Welcome to Medicare 101!

If you’re nearing Medicare eligibility, this guide (based on our Medicare 101 video) will help you understand your options. We’ll walk you through the basics of Original Medicare, Medicare Supplement Insurance (Medigap), Prescription Drug Plans (Part D), Medicare Advantage, Medicaid programs, and Special Needs Plans.

What Is Medicare?

Medicare is a federal health insurance program for:

  • People 65 years and older
  • People under 65 with certain disabilities (after 24 months of Social Security benefits)
  • People with End-Stage Renal Disease (ESRD)

Medicare is administered by the Centers for Medicare & Medicaid Services (CMS), while enrollment is handled by the Social Security Administration (SSA) or Railroad Retirement Board (RRB).

Applying for Medicare

You can apply for Medicare starting three months before your 65th birthday. If you’re already receiving Social Security or Railroad Retirement benefits, you’ll be enrolled automatically. You don’t have to be retired to sign up. Applications are accepted at SSA offices, by calling 1-800-772-1213, or online at www.SSA.gov.

Medicare Basics

Medicare has different parts:

  • Part A: Hospital Insurance
  • Part B: Medical Insurance
  • Part D: Prescription Drug Coverage

Together, Parts A and B form what’s often called “Original Medicare.”

What Does Medicare Cover?

Part A covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health services.

Part B covers doctor visits, outpatient care, preventive services, diagnostic tests, and durable medical equipment.

Part D covers outpatient prescription drugs through private insurance plans.

Medicare Part A Details

Most people qualify for premium-free Part A based on work history (at least 10 years of Medicare-covered employment). Even if you have group coverage, you should not delay enrolling in Part A. Those without sufficient work credits can still buy Part A by paying a monthly premium.

Medicare Part B Details

In 2025, the standard monthly premium for Part B is $185.

Enrollment is automatic for some, but if you aren’t getting Social Security, you’ll need to sign up. You generally have a 7-month Initial Enrollment Period (IEP) starting 3 months before you turn 65.

If you miss it, you can enroll during the General Enrollment Period (January 1–March 31) but may owe a penalty — 10% for every full 12-month period you were eligible but didn’t enroll.

Some people can delay Part B if they have employer group coverage, avoiding penalties later through a Special Enrollment Period (SEP).

Paying for Part B

You can pay your Part B premium by:

  • Deduction from your Social Security check
  • Medicare Easy Pay automatic bank draft
  • Check or money order

Medicare Card

Once you enroll, you’ll receive a red, white, and blue Medicare card in the mail.

Turning 65 and Still Working?

If you’re still employed:

  • You may keep employer coverage and just enroll in Part A.
  • You may choose to enroll in Part B if your employer has fewer than 20 employees.
  • If you retire or lose group coverage, you’ll have a SEP to enroll in Parts A, B, and D without penalty.

If you have Medicare Parts A and B, you can then choose to:

  • Buy a Medicare Supplement (Medigap) plan and Part D coverage, or
  • Join a Medicare Advantage (Part C) plan (often includes Part D).

Medicare Choices

  • Original Medicare (Parts A & B)
  • Medicare Supplement Insurance (Medigap)
  • Medicare Advantage Plans (Part C)
  • Medicare Prescription Drug Plans (Part D)

Original Medicare Costs

In 2025:

  • Part A deductible: $1,676 per hospital stay
  • Part B deductible: $257 per year
  • 20% coinsurance after Part B deductible for most services

Medicare Supplement (Medigap)

Medigap policies are sold by private insurers and cover gaps in Original Medicare (like deductibles and coinsurance). You must enroll during your Medigap Open Enrollment Period (first 6 months after Part B starts) to avoid underwriting.

Medicare Advantage Plans (Part C)

Medicare Advantage plans are private health plans that bundle Part A, Part B, and often Part D coverage. Types include:

  • HMO: Use in-network providers, referrals needed
  • PPO: More flexibility, but higher costs out-of-network
  • PFFS: Choose any provider who accepts the plan’s payment terms
  • Special Needs Plans (SNPs): Tailored to people with chronic conditions, Medicaid, or those in long-term care

You must have Parts A and B and live in the plan’s service area to join a Medicare Advantage plan.

Comparing Medigap and Medicare Advantage Plans

Medicare Supplement (Medigap) Medicare Advantage (Part C)
Provider Choice Any provider accepting Medicare Plan’s network (HMO/PPO)
Monthly Premiums Higher Often lower or $0
Out-of-Pocket Costs Minimal after premium Pay as you go (copays/coinsurance)
Prescription Drugs Buy separate Part D plan Often included
Flexibility to Switch Limited (after initial enrollment) Can switch yearly during AEP
Extras (vision, dental, hearing) Not included Often included

Medicare Part D – Prescription Drug Coverage

Part D covers prescription drugs.

Options include standalone drug plans or Medicare Advantage plans with drug coverage.

You must enroll during:

  • Your Initial Enrollment Period (IEP)
  • The Annual Election Period (AEP) from October 15 to December 7 each year
  • Or through a Special Enrollment Period if you qualify

In 2025:

  • Maximum deductible: $590
  • National average premium: about $45/month
  • Out-of-pocket drug spending is capped at $2,000

If you delay enrolling without creditable coverage, you may pay a late enrollment penalty.

Important Enrollment Dates

  • Oct 15–Dec 7: AEP — change or enroll in MA or Part D plans
  • Jan 1–Mar 31: Medicare Advantage Open Enrollment Period
  • Special Enrollment Periods: Triggered by life events (moving, Medicaid eligibility, etc.)

Special Needs Plans (SNPs)

SNPs are available to people with certain chronic illnesses, dual Medicare and Medicaid eligibility, or those living in long-term care facilities. They offer specialized care coordination and benefits.

Extra Help with Drug Costs

The Extra Help program assists people with limited income and resources, helping pay Part D premiums, deductibles, and copays.

You may automatically qualify if you:

  • Receive full Medicaid
  • Get Supplemental Security Income (SSI)
  • Get help from Medicaid paying Medicare premiums

Otherwise, you can apply through Social Security.

Medicaid

Medicaid is a joint federal and state program providing health coverage for those with limited income. Eligibility rules vary by state. For help, contact your local Medicaid office or Department of Social Services.

Additional Medicare Guidance

Helpful resources include:

Questions?
Feel free to email us at info@jmeinsurance.com or call (972) 245-0266 for assistance!