Medicare Part A is also known as “Hospital Insurance.” Medicare Part A helps senior citizens to pay for the costs of hospital services, nursing facility services or hospice care services.
A part of payroll taxes that every citizen pays is called Medicare tax, which is 1.45 percent of an employee’s wage. Medicare taxes help build a fund to pay for Medicare Part A benefits. For this reason, Part A benefits are free and enrollment is automatic. A self-employed individual who has not paid Medicare tax can buy Part A. In this case, he must either be 65 or older and enroll in Part B or be younger than 65 and have a disability.
Enrollment in Part A
Since Medicare Part A coverage is free to those seniors who have paid Medicare tax (or whose spouse has paid it), enrollment is automatic when an individual turns 65. Coverage starts on the first day of the month an individual turns 65. However, if a person turns 65 on the first day of the month, coverage starts at the first day of the previous month. A Medicare card is emailed to you three months before the month you turn 65, and you can start using your benefits as soon as you reach your birthday month.
Medicare Part B
Medicare Part B is also known as "Health Insurance." Part B helps senior citizens to pay for the health care they receive, such as fees for doctor visits, services fees, hospital outpatient care and home health care services. Part B also helps seniors to pay for some preventive services. Unlike Part A, Part B is not funded by the Medicare Tax. Thus, if a senior is interested in receiving Part B coverage, he must pay a monthly premium for it. For this reason, a senior can opt out of Part B coverage. However, enrollment is also automatic, and if a person is not interested she must contact Medicare and send back the Medicare card she received.
Enrollment in Part B
Even though Part B is not free, enrollment is automatic and it starts at the same time that Part A coverage starts. Your coverage starts on the first day of the month that you turn 65 or the first day of the previous month if your birthday is on the first day of the month. As with Part A, your Medicare card for Part B arrives three months before your 65th birthday, and your coverage is effective on the first of the month. However, as mentioned before, you can opt to drop Part B and send the card back.