Your 4 Choices
You know all about Original Medicare Part A and Part B. Let’s say we’re all signed up for Original Medicare Part A and B and we’re all ready to go. Now we need to know what to do next to solve several problems.
Problem #1: There is no limit or cap or ceiling to the health expenses one might incur from year to year. Yes, we’ll get help to pay health care expenses but is there any end to health care expenses from year to year?
Problem #2: We do not have any coverage for drugs. There are some medical conditions that make it necessary to have drugs that can cost up to thousands and thousands of dollars every month. Uh oh!
Problem #3: Decisions, Decisions, Decisions. There’s not much to the decision of signing up for Medicare Part A and Part B. But now you’ve come to the big choice. Should I go with keeping Original Medicare and adding a Medicare Supplement and a Medicare Prescription Drug Plan or go with a Medicare Advantage plan. Here’s a picture for you.
1) Original Medicare Part A & Part B*
1) Original Medicare Part A & Part B* and
1) Original Medicare Part A & Part B* and 2) Medicare Supplement and
1) Medicare Part C (Medicare Advantage plan which includes Medicare Part A & Part B*
*There is a short term penalty if you don't enroll in Part B when first eligible and then later decide you want Part B.
**There is a lifetime penalty if you don't choose a PDP when first eligible and then later decide you want a PDP.
^Medicare Advantage plans are offered with Part D (MAPD) and without Part D (MA). Beneficiaries who choose plans without Part D will usually get their medications from the Veterans Administration or TRICARE or from some other source that is deemed to be "creditable coverage" which means drug coverage that is at least equal to or better than Medicare Part D. If you opt not to have Medicare Part D because you have creditable coverage you are exempt from the Part D lifetime penalty.
Short Summary of each choice:
Presuming you’ve already gone through our discussion on Original Medicare Part A and B, not having Medicare Part A and B, if you’re eligible, is not a smart thing. It’s possible to go without Medicare Part A and Part B but you would have no health coverage as a senior or a disabled person. Remember that for the vast majority of people qualified for Medicare, the cost for Part A will not apply (because most people have worked at least 40 quarters and paid Medicare taxes during their lifetime) and for Part B will be currently $144.60 per month.
Original Medicare Part A and B is a good thing but if this is all you have, you could find yourself paying out of pocket for a lot of medical bills. Most beneficiaries will want to fill in the “holes” that Medicare A & B does not fully cover.
The most obvious hole to fill is drug coverage. To take care of this problem you’ll want a Medicare Prescription Drug Plan (PDP).
The next step is to fill the holes left by the Original Medicare Part A and Part B which includes deductibles and co-insurance. Adding a Medicare Supplement plan to your Medicare Part A, Part B and Part D will do this fairly efficiently. Medicare Supplements have a monthly premium and will help cover some medical expenses incurred. Your premium for a Medicare Supplement will vary depending on how much you want to have your medical expenses covered like a little bit or a lot.
Another choice is to simply go with a Medicare Advantage plan that bundles your Medical coverage's into one plan sold by a private insurance company that deals in Medicare Advantage plans.
To conclude most Medicare beneficiaries will choose either Original Medicare A & B with a Medicare Supplement and a PDP, or they will choose a Medicare Advantage plan (MAPD or MA).