4 Decisions You Will Have To Make When You Enroll In Medicare

I just read an article that, in my opinion, is misleading and inaccurate.  The author starts off by saying, “When you apply for Medicare, you will be assigned to a Medigap or Medicare Advantage plan according to the CMS guidelines.”  That is an incorrect and misleading statement.

When you enroll in Medicare you will be assigned to Medicare A and Medicare B.  Medigap and Medicare Advantage are both options that are sold by private insurance companies.  In many cases, the insurance companies pay a commission to insurance agents to sell them.

I am convinced that a good insurance agent is worth the commission that he receives.  What I am against is the practice of misleading the public by saying things that are not true.

I was offended when the politicians and media were spouting their lies and half-truths during the Health Care Reform debates of 2009-2010.  They got their law but only by using tricks and deceit.

Only a few of them had any experience with the insurance industry before taking their cushy political jobs.  Until Barack Obama’s presidential campaign of 2008, few, if any, politicians knew anything about health insurance other than to give the doctor their ID card when they got sick.  In a couple of months, the entire congress was filled with insurance experts.

I find that offensive.  However, I find that when an insurance agent uses fear and misinformation to sell a policy even more offensive.  As a consumer, you deserve to know the truth and make an informed decision.

In this post I want to discuss some decisions you will have to make when you enroll in Medicare.


Medicare is rather odd.  Although the part of Medicare that pays for your doctor and out-patient treatment is optional, most Americans will find that when they enroll in Medicare, Part B is automatically assigned.  If you wish to opt out, you will be required to notify Medicare.

Be aware that if you opt out of Medicare B when you are first eligible, you will have to wait until the next Open Enrollment Period to opt back in to the program.  At that time you will be charged an additional 10% penalty on your Medicare B premium.


Prescription medications are not covered by either Medicare A or Medicare B.  If you want insurance to help you with your prescriptions, you will need to enroll in the optional Medicare D program.

Be aware that if you do not participate in the program when you are first eligible, Medicare charges you a penalty for each month that you could have been in the Medicare D program but elected not to participate.


Medicare Advantage replaces Original Medicare.  Rather than having the government administer your Medicare benefits, Advantage participants have elected to use private insurance companies to administer their benefits.

Advantage plans are required to provide the same level of insurance protection as Original Medicare, at the minimum.  Many plans provide extra benefits (i.e. dental, vision, fitness club membership) that are not available through Original Medicare.  Approximately 1/4 of people who are eligible for Medicare have elected to replace Original Medicare with a Medicare Advantage plan.

Be aware that Advantage plans normally are geographically limited.  If you spend large periods of time between two homes (i.e. winter in Florida and summer in Michigan) the Advantage program is probably not appropriate for you.


Medigap plans are also known as Medicare Supplement insurance.  They pay the  portion of your medical bills that Original Medicare does not.  For example, Medicare B only pays 80% of your doctor’s bill after you have paid your Medicare B deductible.  Medigap will pay that additional 20% for you.

If you only go to the doctor a couple of times each year, the 20% of the bill that Medicare leaves you to pay is nominal.  However, many people who participate in Medicare see the doctor much more than twice a year.  For them, that Medicare B co-insurance can add up to a significant amount.  Medigap pays that for them.

Be aware that Medigap is generally much more expensive than Advantage.  However, it gives you the freedom to use any doctor or hospital that accepts Medicare.


Transition into the Medicare system can be very confusing.  Medicare is similar but not identical to the health insurance program you have used your entire life. Be prepared to make some informed decisions when you enroll in Medicare.

If you understand how the program works and what decisions you have to make, no politician, pundit or insurance agent can lead you astray.