Medicare.
Can I Get Medicare If I Never Worked?
The reason that Medicare Part A is free for most Americans is because you paid into the program via a tax. While you work, your earning were taxed and paid into the Federal Insurance Contributions Act.
If you worked a total of 40 quarters (or 10 years), you paid into Medicare and will receive Part A premium free.
But what if you didn’t pay into the program, or work enough years, are you still eligible for Medicare under current criteria?
Yes, there are 2 conditions. You can get it free through your spouse if they worked the 10 year period, or if you certain medical conditions or disabilities.
If you don’t have enough work history or meet any of the other conditions, you can still enroll in Medicare. You will have to pay a premium for Part A.
Can I Be Denied Medicare?
Eligibility rules mean you can not be denied Medicare. However, one requirement is that you must enroll in Medicare as soon as you are eligible or you will miss the enrollment window. After that period of time, there are penalties that can be added to your premiums for life.
The only way to postpone enrollment is if you are currently covered with an employer.
You can be denied a Medigap or Medicare Supplement policy. However, if you apply for a Medicare Supplement policy during the initial Medicare enrollment period you are guaranteed coverage. If you miss the enrollment period, a Medicare Supplement company will examine your medical history to determine pricing and eligibility.
Can I Get Medicare Benefits Prior To 65?
Yes you can. If you meet the disability requirements or have late stage renal disease.
If you don’t meet any disability or medical requirements, you must wait till you are 65 to enroll for Medicare benefits.
What Should I do to Participate when I am Eligible for Enrollment?
Enrollment in Medicare should take place during your initial enrollment period. This is a seven-month period that begins 3 months before the month of your 65th birthday and 3 months after.
If you get benefits from Social Security, you will be automatically enrolled in Part A and Part B.
However, if you are over 65 and not already getting benefits from Social Security, you need to sign up to get Medicare Part A and Part B. It will not be automatic.
If you did not enroll during the initial enrollment period, you can enroll in the general enrollment period, which isfrom Jan 1 to Mar 31 each year. You may have to pay a late enrollment penalty for Part A and/or Part B if you didn’t enroll when you were first eligible.
There are reasons some people may postpone enrollment if they have private medical insurance through an employer. If you are thinking about postpone enrollment, make sure you speak to an experienced Medicare agent professionally to weigh through all your options.
Coverage Choices with Medicare Enrollment include Medicare Advantage?
When you enroll in Medicare, there are two ways to receive your coverage. You choose Original Medicare, Parts A & B, or enroll in Medicare Advantage (Part C).
If you choose Original Medicare, you are able to see any doctor in the country that takes Medicare. You can also join a separate Medicare Drug Plan (Part D). Many people will also choose to purchase a Medigap or Medicare Supplement policies to pick up the out-of-pocket costs that Medicare does not cover.
You can also receive your coverage through Medicare Advantage (Part C). Medicare Advantage is an all-in-one coverage. This plan bundles Part A, Part B, and sometimes Part D. Plans will often have lower out-of-pocket costs than Original Medicare. Medicare Advantage does restrict you to coverage via specific health care providers. Because of the network requirements, Medicare Advantage plans are not available everywhere.
What If I Need More Coverage than Medicare Provides?
This is a common question we get. Original Medicare is a tremendous medical benefit to U.S. seniors. However, there are out-of-pocket costs that are not covered by Medicare. Co-payments, deductibles, and excess charges have to be paid by individuals.
Medicare supplement policies were created by the federal government as a way to help individuals pay for those out-of-pocket costs.
If you are interested in how Medicare Supplement policies work, see our Basics on Medicare Supplement policies.
Is there Medicare Coverage Outside the United States?
In most situations, Medicare will not pay for health coverage outside the United States. If you travel internationally, you will need to find coverage to protect yourself from medical emergencies while out of the country. There are 2 ways to cover medical needs outside the US. First, you can purchase temporary travel insurance. Second, if you have a Medicare Supplement policy, coverage is extended outside the US for certains plans.
What if I Lose My Medicare Card?
Once enrolled in Medicare, you will receive a Medicare card as proof of insurance to display to healthcare providers. This card is necessary to receive coverage. Unfortunately, things get lost.
If you misplace your Medicare card, there is no need to panic. You request a replacement card with your my Social Security account. It takes about 30 days to arrive in the mail once requested.
You should now have a basic understanding of Medicare coverage and Medicare eligibility. Make sure you enroll as soon as eligible. If you have other coverage in place when you enter the Initial Enrollment Period, make sure you talk with a Medicare professional to understand your options. You want to make sure you are covering everything your current health insurance provides you.
These options are affordable and can provide more value than you are receiving with a private policy.
To speak with an agent at Medicare Nationwide, contact us and we can help with your Medicare decisions.
Prefer to chat by phone? Give us a call at 1-833-309-2125.
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