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As you or a family member approaches the age of 65, it’s time to start thinking about applying for retirement and Medicare benefits. Please refer to the information below to learn the difference between Medicare A and B so that you can make the best choices for you and your loved ones.
What is the Difference between Medicare A and B?
Medicare is composed of three parts: Part A, Part B, and Part D. Here is a summary of each type of insurance and what it covers:
Medicare Part A – Hospital Insurance
- Coverage for inpatient hospital care, hospice care, inpatient skilled nursing facility, and home health care
- Automatically enrolled at age 65
- For most recipients, there is no premium charged because the recipient paid into the system through Medicare taxes while working
Compare Part A with Part B below to see the difference between Medicare A and B:
Medicare Part B – Physicians and Medical Tests
- Coverage for physician services, outpatient care, home health, and medical services
- Provides coverage for some preventive health services
- Requires enrollment
- Premium is based on recipient’s income; you pay monthly premiums for this coverage; if you are already receiving Social Security benefits, it is usually deducted from your monthly Social Security benefit
- Covers 80 percent of costs, recipients responsible for a 20 percent coinsurance
After learning the difference between Medicare A and B, you can opt for additional coverage with Medicare Part D.
Medicare Part D – Prescription Drug Coverage
- Prescription drug coverage through a private insurer approved by Medicare
- Enrollment requires Part A and Part B enrollment
- Premium is based on recipient’s income, similar to Part B
- Can review and change plans annually
When Should Someone Enroll in Medicare?
For most individuals, they enroll in Medicare when they turn 65. Every enrollee is eligible for an Initial Enrollment Period (IEP) that runs for seven months – the three months prior to their birth month, their birth month and the three months after their birth month. We recommend beginning the signup process 3 months before your 65th birthday once you have read about and understood the difference between Medicare A and B and decided which option is right for you.
How Do I Enroll?
Enrollment automatically occurs if you are enrolled for Social Security benefits. You will have to enroll on your own for Medicare if you have not signed up for Social Security. If you decide to delay your Social Security retirement benefits beyond age 65, there is an option to enroll in just Medicare and apply for retirement benefits at a later time.
You can learn about the difference between Medicare A and B and enroll in one or both by contacting Social Security in the following ways:
- Online at www.SocialSecurity.gov
- By calling Social Security at 1-800-772-1213
- In-person at your local Social Security office
Does Enrolling In Medicare Affect My Ability to Contribute Toward An HSA?
Yes, if you are enrolled in any part of Medicare, then you are prohibited from making a contribution to an HSA plan from the date of your enrollment onward.
Who Is A Recommended Resource for Medicare Policies?
You can learn more about the difference between Medicare A and B by contacting:
Billy Baschnagel, RHU
West Avenue Insurance
1502 West Ave, Austin, TX 78701
Talk to the Professionals at ML&R Wealth Management
When you or a loved one is planning for the senior years, there are a lot of things to think about and prepare. Read more about Social Security, IRA contribution limits, and key estate planning documents on our website and contact our team of wealth management professionals to learn about the difference between Medicare A and B for a healthy and wealthy retirement.