Most retirees have two main senior health insurance options--Medicare and managed care. Medicaid is a program that pays for medical assistance only for those seniors with low incomes or disabilities.
As long as you have contributed enough through FICA taxes, you will be eligible for the best senior health care option--retired or not--for Medicare when you turn 65. Apply for Medicare coverage three months before your 65th birthday.
Senior health care provided by Medicare is divided into four components:
Part A–Hospital Insurance
Part B--Medical Insurance (Optional)
Part C–Additional Insurance Coverage
Part D--Offers voluntary prescription drug coverage offered via private vendors
Let's look at each of these components of Medicare senior health coverage.
Part A is called hospital insurance. It covers most costs of your stay in the hospital, as well as some follow-up costs after being in the hospital. It also pays some outpatient medical services, including medically necessary equipment and supplies, senior health care at home, and physical therapy. Under most circumstances, you do not have to pay a premium for Part A.
Part B is medical insurance. It's optional. If you elect it, the monthly premium is deducted from your Social Security check. It provides for certain out-of-hospital treatments and is intended to help pay doctor's bills for treatment in or out of the hospital. It also covers many other senior health care medical expenses you incur when you are not in the hospital, such as the costs of necessary medical equipment and tests.
Medicare Part B has spawned additional senior health insurance coverages:
Its Original Medicare Plan and Medigap insurance.
Medicare Part C coverage: Medicare Managed Care Plan (like an HMO) and Medicare Private Fee-for-Service Plan.
With the Original Medicare Plan, you pay your Part B monthly premium and then pay for additional services as you use them. With this plan, you might also choose to buy Medicare Supplement Insurance, or "Medigap" insurance. The term 'Medigap' implies that these insurance policies will cover the gaps in Medicare payments. Medigap does not fill all the gaps in senior health insurance but it helps.
Part C: Medicare Managed Care and Private Fee-for-Service plans are offered by private insurance companies. Managed care plans generally fall into two main varieties: health maintenance organizations (HMOs) and preferred provider organizations (PPOs). HMOs are generally less expensive than PPOs, but usually more restrictive in their services and choice of doctors.
With these latter two plans in Part C, you must continue to pay your Part B premiums, and you may also have to pay an additional premium to the insurance company, as well as any related deductible or co-insurance payments; however the services you receive may be more comprehensive than those offered through the Original Medicare Plan.
When considering senior health care option, compare the costs and local availability of Medigap with the Medicare Managed Care and private fee-for-service programs. Be prepared for heath problems in retirement. They are part of aging. Do not wait until they happen to cover the costs as it will be too late.
Related information: Medicaid Annuities
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Interesting article, especially for someone like me that's about to approach retirement. I love reading such articles to prepare myself and help me get the best from retirement. I see lots of other friends of mine about to enter retirement but they don't care and don't bother reading such helpful blogs. Anyway, thanks again for sharing this and the other helpful articles you have here.
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I always love to see this kind of article because it bring life to the retirees I appreciate it.
I am trying to look up an insurance policy for a 65year old with high blood pressure, but otherwise well. Does ANYONE know of a health care provider who won't deny my patient? She was denied MediCal and told to search someone who would charge $150 a month. Thanks.
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Be sure to stay up to date in 2010, as changes will be coming to the Medicare supplement plans offered, and Medicare Advantage will likely see changes as well.
Medicare and medicare supplement plans are very important for the well being of our seniors and should be understood by everyone who is about to reach retirement age.
That was a good read. As I am approaching retirement, I need to really think more on these options and try to get everything in order.
As I write this comment, the first draft of the new health care reform has passed and now will be modified by both houses to appease enough legislators to get it passed. What I have seen thus far is very disappointing, especially the proposed cut in Medicare payments for our seniors. Granted, the system is prime for abuse and billions of dollars in claims have been paid, but instead of cutting payments for legimate services, why not hire more investigative personnel to review claims? The savings generated there would probably save many dollars. I am a firm and very strong believer in taking care of our senior citizens. They have worked hard all of their lives and "paid their dues", and at the time when they need medical help, they deserve to get it. No government paid physician or other politician has the right to say who gets care and who doesn't! I'm deeply saddened that the richest country in the world will have one of the worst health care plans. I could write a book on what I have seen and been exposed to during my career, but it would be too depressing. I'm still proud to be an American and have served my country in the military, but the current proposed changes in the health care system truly disgust me.
very good article for all the retiree they will get all the benefits they will be needed it sure will help
Thanks for sharing this. As someone approaching retirement, I didn't realize how many options there were to consider. I am going to bookmark this to use as a reference and pass it along to my friends. Thanks!
This information is great! A very important topic when near retirement folks are trying to plan their financial future. Especially in this economic day its good to see all the options out there.
I would like to thank you for the efforts you have made in writing this post. Senior citizens who have comparatively low income or are not getting enough benefits can go with a Medicaid programs which covers them with medical assistance. Hospital insurance and medical insurance are the major components of Medicaid for elderly.
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Thanks again.