How Old You Have To Be To Get Medicare

Medicare at a Glance

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While all of us wish for good health throughout our lives, unfortunately for many it is not always the case. Having adequate health insurance in place to cover the costs of medical care in the United States is becoming essential. While many obtain health insurance through employer sponsored programs or purchase a policy privately themselves, there are also government funded options available and Medicare is one of them. We look at the key facts you need to know about Medicare including what it is, who is covers and how much it is going to cost you.

What Is Medicare?

Medicare has been in existence since 1966 and is a single payer national social insurance program provided by the US Federal Government. It uses in the region of 40 insurance companies to provide health insurance. It is funded by a payroll tax, premiums and surtaxes from beneficiaries and other general revenue.

Who Is Covered By Medicare?

Medicare is provided to Americans ages 65 and older who have paid into the system via the payroll tax. There are a small number of younger people covered under Medicare, those with disability status and those with end stage renal disease and amyotrophic lateral sclerosis.

The Parts of Medicare

There are four parts to Medicare. Part A deals with hospital and hospital services. Part B deals with outpatient services. Part C was originally known as Medicare+Choice but was rebranded to Medicare Advantage and is an alternative to parts A and B and allows the insured person to experiment with different options and coverage. Part D covers self-administered prescription drugs.

The Cost of Medicare

There are varying costs for each part of Medicare. Individual circumstances also determine various rates. For individualized exact costs you will need to look at your own personal case however in general the following applies:

The Cost of Medicare Part A

Most people don't pay any premium for Part A. The standard premium if you paid Medicare taxes for less than 30 quarters is $422 or $232 if you paid Medicare taxes between 30-39 quarters. In addition, there is a $1,340 deductible for each benefit period and varying coinsurance depending on the number of days in each benefit period.

The Cost of Medicare Part B

The standard Part B premium is $134 however higher earners may pay more and those on Social Security may pay less.

The Cost of Medicare Part C

Monthly premiums for Part C are determined by the individualized plan and therefore there is no standard cost of premium. There will be other additional factors on cost including yearly deductibles and coinsurance.

The Cost of Medicare Part D

The insured person must sign up to a Prescription Drug Plan (PDP) or Medicare Advantage Plan that includes prescription drug coverage. The insured person chooses which drugs are covered in the plan (at least two in 148 categories) and therefore there is no standardized premium or cost as it depends on what is chosen.

Out-of-pocket Expenses

Medicare does not cover all the expenses of those included in the program. There are premiums as outlined above and deductibles and coinsurance which must be covered by the insured person. The level of deductible and coinsurance will be specific to individual plans and therefore total out of pocket expenses will vary greatly. Many of those covered under Medicare will also have additional health insurance coverage.

In Summary

Medicare is a government funded health insurance program mostly for those over the age of 65 and has four parts covering hospitals and hospital services, outpatient services and prescription drugs. Cost wise, while there are standardized premiums for Medicare Part A and B, costs vary for Parts C and D since the plan is individualized to the insured person. Despite substantial portions of medical costs being covered under Medicare, the insured person will often have out-of-pocket expenses and very often will require additional insurance to cover these costs.