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Navigating the Medicare maze


Getting close to age 65? You're going to have to take a crash course in a topic that's very important to your health: the ins and outs of Medicare.

Medicare is the federal government health insurance program that covers people 65 and older -- along with some younger people with disabilities.

Medicare is complicated, and it's best to start learning about it early -- ideally, several months before your 65th birthday, says Patricia Barry, who writes the AARP's Ask Ms. Medicare column and is the author of "Medicare for Dummies."

It's crucial to get a head start because there's a steep learning curve, with many options to consider, decisions to make and pitfalls to avoid, Barry says.

"Everyone is baffled by Medicare," she says.

The basic parts of Medicare

One thing that makes Medicare confusing for many consumers is that it's made up of multiple parts that work together.

"Medicare will tell you it has four parts, but I teach it as three parts," says Diane Omdahl, a registered nurse and co-founder of 65 Incorporated, a company that helps consumers navigate Medicare.

Here are the three basic parts of Medicare: 

  • Hospital coverage -- Medicare Part A covers hospital stays, skilled nursing facility care, home health services and hospice. Part A does not cover nursing home care if you only need custodial care, which means personal care -- such as bathing and help to the bathroom. If you or your spouse have worked and paid enough payroll taxes to build up 40 credits -- about 10 years' worth of work -- you can get Part A free. Others have to pay premiums of up to $407 per month. You can use the premium calculator from to see how much you'll pay.
  • Medical coverage -- Medicare Part B covers doctor visits, mental health services, preventive care, outpatient treatments, surgery, and medical supplies such as crutches, hospital beds, oxygen equipment, patient lifts and walkers. Most Medicare recipients pay Part B premiums of about $105 a month.
  • Prescription drug coverage -- Medicare Part D covers prescription drugs. Each Part D plan has a list of covered drugs, and premiums and copays can vary widely, Omdahl says. There are at least 25 plan options in every state.

Medicare parts B and D are optional -- so you don’t have to sign up for all three parts. For example, some Medicare recipients skip Part B if they’re still getting health insurance through an employer or spouse's employer.

There's also a Part C, a fact that perplexes many consumers, Omdahl says. But, Part C is simply a provision that allows private companies to offer coverage, such as HMO or PPO plans, that offer the same benefits as Medicare. These plans, known as Medicare Advantage plans, include hospital, medical and usually prescription drug coverage. In general, you can join a Medicare Advantage plan if you: live in the area served by the plan, have Medicare Part A and Part B, and don't have end-stage kidney disease, according to

So, a consumer has two choices, Omdahl says:

  1. Traditional Medicare administered by the federal government, which can be paired with supplemental coverage to cover some items Medicare doesn't, such as deductibles and copays. Supplemental coverage is also known as Medigap.
  2. A Medicare Advantage plan from a private insurance company. You join the plan directly through the private insurer after you join Medicare Part A and Part B. You can shop for plans using the plan finder. Once you've signed up, the federal government pays the plan a set amount to cover your care.

Which choice is best for you? That will depend on an array of factors, including how often you change residences, your preference in doctors, your feelings about private insurance companies and your health, Omdahl says. offers a chart that compares the two options.

"You need to look beyond right now," she says. "Look at what your health and life might be like 20 years from now."

Navigating the Medicare maze

Navigating Medicare enrollment

When it's time to enroll in Medicare, you join Part A first by applying online at, at a Social Security office, or by calling (800) 772-1213. You then fill out an application for Part B and drop it off at a Social Security office. 

It's easy to make mistakes when you're new to Medicare, and those missteps can cost you big down the road, Barry says.

Here are four Medicare pitfalls to avoid:

  1. Mistakenly thinking you don't qualify. Some consumers wrongly assume they can't get Medicare because neither they nor their spouse has worked, and paid payroll taxes, for long enough -- usually about 10 years. In that case, you may still qualify for Medicare, but will have to pay monthly premiums for Part A, Barry says.
  2. Assuming you'll be automatically enrolled. Some people get automatically enrolled in Medicare parts A and B, while others have to sign up. You can check by calling or visiting your local Social Security office.
  3. Not signing up in time. At least three months before you turn 65, get clear on what you need to sign up for, and when. If you don't, you risk getting hit with coverage delays and costly penalties.
  4. Skipping prescription drug coverage. Some consumers don't purchase a Medicare Part D plan because they don't take any prescription drugs, Barry says. "That's a mistake," she says. "You don't have a crystal ball to know what is going to happen with your health."

Still need help navigating the Medicare maze? Contact your State Health Insurance Assistance Program (SHIP), Barry recommends. SHIPs provide one-on-one, in-depth Medicare help to consumers in all 50 states; Washington, D.C.; Guam; Puerto Rico and the U.S. Virgin Islands. For phone numbers, go to the SHIP website and select your state.

"They're very good, and they're free," Barry says.

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