The Medicare is a program and all its parts: Medicare Part A (for Hospital), Medicare Part B (Medical) , Medicare part C (Medicare Advantage) and Medicare Part D (Medicare Prescription Drug Coverage) is complicated and byzantine and often counterintuitive. This means that it lends its itself to be being mysterious, misunderstood, and easy to make assumptions about. In our offices we see hundreds of Medicare clients every year and we unfortunately see people make the same mistakes repeatedly with regards to their Medicare. This is because people make assumptions about Medicare that are often based of things they hear from their friends, or websites or from tv or radio. But these assumptions can lead some people to make pretty big mistakes with their Medicare. These mistakes can be as minor as paying a bit more for medications or can be as big as causing higher premiums for an entire lifetime. Today we are going to talk about the five avoidable mistakes that people make with there Medicare. Do not forget to like and subscribe 

Thinking that Medicare is Free 

• This is a common mistake we get from our clients and it would make sense that Medicare should be free.
• If you look at your paycheck every month you can see that money is taken out every month to pay for “Medicare” 
• But the reality is that this money only serves to pay for only part of your Medicare costs.
• Medicare Part A is for hospitalization and is the portion that is covered by these deductions from your paycheck.
• Medicare Part B is for day to day medical services and is not covered by your paycheck deductions.
• In 2020 the monthly cost for part B is $144.60 or for Part D, for Medicare Prescription drug coverage, which on average is around 40$ a month
• These costs should be paid monthly to ensure that you have full coverage  

Thinking that Medicare will pay all of your healthcare costs

• Some people have paid into the Medicare system for 10 ,20, 40 years 
• Additionally, they are paying a monthly premium of $144.60 for Medicare Part B 
• Plus, additional money for $40 for your Medicare Part D prescription coverage 
• That should be enough paid in to cover all your healthcare costs, right? 
• Unfortunately, Medicare does not cover 100% of your Medical and Prescription costs.  
• In fact, it will have set copays and coinsurance and in general will cover 80% of your health care costs, excluding any Prescription Drug Coverage 
• Even with the 80% coverage it means you are responsible for 20% of your healthcare costs
• Unlike most under 65 year old health plans there is no limit to how much you can pay under Medicare; since  you are responsible for 20%,  you have to pay the 20% of your bill weather it is a 100$ bill or 100,000$ bill 
• But either way thinking that Medicare will cover all your costs can end up being an expensive mistake, if you have any major health issues and do not have any supplemental Medicare coverage

Not applying for Medicare part B  

• Medicare part A and Part B are what make up Original Medicare
• It is something that people will usually get enrolled into 
• Automatically once a person becomes eligible
• Part A usually doesn’t have a cost to it, because it was paid into it all the years someone worked
• Part B on the other hand has a monthly premium of $144.60 
• This leads some of our clients to think that they could avoid paying the $144.60
• By just not taking the part B or canceling Part B 
• But this is usually a very a bad idea!
• And it ends up being penny wise and pound foolish in many cases 
• There are a couple of reason this is a bad idea

• • First, because if you do not get Part B when you initially are eligible you will not be able to get it back until July of the next year
  • A lot of health problems can happen between now and next July
  • Second, there is a penalty for waiting to apply for Medicare Part B, if you do not have other “credible coverage” like through your work, or the VA or a spouse.
  • The penalty will grow every month until you eventually enroll into Medicare Part B coverage
  • Additionally, this penalty will be added on top of what is the current year Medicare Part B price. 
  • For example, if you waited a year to get Medicare Part B and the penalty grew $1 per month and you didn’t have it It would mean that for the next year if you enrolled in Medicare Part B then you would have to pay $144.60 plus the $12  a month  which would equal $156.60 a month
  • This additional $12 would be added monthly for the rest of your LIFE 
• This could mean potentially thousands of dollars over a lifetime

Assuming you do not qualify for help through any program that assist people paying for some or most of your Medicare costs

• Many people assume that they are not eligible for any help paying for their Medicare cost 
• But it is possible that they may be eligible for some form of help for:  

• • Paying for Medicare premiums
  • Paying for some Prescription Drug costs 
  • Or help paying for copays and coinsurances 
• The income guidelines for some of the assistance programs are very generous 
• Medi-Cal / Medicaid is one of the options, but is not the only options
• Low income subsidy (LIS) is meant to help paying for prescription drugs 
• Medicare Savings Programs (MSP) will help cover your other Medicare costs
• Additionally, many drug companies offer discounts or coupons for some of their prescription drugs 
• These types of programs have different higher requirements than Medicaid and do not necessarily require you to spend down your assets to be eligible 
• If you think you might be eligible you should look into either the Low Income Subsidy (LIS) program which is offered through Social Security 
• Or the Medicare Savings Program (MSP) that is offered by your local county 
• Or even talk with your drug makers and see if they have additional discounts available to you

Missing initial enrollment period  when turning 65 

• Medicare enrollment runs on extremely specific time frames 
• The first-time frame that everybody in Medicare gets is the “Initial Coverage Election Period” (ICEP)
• This is a 7-month window that people have, to enroll into Medicare
• Which starts 3 months before their 65 birthday and runs through the month of their birthday and ends 3 months after their birthday, totaling 7 months 
• At any time, it is possible to enroll into a Medicare plan during this 7 month time frame
• And there will only be one chance to enroll
• If somebody miss the enrollment window, then they will not be able to enroll until January of the next year. 
• If you don’t get automatically enrolled, then you would need to actively apply in those 7 months around your birthday to ensure you do not miss your Initial Coverage Election Period and have to wait a year to get enrolled into Medicare 

Thank you so much for watching, if you have questions about your Medicare or Medicare health plan options please feel free to contact us and we can make a new post or video to cover your questions. We here at California know health insurance weather it is private health insurance, Medicare, Medicaid / Medi-Cal, Medigap or health insurance for your small business. It can be very confusing coming from your work insurance and trying to look at options on the private market or turning 65 and trying to figure out which Medicare option is best for you. That is exactly what we can do, we can walk you through your options and help you find the plans that fits your needs and your budget.