Choosing the Right Medicare Insurance Plan

Because there is a financial penalty (higher premiums if/when you do enroll) for not enrolling when you first become eligible for Medicare, most people on Medicare should enroll in prescription drug coverage, either a stand-alone Medicare Part D plan or a Medicare Advantage plan with prescription drug coverage included. Whether Original Medicare alone, Original Medicare plus a Medicare Supplement Insurance Plan, or a Medicare Advantage plan is right for you will depend on your unique needs and circumstances. Think about what is most important to you when you are healthy and when you are sick. Here are some topics to consider:

Receiving care from the doctor and hospital of your choice
Under original Medicare, you can use whichever specialists and hospitals you choose, whenever you need, and without a referral from another doctor. Medicare private plan options, such as Medicare Advantage plans, could limit your ability to get care from the doctor or hospital of your choice, or there may be extra charges for out-of-network care. If provider choice is a priority, you should consider original Medicare with added protection from a Medicare Supplement insurance policy, sometimes known as Medigap, or from an employer-sponsored or union retiree health plan, if you are eligible.

Getting additional benefits to reduce your medical costs
If you are on a tight budget and are willing to limit your choice of doctors and hospitals, you may be able to reduce your health care expenses and receive additional benefits through a Medicare Advantage plan. It is important to review the scope and limits of additional benefits when choosing among available plans. It is also important to look at how much your maximum out-of-pocket costs could be if you get sick. For example, some Medicare Advantage plans charge a copay for each day of an inpatient hospital stay, while original Medicare charges only a deductible but no daily copays for the first 60 days of a hospital stay.

Maintaining health care coverage while away from home
Under original Medicare, you will be covered for care anywhere in the United States. While Medicare Advantage plans must cover emergency care for members outside the plan area, most do not cover other health care services while away from home. For example, Medicare HMOs have more restrictive networks of doctors and hospitals that limit coverage away from home.

Keeping supplemental coverage from a former employer or union
You should talk to your employer or former employer to be sure you won't lose valuable retiree health benefits. Some employers offer retiree health coverage as a supplement to traditional Medicare; some also offer coverage through Medicare HMOs and other private plan options.