Medicare: 10 Essential Facts You Must Know

1. Medicare Is Vital to Older Americans.

• Almost 45 million recipients age 65 or older.

• Almost 9 million disabled beneficiaries.

• Includes both hospital and supplemental medical insurance.

54 million Americans were enrolled in Medicare, according to latest available data.

Source: Medicare.gov.

2. You Can Qualify for Medicare in Several Ways.

• Workers with 40 credits – usually representing 10 years of work – can qualify.

• Spouses can qualify on a worker’s record.

• Those with fewer work credits can pay monthly premiums for their Part A hospital insurance.

Workers usually get eligibility for Medicare by earning work credits.

Source: DavidYork71 and Mike Gravel, via Wikimedia Commons.

3. Medicare Covers Several Types of Expenses.

• Part A covers hospital and inpatient care.

• Part B covers doctor visits and services for medically necessary or preventive care.

• Part D covers prescription drug costs.

Medicare is a multifaceted healthcare program that pays for many different types of services.

Source: Medicare.gov.

4. Traditional Medicare Isn’t Your Only Option.

• Combines hospital and medical coverage, with optional drug plans included.

• Private insurance companies offer these plans.

• Additional costs can apply depending on level of coverage.

Medicare Advantage Plans provide an alternative to traditional Medicare coverage.

Source: 401(K) 2013 on Flickr.

5. Medicare Taxes Have Risen Over Time.

Source: Medicare. Figures reflect 0.9% Medicare surtax collected on income tax return.

6. So Have the Wages Taxed by Medicare.

Source: Medicare. Note: After 1993, the wage base for Medicare taxes became unlimited.

7. Medicare Is Facing a Tough Financial Situation.

• The Medicare Hospital Insurance Trust Fund is projected to run out of money in 2030.

• Once that happens, additional spending from the general U.S. budget will be necessary to cover benefits. Source: TheeErin via Flickr.

Part of Medicare’s funding comes from a trust fund funded with payroll taxes.

8. Medicare Has Enrollment Deadlines.

• Initial enrollment runs from three months before your 65th birthday to three months after.

• Special enrollment applies if you lose group-plan coverage, usually by retiring.

• Penalties can result in higher Part B premiums for the rest of your life.

Image: Flickr user Alexander Boden.

You face penalties if you don’t sign up for Medicare during certain eligible enrollment periods.

9. You Can Change Medicare Coverage Each Year.

• From Oct. 15 to Dec. 7, you can switch plans or change between original Medicare and Medicare Advantage.

• From Jan. 1 to Feb. 14, you can drop Medicare Advantage for original Medicare ONLY.

Each year, there are times you can switch Medicare coverage.

Image: Medicare.gov.

10. Medicare Doesn’t Cover Everything.

Medicare coverage is limited for:

Image: Medicare.gov.

Nursing homes and long-term care.Most dental care and dentures.

Eye exams for prescribing glasses.Hearing aids.

Other items such as cosmetic surgery, acupuncture, and routine foot care.Medicare also requires you to pay

copays, deductibles, and coinsurance.

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