Medicare is available to people aged 65 or older and people who meet specific criteria needed to qualify. Medicare Part A and Part B are known as Original Medicare. Medicare Part A offers hospital insurance while Part B provides medical insurance.
When they become eligible, most people enroll in Part A, while some may choose to delay Part B enrollment. Whether you need both parts depends on factors such as a group health plan, your healthcare needs, budget, etc.
Medicare Part A
Medicare Part A is the first part of Original Medicare. It offers hospital insurance and covers inpatient healthcare services. For most people, Part A is premium-free. Suppose you or your spouse have worked and paid at least 40 quarters of Medicare taxes. In that case, you are eligible to enroll in Part A without paying monthly premiums. However, there are other costs apart from the premium, such as the deductible, which must be paid every benefit period.
Suppose you do not sign up for Part A during your initial enrollment period. In that case, you may be faced with late enrollment penalties.
Medicare Part B
Part B makes up the second part of Original Medicare. It covers approved outpatient services such as preventive screenings, ambulance transportation and services, durable medical equipment, doctor visits, etc. Unlike Part A, Part B premiums must be paid as you cannot receive this part premium-free. However, if you fail to enroll when you are first eligible, then you may have to pay a late enrollment penalty.
Do You Need Both?
In certain cases, you will need to enroll in both Part A and Part B. For example, suppose you do not qualify for a special enrollment period. In that case, you will need to enroll in both parts when you become eligible to avoid the late enrollment penalty.
Overall, if you need both hospital and medical insurance, then it is advisable to enroll in both parts. However, suppose you have a group health plan which serves as your primary insurance. In that case, you can go ahead and enroll in Part A, delay your Part B enrollment, and qualify for a special enrollment period. This will allow you to enroll in Part B at a later time and not have to pay a late enrollment penalty.
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