Getting ready for retirement requires much preparation. And one very important piece of your plan is to choose your Medicare Plan wisely. However, Medicare coverage and choices can seem overwhelming. Because it is imperative to choose the best plan for your needs, its important to educate yourself about your Medicare choices before you choose a plan. First, you can start by becoming familiar with Parts A, B, C, and D of Medicare.

What are the different parts of Medicare, and what do they cover?

Medicare Part A (Hospital Insurance)

Part A covers inpatient hospital stays. It also covers care in a skilled nursing facility, hospice care, and some home health care.

Medicare Part B (Medical Insurance)

Part B covers certain doctors’ services, outpatient care, medical supplies, and preventive services.

What is Original Medicare?

Together, Part A & Part B are the combined health insurance product known as Original Medicare. It also serves as the foundation for private Medicare Advantage and Medicare Supplement plans.

Why do you need supplemental coverage?

Original Medicare does not cover prescription drugs. It also does not cover care outside of the U.S. And without supplemental coverage, you’ll have to pay out of pocket for deductibles and co-payments of up to 20 percent on Part B costs. A supplemental plan is an affordable way to cover these costs.

Medicare Part C (Medicare Advantage)

Medicare Advantage is offered through private companies approved by Medicare and is considered an all in one alternative to Original Medicare. These “bundled” plans include Medicare Part A and Part B and usually, Medicare Part D (Prescription Drug Plan). The premiums, copays, and deductibles of a Medicare Advantage Plan vary depending on the insurance company offering the plan. You should do your homework and compare all plan options before enrolling in a Medicare Advantage plan.

Medicare Part D (Prescription Drug Plan)

There are several different Part D plans offered, and they vary in cost and medications covered.  Monthly premiums for drug plans can also vary, even if coverage is similar.

Medicare Supplement (Medigap)

Medigap insurance helps cover the cost of expenses not covered in Part A and Part B. It can cover copays and excess hospitalization. Private companies sell Medicare Supplement Insurance. This makes policy costs vary depending on the insurance company and the state where you live.

Although Medicare covers a wide array of care, not everything is covered. Therefore, things like dental care, eye exams, hearing aids, etc. may not be covered. More importantly, long-term care is not covered by Medicare. If you think you or a loved one will need long-term care, consider a separate long-term care (LTC) insurance policy.

The government’s Medicare web site is easy to use and a great place to start educating yourself about your choices concerning Medicare. It will help provide you with information you need to ask the right questions and make the right decisions when enrolling in Medicare.