Medicare Parts A, B, C, D and Medigap Explained

If you’re confused about the different “Parts” of Medicare and all the letters, you’re not alone. We, at Bluewave Insurance Services, have made the task of choosing the right Medicare part easier by breaking down and explaining each part of Medicare to make it easier to understand.

Medicare Part A: Hospital Insurance

Medicare Part A, also known as Hospital Insurance, covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care.

If you or your spouse have worked and paid Medicare taxes for at least 10 years (40 quarters), you typically won’t pay a premium for Part A.

Part A Costs

Even though most people don’t pay a premium for Part A, there are still some out-of-pocket costs to be aware of:

Deductible:  In 2024, the deductible for each benefit period is $1,632. This means you pay the first $1,632 of your hospital bill out of pocket.

A benefit period in Medicare Part A includes 60 days of hospitalization and an additional 30 coinsurance days. It starts the day a beneficiary is admitted to a hospital or skilled nursing facility (SNF) as an inpatient and renews when they haven’t received inpatient care for 60 consecutive days. If readmitted after more than 60 days, a new benefit period begins, and another deductible must be paid.

Coinsurance:  After the deductible, you’ll have coinsurance costs. For the first 60 days of inpatient care, you pay $0. From day 61 to 90, you’ll pay $408 per day. For days 91 to 150, you’ll pay $816 per “lifetime reserve day” (you have 60 of these days over your lifetime). After these are used up, you pay all costs.

When to Enroll in Part A

You can enroll in Part A during your Initial Enrollment Period (IEP), which starts three months before you turn 65, includes the month you turn 65, and ends three months after.

If you delayed Medicare Part A due to employment, you can sign up for Part A when you sign up for Part B, which will be covered next.

Medicare Part B: Medical Insurance

Medicare Part B, covers outpatient care, doctor visits, preventive services, and some home health care. It has a standard monthly premium, which is $174.70 in 2024. However, this amount can be higher depending on your income, known as the Income-Related Monthly Adjustment Amount (IRMAA).

IRMAA Charges

If your modified adjusted gross income as reported on your IRS tax return from two years ago is above a certain amount, you’ll pay an IRMAA in addition to the standard Part B premium.

When to Enroll in Part B

• Turning 65: Your Initial Enrollment Period (IEP) is the same as for Part A: three months before, the month of, and three months after your 65th birthday.
• Delaying Part B: If you or your spouse is still working and you are covered by an employer plan, you can delay Part B without penalty. Once you or your spouse retires, you’ll have an 8-month Special Enrollment Period (SEP) to sign up for Part B without facing a late enrollment penalty.

This penalty is a 10% increase in your monthly premium for each full 12-month period you could have had Part B but didn’t. So be sure to sign up on time!

Common questions around Part A and B

Many people have questions about Parts A and B coverage, enrollment periods, and potential penalties. Here are some answers to these common questions about the essential aspects of Medicare.

How Do I Know If I Have Part A or Part B?

You can check your Medicare card; it will show if you have Part A (Hospital Insurance) and/or Part B (Medical Insurance), or you can log into your ssa.gov account, or you can call 1800-MEDICARE.

What to Do If You Missed Your Initial Enrollment Period?

If you missed your IEP for Part B and you didn’t have credible employer coverage, you can sign up during the General Enrollment Period (GEP) from January 1 to March 31 each year, with coverage starting the first of the following month that you signed up. But be aware that you may face late enrollment penalties with Part B.

If you are entitled to premium-free Part A you can sign up whenever you want and there won’t be any late fees. If you don’t have enough working credits and need to pay a premium for Part A, there could be late fees if you miss your enrollment window.

Medicare Part C: Medicare Advantage

Medicare Part C, or Medicare Advantage, is an alternative to Original Medicare (Parts A and B). These plans are offered by private insurance companies approved by Medicare and combine Part A and Part B coverage together, becoming primary to Original Medicare.

Many plans also include Part D (prescription drug coverage) and extra benefits like dental, vision, and fitness programs.

These plans have networks of doctors and come in the form of an HMO or PPO. They are typically viewed as “pay-as-you-go” plans as there are copayments and out-of-pocket costs with most services on the plan. The premiums for these plans are generally $0 per month.

When to Enroll in Part C

You can enroll in a Medicare Advantage plan during your Initial Enrollment Period, the same as for Parts A and B. If you miss this, you can also sign up during the Annual Election Period (AEP) from October 15 to December 7 each year, with coverage starting January 1.

There’s also a Medicare Advantage Open Enrollment Period from January 1 to March 31 where you can switch plans or return to Original Medicare.

If you delayed Medicare due to employment, you will have a special election period to sign up for a Medicare Advantage plan that only lasts for 63 days starting the date your employer coverage ends.

Medicare Part D: Prescription Drug Coverage

Medicare Part D covers prescription drugs and is offered through private insurance companies. You can get Part D as a standalone plan if you have Original Medicare A or B.

When to Enroll in Part D

• Turning 65: Your Initial Enrollment Period for Part D is the same as for Parts A and B.
• Coming Off Employer Coverage: If you’re over 65 and leaving employer coverage, you have a Special Enrollment Period. You need to enroll in Part D within 63 days of losing your employer coverage to avoid a late enrollment penalty.

Premiums range between $0-$100 per month for Part D plans, depending on the plan you choose.

Medicare Supplement Plans (Medigap)

Most people who go with Original Medicare also purchase a Medicare Supplement (Medigap) plan. The most popular Medigap plans are Plan G and Plan N, and these plans help cover some of the out-of-pocket costs not covered by Original Medicare, such as copayments, coinsurance, and deductibles.

With these plans, you can see ANY doctor anywhere in the country that accepts Original Medicare without the need for a referral. The premiums range between $80-$150 per month on average.

When to Enroll

Your best time to buy a Medigap policy is during your Medigap Open Enrollment Period. This is a six-month period that starts the month you’re 65 and enrolled in Part B. During this period, you can buy any Medigap policy sold in your state without medical underwriting.

There are additional times you can purchase a Medicare Supplement plan without underwriting, these are called Special Enrollment Periods and include but are not limited to losing group coverage and moving out of a Medicare Advantage plan’s service area.

Bluewave Insurance Is Here to Help

So, there you have it—a comprehensive overview of Medicare Parts A, B, C, and D. Understanding these different parts is crucial to making the best choices for your health coverage as you turn 65 or if you’re transitioning from employer coverage.

If you have any more questions about Medicare plans then call us at 800-208-4974 today!