5 Things to Know to Reduce Your Tax on Capital Gains
Although it is often said that nothing is certain except death and taxes, the one tax you may be able to avoid or minimize mo...
Read moreMedicare is a federally run health insurance program that serves seniors (age 65 and up). The program also covers people of any age who are permanently disabled or who have end-stage renal disease (people with kidney ailments requiring dialysis or a kidney transplant) or Lou Gehrig’s disease (ALS).
Medicare insures more than 66 million Americans and, as of 2023, spent more than $1 trillion a year on their care. Medicare is an entitlement program, meaning it is not based on financial need.
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Each year, Medicare issues a comprehensive handbook detailing all aspects of the program.
Many believe Medicare is provided at no cost, but this is not accurate. Although Medicare was originally conceived as a program that would relieve seniors of the burden of paying for health care, Medicare beneficiaries now pay a greater percentage of their incomes for out-of-pocket health care expenses than they did before Medicare was enacted in 1965.
In addition to paying a monthly premium, Medicare recipients often must pay a portion of the cost of the services they receive in the form of a deductible or coinsurance amounts. Deductibles, coinsurance, and premiums typically increase each January.
Many services and items, such as long-term unskilled nursing home or in-home care, are not covered by Medicare. To help with this cost-sharing and the items that Medicare does not cover, Medicare beneficiaries often purchase private insurance policies called Medigap policies.
Generally, Medicare pays only for “acute” care – care that the program views as reasonable and necessary to diagnose or treat an illness or injury. It does not pay for most preventive care or unskilled care to treat chronic conditions.
Medicare consists of four major programs:
Sometimes referred to as hospital care or hospital insurance, Medicare Part A covers inpatient health care costs. This includes inpatient hospitalization, rehabilitation services, skilled nursing facility services, and aspects of home hospice care. (Together, Part A and Part B comprise what is often called Traditional, or Original, Medicare.)
Eligibility for Part A begins at age 65. If you currently receive Social Security retirement or disability benefits, your enrollment in Part A is automatic.
The costs for Medicare Part A in 2025 are as follows:
Medicare Part B focuses on outpatient medical care and preventative care. It covers a range of outpatient surgeries, cognitive assessments, medically necessary treatments, medical equipment such as walkers, and vaccinations; an initial Welcome to Medicare health visit; and an annual wellness visit. (As mentioned above, Part A and Part B together make up Traditional, or Original, Medicare.)
You become eligible for Part B when you are 65. As with Part A, if you are receiving Social Security retirement or disability benefits, your enrollment in Part B is automatic. (If you are still working and have an employer or union group health insurance plan, you may not need to enroll immediately. However, beware of the late enrollment penalty.)
Costs for Medicare Part B in 2025 include:
Medicare Part C, also known as Medicare Advantage or managed care, is an alternative to Traditional Medicare (Parts A and B). Part C plans are offered by private insurers that contract with Medicare, so the coverage benefits – as well as the costs – will vary according to the specific Medicare Advantage plan you choose.
If you have Medicare Parts A and B (Traditional Medicare), you do have the option to join a Medicare Advantage (Part C) plan instead. However, once enrolled in a Medicare Advantage plan, you can change your plan only at certain times of the year. (For more information, refer to the section below titled When You Can Sign Up for Medicare.)
Again, Part C costs may vary widely depending on the plan you select. Nationwide, the average monthly premium for a Medicare Advantage plan is currently $17 but can be as high as $200 or more a month. Out-of-pocket costs can also differ from one Medicare Advantage plan to the next.
Medicare Part D encompasses coverage for most prescription drugs. Although you may not yet rely on any prescriptions, you might in the future. So, consider enrolling in Part D prescription drug coverage when you are first eligible, as it’s possible you could face a permanent late enrollment penalty if you wait too long.
Part D is available only through private insurers. The monthly cost can vary, as there are various plan options available.
You can obtain Medicare drug coverage through Medicare Part D or you may find that it is included as part of your Medicare Advantage plan.
Generally, once you turn 65 years old, you are eligible for Medicare coverage. Several months before your 65th birthday, you’ll receive a “Welcome to Medicare” packet that will outline the enrollment process.
Numerous resources are available to address your questions regarding Medicare:
Although it is often said that nothing is certain except death and taxes, the one tax you may be able to avoid or minimize mo...
Read moreMedicare Part A covers institutional care in hospitals and skilled nursing facilities, as well as certain care given by home...
Read moreThe Medicare prescription drug plan (Medicare Part D) allows private health insurers to offer limited insurance coverage of p...
Read moreIn addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. Coverage in your state may depend on waivers of federal rules.
READ MORETo be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). Special rules apply for the home and other assets.
READ MORESpouses of Medicaid nursing home residents have special protections to keep them from becoming impoverished.
READ MOREIn addition to nursing home care, Medicaid may cover home care and some care in an assisted living facility. Coverage in your state may depend on waivers of federal rules.
READ MORETo be eligible for Medicaid long-term care, recipients must have limited incomes and no more than $2,000 (in most states). Special rules apply for the home and other assets.
READ MORESpouses of Medicaid nursing home residents have special protections to keep them from becoming impoverished.
READ MORECareful planning for potentially devastating long-term care costs can help protect your estate, whether for your spouse or for your children.
READ MOREIf steps aren't taken to protect the Medicaid recipient's house from the state’s attempts to recover benefits paid, the house may need to be sold.
READ MOREThere are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home.
READ MORECareful planning for potentially devastating long-term care costs can help protect your estate, whether for your spouse or for your children.
READ MOREIf steps aren't taken to protect the Medicaid recipient's house from the state’s attempts to recover benefits paid, the house may need to be sold.
READ MOREThere are ways to handle excess income or assets and still qualify for Medicaid long-term care, and programs that deliver care at home rather than in a nursing home.
READ MOREMost states have laws on the books making adult children responsible if their parents can't afford to take care of themselves.
READ MOREApplying for Medicaid is a highly technical and complex process, and bad advice can actually make it more difficult to qualify for benefits.
READ MOREMedicare's coverage of nursing home care is quite limited. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid.
READ MOREMost states have laws on the books making adult children responsible if their parents can't afford to take care of themselves.
READ MOREApplying for Medicaid is a highly technical and complex process, and bad advice can actually make it more difficult to qualify for benefits.
READ MOREMedicare's coverage of nursing home care is quite limited. For those who can afford it and who can qualify for coverage, long-term care insurance is the best alternative to Medicaid.
READ MOREDistinguish the key concepts in estate planning, including the will, the trust, probate, the power of attorney, and how to avoid estate taxes.
READ MORELearn about grandparents’ visitation rights and how to avoid tax and public benefit issues when making gifts to grandchildren.
READ MOREUnderstand when and how a court appoints a guardian or conservator for an adult who becomes incapacitated, and how to avoid guardianship.
READ MOREWe need to plan for the possibility that we will become unable to make our own medical decisions. This may take the form of a health care proxy, a medical directive, a living will, or a combination of these.
READ MOREDistinguish the key concepts in estate planning, including the will, the trust, probate, the power of attorney, and how to avoid estate taxes.
READ MORELearn about grandparents’ visitation rights and how to avoid tax and public benefit issues when making gifts to grandchildren.
READ MOREUnderstand when and how a court appoints a guardian or conservator for an adult who becomes incapacitated, and how to avoid guardianship.
READ MOREWe need to plan for the possibility that we will become unable to make our own medical decisions. This may take the form of a health care proxy, a medical directive, a living will, or a combination of these.
READ MOREUnderstand the ins and outs of insurance to cover the high cost of nursing home care, including when to buy it, how much to buy, and which spouse should get the coverage.
READ MORELearn who qualifies for Medicare, what the program covers, all about Medicare Advantage, and how to supplement Medicare’s coverage.
READ MOREWe explain the five phases of retirement planning, the difference between a 401(k) and an IRA, types of investments, asset diversification, the required minimum distribution rules, and more.
READ MOREFind out how to choose a nursing home or assisted living facility, when to fight a discharge, the rights of nursing home residents, all about reverse mortgages, and more.
READ MOREUnderstand the ins and outs of insurance to cover the high cost of nursing home care, including when to buy it, how much to buy, and which spouse should get the coverage.
READ MOREWe explain the five phases of retirement planning, the difference between a 401(k) and an IRA, types of investments, asset diversification, the required minimum distribution rules, and more.
READ MOREFind out how to choose a nursing home or assisted living facility, when to fight a discharge, the rights of nursing home residents, all about reverse mortgages, and more.
READ MOREGet a solid grounding in Social Security, including who is eligible, how to apply, spousal benefits, the taxation of benefits, how work affects payments, and SSDI and SSI.
READ MORELearn how a special needs trust can preserve assets for a person with disabilities without jeopardizing Medicaid and SSI, and how to plan for when caregivers are gone.
READ MOREExplore benefits for older veterans, including the VA’s disability pension benefit, aid and attendance, and long-term care coverage for veterans and surviving spouses.
READ MOREGet a solid grounding in Social Security, including who is eligible, how to apply, spousal benefits, the taxation of benefits, how work affects payments, and SSDI and SSI.
READ MORELearn how a special needs trust can preserve assets for a person with disabilities without jeopardizing Medicaid and SSI, and how to plan for when caregivers are gone.
READ MOREExplore benefits for older veterans, including the VA’s disability pension benefit, aid and attendance, and long-term care coverage for veterans and surviving spouses.
READ MORE