Understanding Medicare, Coverage, and How it Works

Understanding Medicare

For those who are 65 or older and are considering making the switch to Medicare, there are important facets of the plan to understand before doing so. This federal health insurance covers services for individuals aged 65 or older, as well as those who are under 65 that have disabilities or serious medical conditions. For those who are eligible and currently receive retirement through Social Security or the Board of Railroad Retirement, you are more than likely eligible to receive Medicare coverage as well.

Different Parts of Medicare


  • Inpatient hospital care
  • Skilled nursing care
  • Some health services

You usually don’t have to pay a premium, but is also highly unlikely that the full cost of your services will be covered.


  • Diagnostic testing
  • Doctor’s visits
  • Outpatient care

This part includes a monthly premium and deductible. Check with your doctor for complete coinsurance information and testing or services covered.


  • Dental
  • Vision
  • Hearing

Part C can be understood as a Medicare Advantage Plan that combines parts A and B into one. This is typically offered through private insurance companies and to receive it, you have to also enroll in parts A and B. Think of it as an umbrella.


  • Prescription drug costs

Also available through private insurance providers, out-of-pocket costs will vary depending upon your plan selection.

Medigap is a supplemental insurance that covers out-of-pocket costs not accounted for or included in parts A and B like coinsurance, copayments, or deductibles. It won’t cover everything and is highly recommended to combine this with parts A and B and D so your coverage is high quality.

Parts A and B: Automatic Enrollment

You can opt to become automatically enrolled in Medicare Parts A and B when you turn 65 or sign up yourself. To know whether or not you’ll be automatically enrolled, you can look for a Medicare card to be mailed to you before your 65th birthday. When you enroll yourself, you must do so within the Initial Enrollment Period which is open for 7 months around your 65th birthday. With these parts you can visit any doctor enrolled within the program and you will not need:

  • A primary care physician
  • A referral to visit a specialist

Beware, Part B does include a deductible so you will be responsible for a specific amount out of pocket charge before Medicare pays the rest. This doesn’t include the copayment and Medicare will not set the limit for your out-of-pocket expenses. Be sure to consider whether premiums and deductibles are worth the benefits as additional insurance is never required.