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Making Medicare work for you

Getting older does have its perks, one of which is qualifying for Medicare, the federally sponsored health-insurance program.

For starters, there are two basic parts of Medicare: Part A and Part B.

If you've accumulated at least 40 work credits, the equivalent of about 10 years of employment, your Part A coverage is taken care of. If that's not the case, then you'll have to buy it separately.

Part B, on the other hand, pays for doctor's visits, lab work and tests. Part B, which is based on income, is generally paid for via retirees' Social Security checks.

While many seniors go this route, a growing number are choosing Medicare Advantage plans, with over 17 million enrolling in them last year. These are plans from private insurers that can add more coverage such as vision, dental or prescription benefits.

Should you jump on the bandwagon?

The supplemental plans can have lower copayments and more predictable costs, although it's important to compare different options before you enroll, according to Fred Riccardi, the director of client services at Medicare Rights Center, a national consumer group.

With original Medicare, enrollees generally can see any doctor and use any hospital they want. However, original Medicare will only cover 80 percent of your costs.

Medicare Advantage works a little differently. With this coverage you have to use a provider that is in your network and you have a deductible to pay before your plan kicks in. There often are modest monthly premiums. The federal government estimated that the average Medicare Advantage monthly premium was about $32.60 in 2016.

Assuming you stay within the network, Medicare Advantage plans are required to limit out-of-pocket expenses to no more than $6,700 — after that you should be covered at 100 percent.

One other option

Since original Medicare only covers 80 percent of your costs after you reach your deductible and has no out-of-pocket maximum, that means that if, for example, you need a surgery that costs $50,000, you could be on the hook for more than $10,000.

If that scares you, there's another option in addition to Advantage plans — buying supplemental insurance to help cover health costs like copayments, coinsurance and deductibles, called Medigap. Generally, when you buy a Medigap policy you must have Medicare Part A and Part B but these policies come with their own monthly premiums, which vary by region and state.

To weigh what's best, go to Medicare.gov or your State Health Insurance Assistance Program, which provides free counseling to help find the right plan.

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