As we find ourselves in the midst of Medicare Open Enrollment, a refresher on the basics of this national health insurance program is in order. Additionally, some changes for 2027 may affect you, your family, and your healthcare coverage choices.
What Is Medicare?
Medicare is a complex web of parts, options, and enrollment periods. Medicare generally provides health insurance for individuals age 65 and older, as well as certain younger people with qualifying disabilities or medical conditions. If you choose to enroll in Medicare Parts A and B when you first become eligible at age 65, the Initial Enrollment Period typically begins three months before the month you turn 65 and ends three months after the month you turn 65.
If you are approaching Medicare eligibility, review your enrollment timeline carefully. While enrollment rules remain largely unchanged, it’s important to understand your Initial Enrollment Period and avoid potential late enrollment penalties if you do not have other qualifying health coverage.
What Is Original Medicare?
Original Medicare’s Part A (hospital insurance) and Part B (medical insurance) generally cover about 80% of your Medicare-approved healthcare costs. For the remaining expenses, many Original Medicare participants purchase a Medicare Supplement (Medigap) policy along with a standalone Medicare Part D prescription drug plan. Most people qualify for premium-free Part A, while Part B requires a monthly premium that is adjusted annually.
What Is Medicare Advantage?
Medicare Advantage (Part C) is offered by private insurance companies and generally includes Parts A, B, and often Part D prescription drug coverage. These plans may have lower out-of-pocket costs than Original Medicare and often provide additional benefits such as vision, hearing, dental, and fitness programs. However, beneficiaries are usually limited to in-network providers and may need referrals to see specialists.
Because Medicare Advantage plans vary significantly by company and location, it is important to compare benefits, provider networks, prescription drug coverage, and costs before choosing a plan.
What Should I Know About Medicare Going In?
A common misconception about Medicare (whether you choose Original or Part C) is that it will pay for long-term (nursing home) care costs. Part A covers skilled nursing facility care – but only for short-term stays preceded by a qualifying inpatient hospital admission. The daily rate at the nursing home is covered in full for days 1-20; thereafter, you pay a coinsurance amount for days 21-100. After day 100, you are responsible for the full amount of nursing home costs – and per 2026 estimates from the Missouri Department of Health and Senior Services, the average cost for nursing home care in Missouri runs around $5,600 per month.
SAMPLE
When going through the Medicare enrollment process, take advantage of all resources available to you so you can make the best decision for your situation. In addition to consulting the Medicare & You handbook located online at medicare.gov, every state offers free personalized counseling. In Missouri, that is provided by Missouri SHIP, missouriship.org or 1-800-390-3330.
Fun Fact: Former President and fellow Missourian Harry S. Truman and his wife, Bess, were the first to receive Medicare registration cards after the program was enacted in 1965.
Learn More About Medicare With the Help of the Central Trust Company
Turn to the Central Trust Company for a professional second opinion about how Medicare-related expenses may fit into your broader financial plan. To get started, contact our team or find your nearest branch online today!
