Product Learn Centers
Find The Best Insurance
We make it easy to compare and buy insurance.LEARN MORE
Medicare is the federal health insurance program for Americans 65 and over. It also covers younger Americans with certain disabilities or illnesses.
Medicare is the federal health insurance program primarily for Americans age 65 and over. It also covers younger residents with certain disabilities and diseases. Signed into law in 1965, Medicare currently covers over 58.5 million people. Often referred to as an entitlement program, Medicare is not free. Most beneficiaries pay premiums, deductibles and coinsurance or copays for "parts" of their health care. Here's a deeper look at Medicare.
|Medicare Part A||Medicare Part B||Medicare Part C||Medicare Part D||Medigap|
|Coverage||Hospital care||Outpatient care||Hospital, outpatient & more||Prescription drugs||Part A & B out-of-pocket costs|
|Mandatory?||Yes||Yes||No||No, if you have drug coverage||No|
|Premium||$0, $232 or $422||$134 or higher||Varies by plan||$33.50 on average||$140 to $380|
|Deductible||$1,340 per benefit period||$183 per year||Varies by plan||No more than $405 a year||$183 to $5,240 per year|
|Copay||$335 to $670 or more||20%||Varies by plan||Varies by plan||Contingent on your deductible|
Medicare Part C out-of-pocket expenses are capped at $6,700 a year. For a deeper dive how Medicare costs work, go here.
Medigap plan premiums vary by age, state, type of plan and more. Estimates are from a 2017 analysis by the American Association for Supplement Medicare Insurance.
HDHP stands for high-deductible health care plan.
Our partner Via Benefits can help you compare and buy Medicare plans in your area.
Medicare covers health care expenses for elderly Americans. It also covers Americans with certain disabilities. The program is administered by the Centers for Medicare and Medicaid Services (CMS) and funded by two trusts — the Hospital Insurance (HI) Trust Fund and Supplementary Medical Insurance (SMI) Trust Fund — held by the U.S. Treasury. These trusts are maintained via taxpayer dollars and premiums paid by Medicare beneficiaries.
Medicare was created in 1965 to help elderly Americans pay for health care. At that time, U.S. residents relied almost solely on employers for coverage. These days, the majority of Americans get health insurance through an employer, but there are alternatives, including Medicare. Americans can purchase health insurance each year on the federal and state exchanges created by former President Barack Obama’s health care law. Low-income residents are eligible for Medicaid, also created in 1965, all year round.
Learn more about how Medicare is funded.
Medicare has different parts. Medicare Part A covers inpatient (hospital) care; Medicare Part B covers outpatient (physician) care. Together, they make up Original Medicare.
Medicare Part C is an alternative to Original Medicare. It’s more commonly referred to as Medicare Advantage. Participants get all of the same Medicare benefits as Part A and Part B, but coverage is provided by private health insurers approved by the program. Medicare Part D is prescription drug coverage, and, if you’re already confused, don’t despair. We’ve got more details on each part below.
Americans 65 years old or over automatically qualify for Medicare. Permanent residents of the same age are eligible as well. Americans under 65 can qualify for Medicare if they are receiving Social Security Disability Insurance or SSDI for a period of time (usually 24 months). Younger Americans with terminal kidney failure or Lou Gehrig’s disease are also eligible for the federal program.
That depends. Most people get Medicare Part A premium-free, but are responsible for paying a $1,340 deductible each benefit period. (Benefit periods begin every time you’re admitted to a hospital and end when you’ve been out for 60 days). Copayments vary, depending on the amount of time you’ve spent in the hospital, but they end after 150 days.
Everyone pays a premium for Medicare Part B. The amount varies depending on income, but the standard rate is $134 a month. There’s a $183 deductible per year, and a 20% copay. The cost of Medicare Advantage and Medicare Part D varies by plan.
If you’re 65 and getting Social Security or Railroad Retirement Board benefits, you’ll get automatically enrolled in Original Medicare. Expect your cards in the mail three months prior to your 65th birthday.
If you’re 65 and not getting Social Security or Railroad Retirement Board benefits, you’ll need to enroll. Everyone gets a 7-month initial enrollment period. It kicks off three months before you turn 65 and ends three months after your 65th birthday. Coverage starts on July 1 of the year you enroll.
You can apply by visiting your local Social Security office or calling Medicare at 1-800-772-1213. But the online application is probably the easiest way to enroll.
You don’t need to re-apply for Medicare each year. You can review and change coverage each open enrollment period, which runs October 15 to December 7. Plans changeover on January 1.
Here is a step-by-step guide to applying for Medicare.
Medicare Part A is hospital insurance. It covers hospital, nursing home, skilled nursing facility, hospice and home health services. Most Part A recipients don’t pay a premium, but there is a deductible and copay for hospital stays. Medicare Part A and Medicare Part B make up Original Medicare.
Learn more about Medicare Part A.
Medicare Part B is medical insurance. It covers doctor’s visit for outpatient, mental health, ambulance and preventative care. Medicare B also provides select vaccination coverage. Recipients pay a monthly premium between $134 and $429, depending on income and tax filing status. They also have a $183 annual deductible and 20% coinsurance. Medicare Part B and Medicare Part A make up Original Medicare.
Learn more about Medicare Part B.
Medicare Advantage Plans are offered by private health insurers through the Medicare program. Some recipients opt for one of these plans to beef up coverage or lower out-of-pocket expenses. You have to enroll in Original Medicare to sign up for a Medicare Advantage plan, though — which means you’re still paying a Medicare Part B premium.
Learn more about Medicare Part C.
Medicare Part D is prescription drug coverage provided by program-approved private health insurers. Enrollment is voluntary. You can get coverage via a standalone Medicare Prescription Drug Plan or as part of a Medicare Advantage plan. Costs vary by insurer. Medicare rates all participating prescription drug plans on a scale of 1 to 5. The higher the number, the higher the plan’s quality.
Learn more about Medicare Part D.
Medigap is Medicare supplement insurance. It’s offered by private insurers and helps cover out-of-pocket health care expenses incurred through Original Medicare, like your premiums, copays and deductibles. Medigap plans do not cover any costs associated with Medicare Part C and Medicare Part D.
Learn more about Medicare supplement insurance (Medigap).
Medicare is federal health insurance for retirement age Americans. It is not the same as Medicaid, a jointly-funded state and federal health insurance program for needy, low-income Americans. Because Medicaid is partially funded by the states, eligibility requirements — and covered services — vary across their borders. You can find a state-by-state guide to Medicaid requirements here.
Learn more about the key differences between Medicare and Medicaid.
Low-income Medicare beneficiaries can get help paying out-of-pocket expenses associated with the federal health insurance Program. Its Medicare Savings Programs provide assistance with Medicare Part A premiums, Medicare Part B premiums, deductibles, copays and/or coinsurance. (These programs don't work in tandem with Medicare Part C.) Eligibility for a Medicare Savings program is largely dictated by income and assets. Specific requirements can vary by state and, in fact, you must apply through your state's Medicaid office to see if your qualify for one of the four available programs. Medicare beneficiaries who do meet the requirements are considered "dual-eligible" for Medicare and Medicaid with Medicaid considered the payer of last resort.
Learn more about Medicare Savings Programs.
Low-income Medicare beneficiaries can also apply for Extra Help, a program that helps pay Medicare Part D prescription drug costs. You can apply for this program through the Social Security Administration's website.
Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.
Security you can trust
Yes, we have to include some legalese down here. Read it larger on our legal page. Policygenius Inc. (“Policygenius”) is a licensed independent insurance broker. Policygenius does not underwrite any insurance policy described on this website. The information provided on this site has been developed by Policygenius for general informational and educational purposes. We do our best efforts to ensure that this information is up-to-date and accurate. Any insurance policy premium quotes or ranges displayed are non-binding. The final insurance policy premium for any policy is determined by the underwriting insurance company following application. Savings are estimated by comparing the highest and lowest price for a shopper in a given health class. For example: for a 30-year old non-smoker male in South Carolina with excellent health and a preferred plus health class, comparing quotes for a $500,000, 20-year term life policy, the price difference between the lowest and highest quotes is 60%. For that same shopper in New York, the price difference is 40%. Rates are subject to change and are valid as of 2/17/17.
Copyright Policygenius © 2014-2019