For a lot of Texans, health insurance comes as a fringe benefit of their full-time job. But things get complicated if you become disabled or if you are retired and 65 or older because you will have a number of choices to make. For example, you need to know the basics about Medicare. Then, you need to know where Texans can go to get help.
What is Medicare?
In 1965, after recognizing the disconnect senior citizens face between needing health insurance and being able to get it, the federal government amended the Social Security Act to create a national health insurance program. That program is known as Medicare.
As it currently exists, Medicare provides health insurance to help cover hospital-type services, such as in-patient hospital care, critical access hospitals, skilled nursing facility care, hospice care, and some home health care. Those types of services are covered under what is called Medicare Part A.
Medicare insurance also helps cover the cost of doctor’s services as well. These types of services are covered under what is called Medicare Part B. For example, a doctor’s appointment, outpatient care, and many preventative services are covered under Medicare Part B.
Since 2006, Medicare also helps cover the cost of prescription drugs as well. That coverage is known as Medicare Part D.
What is Medicare Advantage?
Like “original” Medicare, the Medicare Advantage program is regulated by the federal government. However, unlike original Medicare, the insurance offered under the Medicare Advantage program is offered by private insurance companies. Basically, this is an alternative way to get Part A, Part B, and Part D coverage.
If you get coverage under a Medicare Advantage program, it will provide coverage for hospitalization (Part A), for doctor’s services (Part B), for prescription drugs (Part D), and many plans may offer coverage for things like vision, hearing, and dental. The Medicare Advantage program is also referred to as Medicare Part C.
Is Medicare free?
The short answer is: It depends. There are a number of things to think about.
Part A - If you worked for at least 10 years (40 quarters) and had Medicare taxes withheld from your paychecks, then you will be eligible for Medicare Part A and won’t have to pay for coverage. However, if you don’t qualify for premium-free Part A, you can buy coverage, but you will have to pay monthly premiums.
Part B – If you have Part B coverage, then you will have to pay monthly premiums. Typically, the premiums will be withheld from your Social Security benefits.
In addition, you will have to pay a “deductible,” which is the amount you have to pay before insurance coverage starts. After you have paid the deductible amount, Part B will typically cover 80% of the amount the doctor or medical equipment supplier can be paid under the Medicare rules. You will be responsible for the 20% difference. Some people choose to purchase a separate insurance policy to help pay the costs (e.g., the 20% co-pay amounts) that Medicare does not cover. These private insurance plans are commonly known as Medigap plans. Note also that, if you decide not to get Part B coverage and don’t have other creditable coverage, then you will have to pay a late enrollment penalty if you decide to add Part B coverage later.
People with high incomes will have to pay a little more, but people with low incomes may be eligible for assistance with paying the various premiums, deductibles, and copays.
Who is eligible for Medicare?
Generally, Medicare people apply for Medicare a few months before turning 65 so that benefits will be in place when they turn 65.
However, Medicare is also available for younger people that have end-stage renal disease and for those that are disabled (after meeting certain eligibility requirements).
How much do Medicare Advantage plans cost?
Medicare Advantage plan costs vary, but some people are able to join plans that do not require monthly premiums. However, even with a zero premium and zero deductible plan, you will still have to pay your monthly Part B premium to Medicare.
Additionally, Medicare Advantage plans set yearly limits on your out-of-pocket costs for medical services. Once you reach the limit, you do not have to pay anything for covered services. Unfortunately, every plan has different limits, and the limits change from year to year.
Do I have to pay for Part D, prescription drug coverage?
The short answer is no because you are not required to have Medicare Part D, but if you have Medicare, then you can get Part D prescription drug coverage if you want it.
If you do get Part D coverage, the cost will vary based on the plan you buy. But you can expect to have a monthly premium and a deductible. Additionally, the plan may limit the pharmacies you can use. The costs that you will pay for the prescription medications you need will also vary because the various plans have different “formularies” (which are lists of covered drugs).
If you decide not to get Part D and don’t have other insurance coverage for prescription drugs, then, if you change your mind later and decide to get Part D coverage, you will have to pay a late enrollment penalty.
What is the difference between Medicare and Medicaid?
Medicare is a federal health insurance program. Medicaid is a federal and state healthcare assistance program.
Who a Medicare Savings program?
Each state offers assistance with paying Medicare premiums, deductibles, coinsurance, and copays through a Medicare Savings program. There are four different programs, and they offer different levels of assistance. But you have to qualify, which means there are income and resource limits. The broadest level of assistance is under the Qualified Medicare Beneficiary (QMB) program, which pays Part A premiums, Part B premiums, deductibles, and copays. The next level of assistance is under the Specified Low-Income Beneficiary (SLMB) program, and there is also the Qualifying Individual (QI) program.
Where does a Texan go for help understanding all the various Medicare programs?
Texans have various resources available to help navigate these various Medicare programs and options.
First and foremost is Texas Health and Human Services Commission. Visit their Medicare page or call 800-252-9240, which is the Texas Medicare Help Line.
There is also a network of local support centers for seniors known as Texas Area Agencies on Aging. They can help you get specific information and help get you enrolled. Contact them at Area Agencies on Aging Directory | HHS (texas.gov).
And if you have legal questions about Medicare, you can contact the Legal Hotline for Texans at 800-622-2520.
What if I can’t afford the various Medicare costs?
You may be able to get help paying for premiums, deductibles, coinsurance, and copays through a Medicare Savings program.
Official Federal Medicare and You Publication
See the federal government's official Medicare and You guide.
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