Turning 65? Let’s Explore Your Medicare Options

Every birthday is an occasion worth celebrating, but some are real milestones. By the time your 65th rolls around, you’ll have some important decisions to make about your healthcare. 

If you’re like most U.S. citizens and permanent residents, your Medicare Initial Enrollment Period starts three months before the month of your 65th birthday and ends three months afterward (if you happen to have been born on the first of the month, this period begins four months before your birthday). 

So, should you sign up for Medicare right away? Do you need additional coverage? And should you consider one of those Medicare Advantage plans you’ve seen advertised? 

Let’s look at the options that are available to most people when they become eligible for Medicare so you can start considering what’s right for you. 

Original Medicare 

Original Medicare is the health insurance program administered by the federal government for people who are either over 65 or have certain disabilities. This coverage can be used across the country at any doctor’s office or healthcare facility that accepts Medicare. 

Original Medicare consists of Medicare Parts A and B: 

Medicare Part A 

• Covers inpatient care like stays at hospitals, skilled nursing facilities, or in hospice.  
• There’s no monthly premium for Medicare Part A if you or your spouse paid Medicare taxes while working for at least 10 years.  
• You do have to pay a deductible for each inpatient stay ($1,632 in 2024) before your benefits kick in, as well as copayments in some situations.

Medicare Part B 

• Covers medical needs like visits to the doctor’s office, preventive care, outpatient mental health, and durable medical equipment. 
• Part B has a monthly premium, which is adjusted each year. As of 2024, most people pay $174.70 a month, though that cost can go up based on income; you’ll pay more if you file taxes as an individual and make over $103,000 a year or if you file jointly with your spouse and have a combined income of over $206,000. 
• There is also a deductible ($240 in 2024) you must reach before Medicare starts to pay, and you’ll be charged coinsurance (usually 20% of the Medicare-approved cost) for most services. 

If you don’t currently have health insurance from another source, such as your or your spouse’s employer, you should sign up for Medicare Part A and B right away during your Initial Enrollment Period. Going without insurance to save money in the short term can result in serious consequences for your health and finances. If you wait and choose to sign up later, for example, you may be subject to a late enrollment penalty, permanently adding 10% to your Part B premiums for every year that you were eligible but not enrolled. 

You can also find help with your insurance expenses, such as savings programs available through your state and some of the other coverage options we’ll discuss in this article. 

If you or your spouse are still covered by an employer-provided health insurance policy, you may want to hold off on Part B, but you should consider joining Medicare Part A right away. Most people pay no monthly premium for Part A, and if you still have insurance from another source, Medicare will help with costs from inpatient care that aren’t paid by your primary health insurance. After you’re no longer covered by employer-provided insurance, you’ll have an eight-month Special Enrollment Period, when you can sign up for Part B without paying the penalty. 

Medicare Part D 

To get coverage for most prescription medications, people on Original Medicare need a Medicare Part D prescription drug plan. These plans are administered by private insurance carriers, and which ones are available to you depends on where you live. When choosing a prescription drug plan, you should verify that any prescriptions you take will be covered and compare the premiums and expected out-of-pocket costs with other plans in your area. 

The copays associated with covered drugs, monthly premiums, and deductibles for Medicare Part D differ by plan. In 2024, the maximum possible deductible is $545 per year. 

Medicare Part D can be especially valuable for people who are living with diabetes. Under current regulations, you’ll pay no more than $35 for a one-month supply of covered insulin. 

There can be financial risk in not enrolling in a Part D prescription drug plan when initially eligible. If you don’t have prescription drug coverage that Medicare considers comparable to a Part D plan (such as through employer-provided insurance or the TRICARE Pharmacy Program for veterans) for 63 days in a row, you will be charged a late enrollment penalty. The penalty increases each month that you go without prescription drug coverage. 

Medicare Supplement 

Also referred to as Medigap coverage, Medicare Supplement insurance helps with out-of-pocket costs that aren’t paid by Original Medicare like deductibles and coinsurance. In most states, you have a choice of 10 standardized plans, which you can purchase from private insurance carriers (the standardized plans available in Massachusetts, Minnesota, and Wisconsin are different).  

After you turn 65 and enroll in Medicare Part B, you’ll have a six-month Medicare Supplement Open Enrollment Period. At this time, you have guaranteed issue rights, which allow you to buy a plan at the lowest possible price without answering health questions.  

If you decide to put off Medigap enrollment or change plans later, you may have to go through medical underwriting that could lead to higher costs or a denial of coverage. Note that the rules about medical underwriting differ based on the state where you live, so you can check with your state insurance department to learn how much flexibility you have to start or switch plans. 

Keep in mind that a Medigap plan does not include Part D prescription coverage. You will need to purchase a Part D plan separately. 

Medicare Advantage

If you prefer, you can choose a Medicare Advantage plan from a private insurance carrier as a substitute for Original Medicare.  

Also referred to as Medicare Part C, these plans match the coverage you’d get from Original Medicare. and most also feature Part D prescription drug coverage. Other benefits vary by plan, but they may include coverage for dental, vision, and hearing care, gym memberships, and more. Medicare Advantage plans also establish an out-of-pocket maximum for your annual healthcare spending, which Original Medicare does not. 

As of 2023, a majority of people who were eligible for Medicare chose to enroll in Medicare Advantage plans. What specific plans are available to you depends on where you live as well as your health and financial situation, so you should go over your choices with a licensed insurance agent. 

You’ll become eligible to sign up for a Medicare Advantage plan after you’ve enrolled In Medicare Parts A and B. You can do so during your seven-month Initial Enrollment Period around your 65th birthday, or if you wait to sign up for Part B, during the first three months after your Part B coverage starts.  

If you decide to stick with Original Medicare for now, you’ll still have the opportunity to switch to Medicare Advantage during the Annual Enrollment Period, which runs from October 15 to December 7. During this time, you can also change from one Medicare Advantage plan to another. 

Turning 65 is an excellent time to evaluate your healthcare needs and decide how Medicare will fit into your plans. By carefully reviewing the coverage available to you, you can decide on the best path to manage your well-being and maintain financial security through the birthdays yet to come.  

About GoHealth

GoHealth is a leading health insurance marketplace and Medicare-focused digital health company. Enrolling in a health insurance plan can be confusing for customers, and the seemingly small differences between plans can lead to significant out-of-pocket costs or lack of access to critical medicines and even providers. GoHealth combines cutting-edge technology, data science, and deep industry expertise to build trusted relationships with consumers and match them with the healthcare policy and carrier that is right for them. Since its inception, GoHealth has enrolled millions of people in Medicare plans and individual and family plans. For more information, visit GoHealth.com.