The Basics of Medicare

What Is Medicare?

Medicare is the largest health insurance provider in the U.S. It is broken into two parts: Part A and Part B. Each Part is responsible for different aspects of healthcare. Parts A and B combine to form Original Medicare. For more detailed information, consider downloading a Medicare guide off its official government Web site.

What Does Medicare Cover?

Medicare Part A is hospital insurance that covers hospital stays and attendant items associated with a hospital stay. It also provides coverage for physical rehabilitation and some home care. Medicare Part B covers doctors' visits and lab fees and requires you to pay monthly premiums, deductibles and co-payments for doctor visits. Medicare does not cover dental, vision, hearing tests, cosmetic surgery, shots, check-ups or long-term care.

What Happens when You Turn 65?

Anyone who has worked for a minimum of 10 years and paid into Social Security is eligible for Medicare at the age of 65. Three months before your 65th birthday, you will receive your Medicare card for Part A. However, you need to enroll in Medicare Part B, which has strict enrollment deadlines. If you do not enroll in Part B, you will see an increase in your premium each year.

The Gaps in Medicare Coverage

There are gaps in the coverage provided by Original Medicare, notably prescription coverage. Many people pay for a Medicare prescription plan from a Medicare-approved private insurer. (If you can't afford to pay for a prescription plan, Medicare will defray the costs for you.) A Medigap plan, which you would again get from a private Medicare-approved insurer, can cover costs for procedures and medical-associated expenses that Medicare doesn't cover, including long-term care if you should need some kind of assisted living. These outside plans do not always offer the same coverage nor have the same fees, so it makes sense to begin making health care plan decisions before you reach age 65.

Figure Out What Is Best for You

Medicare may seem like a labyrinth, but the more time you take to get acquainted with it, the better your choices will be for your health care. If you have a financial advisor, you may want to discuss your situation with her. A financial advisor will know your unique financial situation and can help you with decisions regarding additional insurance.