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New to Medicare

May 21, 2024 | Shea Corti

Medicare is the federal government program that provides health care coverage, or health insurance. The Centers for Medicare & Medicaid Services (CMS) is the federal agency that runs Medicare. The program is funded in part by Social Security and Medicare taxes you pay on your income, in part through premiums that people with Medicare pay, and in part by the federal budget. Some people are eligible for Medicare due to their age, while others are eligible due to having a disability or chronic condition. If you are new to Medicare, there can be a lot to learn around your enrollment and coverage choices

First, know when to enroll in Medicare Parts A and B.

Part A generally covers inpatient care, and Part B generally covers outpatient care. Some people are automatically enrolled in Medicare Parts A and B. For example, if you are already receiving retirement benefits from Social Security when you become Medicare-eligible, or if you’ve been collecting Social Security Disability Insurance for two years. If you are automatically enrolled, you should receive a package in the mail with your Medicare insurance card telling you so. Otherwise, there are three times to enroll in Parts A and B:

  • First, during your Initial Enrollment Period, or IEP, which is the three months before, the month of, and the three months after your 65th birthday.
  • Second, during a Special Enrollment Period, or SEP, which allows you to delay Medicare enrollment without paying a penalty. For example, many people delay enrolling in Medicare because they or their spouse are still working, and they are covered by employer coverage. An SEP allows them to enroll in Medicare without penalty.
  • Third, the General Enrollment Period, or GEP, which is every year from January 1 through March 31. Using the GEP isn’t ideal, because you may owe a late enrollment penalty and face gaps in coverage.

Note that if you qualify for premium-free Part A, which most people do, you can enroll in it at any time once you are eligible. You must use applicable enrollment periods to enroll in Part B or premium Part A.

If you are unsure of whether you qualify for an SEP or should use your IEP, contact your local State Health Insurance Assistance Program (SHIP). SHIP counselors are government funded to provide trusted, unbiased Medicare counseling at no cost to you. (Depending on your state, your SHIP may go by another name.) Use our online SHIP Locator or call 877-839-2675 (and say “Medicare” when prompted) to find your local SHIP.

Next, choose between Original Medicare and Medicare Advantage

Unless you choose otherwise, you will have Original Medicare. You can instead choose to get your Medicare through a Medicare Advantage Plan, which is a private health plan. Here are some differences to consider:

  • With both options, you must pay your Part B premium (and your Part A premium if you have one), but you may also owe an extra premium for your Medicare Advantage Plan.
  • A Medicare Advantage Plan usually includes prescription drug coverage, called Part D. If you have Original Medicare, you must enroll in a separate Part D plan if you want prescription coverage.
  • You may have more flexibility in seeing providers with Original Medicare, since there are no provider networks, no requirements to get referrals to see specialists, and most doctors in the country accept it.
  • A Medicare Advantage Plan may offer supplemental benefits like dental, vision, or hearing coverage.
  • You can purchase a Medigap if you have Original Medicare, which covers Medicare cost-sharing.
Finally, consider enrolling in a Part D plan or Medigap.

Part D prescription coverage is provided only through private insurance companies that have contracts with the federal government. If you have Original Medicare and want to get Part D coverage, you must choose and enroll in a stand-alone prescription drug plan. You should sign up for Part D when you first become eligible to enroll in Medicare unless you have other creditable drug coverage. Most Medicare Advantage Plans include drug coverage.

Medigaps are health insurance policies that offer standardized benefits to work with Original Medicare, not with Medicare Advantage. They are sold by private insurance companies. If you have a Medigap, it pays part or all of certain remaining costs after Original Medicare pays first. Medigaps may also cover emergency care when travelling abroad. It’s important to know that you should usually enroll in a Medigap during your federal Medigap open enrollment period: a one-time, six-month period that begins the month you are 65 or older and enrolled in Medicare Part B. Depending on your situation and the state in which you live, you may be able to enroll at other times, too.

To discuss your enrollment options—from Original Medicare and Medicare Advantage to drug plan and Medigaps—contact your SHIP. Use our online SHIP Locator or call 877-839-2675 (and say “Medicare” when prompted) to find your local SHIP.

Still have questions?   

Your SHIP is here for you! You can contact your SHIP for any Medicare-related questions or concerns you have. SHIP counselors are government funded to provide trusted, unbiased Medicare counseling at no cost to you. (Depending on your state, your SHIP may go by another name.) Use our online SHIP Locator or call 877-839-2675 (and say “Medicare” when prompted) to find your local SHIP.

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