Exploring the myths of Medicare

I have been following your Toni Says column in my local newspaper to learn about Medicare. This week I discovered online information discussing different myths of Medicare that confused me even more. I have Parkinson’s and want to be sure I make the correct choice.

I do not understand why I need to enroll in Medicare, since I have excellent company retirement health insurance. Please help me understand these Medicare myths. I appreciate your help.

--John, Las Vegas

Hello John:

Thank you for emailing the information regarding the myths of Medicare. My answers to the myths are below:

-- Myth 1: A person can enroll in Medicare any time after they are 65 without penalty.

FALSE!! This idea is wrong. If you are not working full-time for a company with true group benefits, or if you have an individual health insurance plan and wait later than 65 years old and 90 days to enroll in Part B, then you can receive the “famous” Medicare Part B penalty of 10% for each 12-month period or year that you did not enroll in Part B. That penalty lasts for the rest of your Medicare life. (John since you are not working full-time for the company, I would advise you to enroll in both Medicare Parts A and B for both to begin the 1st day of the month you turn 65, even though you will have retirement benefits when turning 65.)

Toni Says: If you or your spouse are not working full-time with true employer benefits, be sure to enroll in Medicare Parts A and B by the time you turn 65. If you wait 90 days past turning 65, you will get a penalty.

-- Myth 2: Medicare is free.

FALSE!! The Medicare payroll tax that you have been paying for years is for Medicare Part A only! Part B and Part D have a premium which is “means tested,” based upon your income and your spouse’s income (if you filed jointly). Most on Medicare are paying the minimum required each month for Part B, but 10-15% of Medicare beneficiaries meet the means-tested income amount and must pay more for their Medicare Part B and Medicare Part D premiums each month. If you do not pay the Part B or D premium, you will not have any of the Part B or D benefits.

Toni Says: Nothing is free!! You worked and paid taxes into the Social Security/Medicare systems.

-- Myth 3: Medicare is just like group or individual health insurance plans.

FALSE!! Original Medicare is completely different from group or individual health insurance. Medicare has two parts: A and B. Part A has a deductible that can be used up to six times a year for an inpatient hospital stay. Medicare Part B includes doctor’s services such as office visits, outpatient services and surgery, scans, x-rays, chemotherapy and radiation, wheelchairs, walkers, and the list goes on. Part B has a once-per-year deductible, with Medicare picking up 80% and you paying 20% of the Medicare-approved charges, with no co-insurance or stop-loss. Unlike the typical 80/20 to $5,000 with a stop-loss for employer benefits, with Medicare, the 20% just keeps on going! That’s correct, no stop-loss!

Toni Says: Original Medicare is completely different from health insurance, as we know it. The out-of-pocket costs can be huge.

John, you could have paid a penalty for the rest of your Medicare life if you had believed the Medicare myths. As we say at Toni Says, it’s what you DON’T know that will HURT YOU!

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Toni King is an author and columnist on Medicare and health insurance issues. She has spent nearly 30 years as a top sales leader in the field. If you have a Medicare question, email info@tonisays.com or call 832-519-8664. Toni’s books and her newsletter are available at www.tonisays.com. Toni’s new Confused about Medicare video series is now available for purchase at www.tonisays.com, as are Toni’s Medicare Survival Guide and discounted bundle package.