How Medicare Works With Social Security

A common question about how Medicare and Social Security benefits work…

I am confused about Medicare. I thought it was all free when I got my Social Security, and now I find out that I have to pay for it?

Medicare has four parts…

Part A

Part A is free. It is included with your Social Security retirement benefit when you are 65, and with your disability benefits stating with the third year of benefits. If you take your retirement benefit at a reduced level, before you are 65, you do not get Medicare right away.

Medicare starts at age 65. Part A is for hospital benefits, ambulance rides, and some other benefits. You should sign up for Medicare at age 65 even if you do not take your Social Security retirement benefit until you are at your full retirement age or even older, especially if you want the larger monthly amount.

Part B

Part B is for your doctor’s bills. You have to pay for Part B. There is a premium for Part B and the amount of the premium depends on your adjusted gross earnings for the second year before the current year. People who made more in earnings pay a higher premium. When you apply for Medicare, you are asked if you want Part B. Most people should say yes. If you get your primary care at the VA, you may not need this.

Medicare Part B has a deductible and a co-pay. Most people have a Medicare Supplemental insurance to pay for all or some of the deductible and co-pays. If you are poor enough, you can also get Medicaid, which pays the Medicare premium and all the other fees to health care providers.

Part C

Part C is what you should choose, along with Part B, if you want an HMO. The Part B premium pays for this. If you take Part C, the federal government pays the HMO a set amount of money every month for your care, whether you get any care or not. The amount of money paid depends on where you live and some other factors, but not on the amount of care you get. If you sign up for Part C, you usually have to go to the HMO doctors for care, although they may approve you seeing an outside doctor in special situations.

Part D

Part D is a prescription drug benefit. There are many insurance plans to consider for Part D, and you should consider the medicines you take before you pick the plan you want. There may be people at your nearby senior center who will explain the different plans and help you find the one that is best for you. Medicaid also pays for some medicines. You have to pay for Part D. Some Medicare supplemental insurance includes medicines.

The premium for Part B and the premium for Part D will be deducted from your Social Security benefit. If you do not receive a monthly Social Security benefit, you will have to pay these fees yourself.