Medicare costly mistake

Medicare has numerous components, rules, restrictions and confusion. Around 75% of American adults over age 50 wish they understood this complex government health policy better. It’s not how much you pay that’s costly–it’s lack of information that hurts eligible recipients.

A deeper understanding of costs, coverages and other components of Medicare can help erase doubts while better positioning recipients over 65 to receive optimal benefits. Here’s how you can avoid two of today’s most costly Medicare mistakes.

Know Costs Before Enrollment

Part B premiums are deducted from monthly benefit amounts, whereas Part A is free with an annual deductible. Many enrollees are misled, believing both Part A and B are free. In fact, 53% of retirement-age adults earning over $150,000 aren’t aware of Part B’s premium costs.

Currently, individual incomes less than $85,000 and couples with $170,000 pay preset Part B premiums of $134 monthly. Individuals and families earning higher than those income brackets will pay slightly more, according to the Social Security Administration (SSA). Knowing these and other costs help people turning 65 be prepared.

Medicare Doesn’t Cover All Long-term Costs

Nursing homes, for one, only cover basic rehabilitation and other limited services. Unfortunately, basic needs like bathing, eating, dressing and exercising aren’t always included. Under strict income guidelines, Medicare will cover long-term care, although expect plenty of red tape.

Part of that red tape includes SSA’s five-year look back period, which allows the government to closely scrutinize income and spending habits during that 60-month period. Part of their income review includes looking at gifts made outside of family and sales of items below market value. A recent survey suggests nearly half of all retirees would give their money to children just to enroll in Medicare.

Finally, Medicare enrollees searching for long-term care can’t always choose where they go or how much is charged. Most retirees of sound mind want control of their care, a component that Part B simply doesn’t allow.

Medicare does not cover a stay in any type of facility, nor do Medicare supplement policies.  In order to make sure you are covered in the event of a move to an assisted living facility or having to have someone come into your home to assist with your daily needs, a long-term care insurance plan is important.

Bottom Line

It’s important you peruse information available from the SSA, understand your basic needs, and consider the ramifications of enrolling in Medicare prior to applying. Simple calculations and questions can spare future stress.

Finally, know that Medicare will not always cover long-term care costs, nor will the government be quick to pay for costs outside of their scope. To learn more about Medicare, call our customer service helpline or talk with your reliable personal benefits manager (PBM) to discuss your options.

P.S. We want to make Medicare easy for you. Because of this, we created The Medicare Playbook, which is available on Amazon or Kindle, to help guide you on  signing up for original Medicare, as well as the insurance products that complement it.

Wiley Long is founder and president of Medigap Advisors, and is passionate about helping people navigate the confusing waters of Medicare. He is the author of The Medicare Playbook: Designing Your Successful Health Coverage Strategy, a clear and simple explanation so you can make the most of your Medicare coverage.