Adding a Social Security and Medicare Safety Net Into Your Retirement Plan
INCLUDING MEDICARE BENEFITS FOR HEALTHCARE COVERAGE In addition to Social Security, Medicare can be another critical financial planning tool. This federally funded program provides basic health insurance to those 65 and over and certain disabled individuals under age 65. When it was created, Medicare had two essential parts. Medicare Part A covered hospitalization, and Medicare Part B offered coverage for doctors’ services and medical equipment and supplies. Today, there is also Medicare Part D for prescription drug coverage and Medicare Part C – also known as Medicare Advantage, which offers an alternate method of receiving your Medicare coverage. Medicare provides Part A coverage (usually for no out-of-pocket expense), while Part B is optional and requires a monthly premium. Medicare Part A and Medicare Part B are also referred to as the “Original Medicare Plan.” With the original Medicare plans, individuals can choose their doctors, hospitals, and other healthcare providers, rather than using only someone in a particular network.
Medicare Part C (also commonly known as Medicare Advantage) combines Medicare Part A and Part B coverage. So, Medicare Part C enrollees receive the same benefits as those who are in Original Medicare as well as some added benefits. Only insurance companies approved by Medicare offer and underwrite Medicare Advantage plans. Generally, an insured person must see doctors listed in the plan’s “network”; however, their out-of-pocket costs could also be lower than in Medicare Parts A and B. They can also receive “extra” benefits, such as dental, vision, or wellness coverage, not offered through Original Medicare. Medicare Part D provides prescription drug coverage. This plan is optional and consists of private drug companies that Medicare approves. Part D covers different drugs, but medically necessary drugs must be covered. Part D may be purchased along with Parts A, and B. Medicare Advantage plans will often already have prescription drug benefits built into the plan.
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