Here are 6 things you’ll want to know about Original Medicare so that can save money and time.

1) Medicare is NOT Medicaid

Many people confuse Medicare with Medicaid. Medicaid is a free or low-cost health coverage or Americans who are in financial need; whereas, Medicare is a program for Americans 65 and over, and for some persons under 65 with certain disabilities. You can have Medicare and Medicaid at the same time; however, you’ll want to read about how Medicaid can affect ownership of property.

2) Medicare is NOT Free

Many people think once they turn 65 they get free healthcare through Medicare. This is not true. Not only are you responsible for monthly premiums*, you are also responsible for out of pocket health costs such as deductibles, copays, and coinsurance. Click here to Medicare 2015 costs at a glance.

*While most people do not pay for their Part A premium, most people are responsible for their Part B monthly premium.

3) Medicare does NOT Cover Most Drugs

While some drugs that are administered by a health care professional or used with durable medical equipment are partially covered by Medicare Part B, prescriptions drugs are generally not covered by Original Medicare. To be fully covered you’ll want to look into a prescription drug plan, aka Medicare Part D.

4) Medicare Penalizes you if you Enroll Late

Medicare will monetarily penalize you if you enroll after you are first eligible. For most people, their initial enrollment is a 7 month period that begins 3 months before their 65th birthday month. If you wait, Part A, B, and D have different penalties:

  • Part A penalty: 10%. You will be responsible for this for 2x’s the amount of years you could have been enrolled but weren’t.
  • Part B penalty: 10% for each 12 month period you could have been enrolled but weren’t. You will be responsible for the entire time you have Part B.
  • Part D penalty: 1% for each month you could have been enrolled but weren’t. You will be responsible for this for the entire time you have Part D.

5) Medicare Part C is NOT Original Medicare

Medicare Part C is not Original Medicare, instead it is called Medicare Advantage. If you choose to enroll in a Medicare Advantage plan, all of your Part A and B health care needs will be covered through your private insurer (with the exception of hospice care, which is still covered by Original Medicare). Remember, MA plans’ coverage for your health care services can vary from how Original Medicare covers you.

6) With Medicare you are NOT Fully Covered

Like we discussed above, Original Medicare still leaves coinsurance, deductibles and copays, what we didn’t discuss is that Medicare does not put a limit on how much you could spend on out of pocket costs per year. Needless to say, this can really add up (read how much it would cost for your Part B drugs). To help cover your costs, you may want to look into Medigap which covers part or all of your Original Medicare costs.

For further questions about Medicare call 800-930-7956 or click here to get a Medicare health plan quote.