Do you need a Medicare plan? It’s standardized social insurance, isn’t it?

Oh, Mona, you have a lot to learn! (Unless you’re quite far away from retirement age, of course. Although, you might gain some good insight here if you’re purchasing insurance on the ACA exchanges as well!)

For many folks, healthcare insurance has been a limited-choice environment, where our employers have given us at most a couple of options to choose from, and very little in the way of variability in the plan options. But when it comes to Medicare, (and not surprisingly, ACA-exchange insurance), the playing field is vast and variable. It makes a lot of sense to do your research as you enroll for Medicare. And this applies whether you’re signing up for the first time or you’re a veteran of many Medicare battles over the years.

Outline of a Medicare Plan

On Medicare’s official website, which has been criticized for being confusing and difficult to navigate, there is a list of seven things you should consider when choosing coverage. Incidentally, Medicare also takes it on the chin for offering little guidance in choosing your best option, but the referenced article is actually a pretty good place to start.

I won’t copy the article verbatim here, but I’ll walk through the major points briefly to underscore the importance of a Medicare plan for yourself and your family.

The first item in the list is costs. And costs for healthcare are potentially enormous. If you make a mistake about your Medicare filing and don’t pay attention to the costs, it could be financially disastrous for you and your family.

One of the niggling details about Medicare is that, if you’ve chosen the traditional path of Medicare Part A coupled with Medicare Part B, you are setting yourself up for a potential calamity. This is because Part B has no out-of-pocket maximum – no cap on how much you can be required to pay in copayments and coinsurance during a year or over you lifetime. Imagine the seemingly unlimited cost for some of these new, cutting-edge targeted medical treatments. You could be required to pay a percentage of millions of dollars of treatment.

It is for this reason that many folks (but not a majority, by any stretch) choose a Medigap (or supplement) policy to augment Parts A & B. Medigap policies are designed to fill the “gaps” in coverage, keeping you from the pain of having to pay unlimited coinsurance.

Medicare Advantage plans (aka Part C) can also resolve this issue, as these plans each have annual out-of-pocket maximums.

Of course, Medicare Advantage plans and Medigap insurance all add to the premium costs, so again, you should research and plan what your costs might be with various coverage options.

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