Medicare and Social Security Disability Benefits

Applying for Social Security Disability Insurance (SSDI) benefits early is very important. The sooner you apply, the sooner you can start receiving the benefits you are entitled to. An important benefit you don’t want to miss out on is qualifying for the federal Medicare program.

Most people know that qualifying for Medicare is primarily based on age and available to those who are 65 or older. More importantly here, though, Medicare is also available to those under age 65 who have received SSDI benefits for 24 months. A Medicare card, along with an explanation of enrollment details, is automatically mailed to you once you become eligible for Medicare benefits.

As a SSDI beneficiary, you may qualify for Medicare even sooner. The eligibility for those with ALS, or Lou Gehrig’s Disease, starts the first month SSDI benefits are received. Those with end-stage renal disease or kidney failure qualify after the third month. Also, an SSDI beneficiary under 65 is eligible for Medicare in the month in which they receive a kidney transplant.

It’s important to keep in mind that qualifying for Medicare as an SSDI beneficiary takes a long time. Because of the five-month waiting period from the start of the disabling condition for individuals to qualify for SSDI benefits, this time is added to the 24 month period for becoming eligible for Medicare benefits. So at the earliest, Medicare coverage cannot start sooner than the beginning of the 30th month after the start of the qualifying disability.

Medicare options. Finding out about your available Medicare options is as easy as learning your A, B, C’s (and D’s). But those who have a disability often unknowingly choose the least helpful Medicare program, so read on with care about the alphabet soup of available Medicare options:

Medicare Part A (Hospital Insurance): Benefits here include hospitalization, limited skilled nursing facility care, home health care, hospice care and blood. Enrollment is automatic once Medicare eligibility requirements are met. Part A coverage costs nothing, except your deductibles or co-payments, and coverage gaps must be paid by you or covered by other insurance (Medicare Part B and Medigap or Medicare Supplement Insurance, an optional health insurance policy that you may buy from private insurers).
Medicare Part B (Medical Insurance): Used together with Part A (known as the original Medicare plan), benefits here include such items as doctors’ services; outpatient medical, hospital and surgical services; clinical laboratory services; home health care; blood and various preventive services. If you want Part B coverage, you generally must sign up for it during your initial enrollment period. Otherwise you can only sign up for it during the general enrollment period (January 1 through March 31 of each year) or during a special enrollment period (up to eight months after you or your spouse lose employer health coverage or either of your employment ends, whichever is first).

The monthly cost (or premium) for Part B coverage is tied to your annual income and adjusted each year. If you already have Medicare and your premiums are deducted from your Social Security checks, Part B coverage is generally $96.40 per month in 2010 for individuals with $85,000 annual income or couples with $170,000 annual income.

If you are new to Medicare or do not have your Medicare Part B premium deducted from your Social Security checks and make $85,000 annually as an individual or $170,000 annually as a couple, your premium will generally be $110.50. If you have income greater than $85,000 annually as an individual or $170,000 annually as a couple, your premium may be higher.

If you don’t sign up for Part B when originally eligible, there is a premium surcharge (translation, a penalty) of 10 percent for each 12 month period you could have had it, but didn’t. This is bad because the extra amount must be paid for as long as you have Part B.

As with Part A, there are deductibles and co-payment/co-insurance payments. These may be covered by paying for an optional Medigap policy from a private insurer.

Medicare Part C (Medicare Advantage): Part C is an alternative to Parts A and B. This type of plan is offered by private insurance companies that contract with Medicare to provide all Medicare Part A and Part B benefits. At a minimum, these plans cover all Medicare Part A and B services. In most cases, there are extra benefits and lower co-payments than in the original Medicare plan. In addition, most Medicare Advantage Plans offer prescription drug coverage. The costs of Medicare Advantage plans vary depending on the services offered.
Medicare Part D (Prescription Drug Coverage): Medicare Part D provides brand-name and generic prescription drug coverage insurance. These plans are run by private companies that are approved by Medicare. Part D coverage is optional and available to those enrolled in traditional Medicare (Parts A and B) or Medicare Advantage plans that don’t offer prescription drug coverage.

To better understand your Medicare plan options and how everything fits together, here is a summary of the choices and paths for you to make:

Available Medicare Health Plan Options Choose One of Two Possible Coverage Paths
Traditional Medicare Plan	Medicare Advantage Plan
- Coverage provided by Medicare - Includes Part A (Hospital) and Part B (Medical) - Deductibles, coverage, and costs are standardized	- Private insurers approved by Medicare provide this coverage - Includes everything offered by Medicare Parts A and B - Usually includes extra coverage not offered by Parts A and B - Costs, extra benefits, and details vary by plan - Can’t be turned down for coverage
Prescription Drug Coverage - Decide if you want to join separate Medicare Part D - Plans run by private Medicare approved insurers - If no choice is made, you pay entire prescription costs	Prescription Drug Coverage - Most Medicare Advantage plans already include this coverage - If not, you can still join a traditional Medicare Part D plan separately - Without drug coverage, you pay entire prescription costs
Supplemental Coverage - Decide if you want supplemental coverage, like a Medigap policy, to pay for gaps in Parts A and B coverage - Offered by private insurance companies - Costs and coverage varies by policy and company - Similar coverage may be offered by employers or unions - Medigap policies may exclude coverage for pre-existing conditions	Supplemental Coverage - With Medicare Advantage plans, you don’t need and can’t buy a a Medigap policy - If you already have a Medigap policy, you can keep it, but Medigap won’t pay for any co-payments or other plan costs

Though your Medicare plan options may appear straightforward, there are still many issues for you to consider. Allsup provides you with additional help understanding the Medicare benefits available to you:

Medicare FAQs: Your most frequently asked questions about Medicare are answered here.
Medicare Advantage Plans: Learn why Medicare Advantage plans offer the most complete coverage available for those receiving SSDI benefits.
Medigap: Though generally not the best option for SSDI recipients, we cover the basics of Medicare supplement insurance here for those who want it.
Medicare and the ARRA: Learn whether the American Recovery and Reinvestment Act of 2009 impacts your Medicare coverage options.
Maximizing Your Medicare Drug Costs: Find out more about the Medicare prescription drug coverage gap or "donut hole" and what you can do to avoid thousands of dollars in potential out-of-pocket costs.
Medicare Savings Programs: States have programs for people with limited income and resources to pay for some or all of their Medicare premiums, plus Medicare deductibles and co-insurance. Find out what these programs are and if you qualify.