How to Make the Most of Medicare

MedicareIt's hard enough for retirees to juggle expenses without that regular paycheck they've been used to their whole lives. The financial challenges of retirement are even greater when you consider the increasing costs of health care.

Fortunately, the government's Medicare program offers help covering medical costs, and five years ago it added a prescription drug option to its coverage. Because prescription costs are such a big expense in retirement, if you're eligible for it, Medicare Part D can make a big difference in your pocketbook -- and help ensure your financial security throughout your golden years.

Here's a brief guide to your options and tips on how to get the most out of your coverage.

How Medicare Part D Works

As confusing as government programs can be, the idea behind Medicare drug coverage is simple. You can choose from a range of drug plans offered by different providers. Most of these providers charge a monthly or annual premium for their plans. Plans differ in how much they'll pay for drugs, which particular drugs they cover, and how much you'll have to pay out-of-pocket. Adding to the confusion, not all plans are available nationwide, so residents of a particular state may get shut out of a given plan.

What to Consider When Picking a Plan

With deadlines to pick a plan and penalties if you end up changing your mind, you need to be smart about getting it right the first time. Here are some things to keep in mind so you can do just that.

1. Consider your future needs.

On one hand, you want to pick a plan that will cover everything you need. Of course, it's impossible to know in advance what drugs you might need in the future. But if you look at what prescriptions you have now, it's a lot easier to figure out which plan will pay for them at the lowest cost.

2. Don't overpay for what you'll use.

At the same time, you also need to take into account the premiums you're paying. Sure, an ideal plan might pay for all of your prescription drugs. But if you have to pay hundreds of dollars in extra premiums for complete coverage, you could end up paying more in total than you would under a less-inclusive plan.

3. Use available tools to help you choose.

Medicare's website offers valuable information about prescription drug coverage, including a number of calculators and other tools to help you pick a plan. You can enter a list of your prescriptions, and the website will evaluate your plan options for you. Also, drug stores like Walgreens (WAG), CVS Caremark (CVS), and Rite Aid (RAD) have similar tools to help you evaluate plans and how your needs fit with them.

4. Get help if you can't afford coverage.

If you don't have much money, you might qualify for assistance for your drug coverage. Seniors with extremely limited incomes and financial resources may be eligible for low-income assistance with their prescription drug plan. Current income limits are $16,335 for unmarried seniors and $22,065 for married seniors who live together. Also, to be eligible, you can have no more than $12,640 in financial resources ($25,260 for married couples). But be sure to check the website, as certain types of income and assets don't count toward those totals -- in particular, your home.

Because making these calculations can get complicated, many people qualify for these savings and don't even know it. So before you conclude that you're not eligible, consider using the online application to determine your eligibility. You could end up saving an estimated $4,000 per year in prescription costs.

Motley Fool contributor Dan Caplinger hopes Medicare will still be around by the time he needs it. You can follow him on Twitter here. He doesn't own shares of the companies mentioned in this article.

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pdccac21

LET'S GET IT TOGETHER AND SOON. THE GOVERNMENT ISN'T LISTENING TO US SO WE NEED TO YELL LOUDER AND MORE FREQUENTLY MAYBE THEY WILL LISTEN TO US ONE DAY SOON WE HOPE TO GOD.

August 04 2011 at 7:20 PM Report abuse rate up rate down Reply
pdccac21

PETE

August 04 2011 at 7:16 PM Report abuse rate up rate down Reply
*Dottie*

Hey Government, Why do you never check the fraud in food stamps, They receive food stamps, and sell them for their DRUGS, but you never, never hear about any checking up on this disgrace, Hey Government get on the BALL.

August 04 2011 at 7:32 AM Report abuse +6 rate up rate down Reply
1 reply to *Dottie'*s comment
Mickylitz

Dottie,,,,

The whole welfare system needs to be totally overhauled, the temporary help for citzens down on their luck has become a way of life for millions and they ask for more while the poor working smuck pays the bills.
Come'on folks, get a grip and quit confusing and mixing compassion with stupidity.
Check out what New-York forks out for people who never lifted a finger to help themselves.
ASSISTANCE PROGRAM and ANNUAL AMOUNT: AFDC basic cash grant, $2,856; Medicaid, $13,664; Housing Assistance, $9,828; Food Assistance, $4,507; Energy Assistance, $1,716. TOTAL $32,571. Pre-Tax Equivalent of Welfare Benefit Level $44,900.
A hell of a lot of us had to live on much less while paying our own bills..............

August 04 2011 at 8:08 AM Report abuse +5 rate up rate down Reply
fakeconomics1

Bob Shull, Thank you for your post. As you have seen, Our Congress especially GOP and Tea Baggers are commited to export our jobs and reward TAX CHEATS, GREEDY OIL, CAYMAN ISLAND CORPORATE CHEATS!! Unless we as consumers unite and take control of our country--there will not be a chance to survive!!

August 03 2011 at 10:58 PM Report abuse -5 rate up rate down Reply
Bob Shull.

I am a 58 year old citizen that receives both medicare and medicaid.I was judged disabled(COPD) in 1999 and every day I Thank God for medicare and medicaid.Without that lifeline I would most probably be dead already.What disturbs me is the governments veiw on COLA.It's beyond hypocracy to say seniors and the disabled do not deserve cost of living increases when gas went from $1.35 a gallon to $3.65 a gallon. I don't want to sound like a crybaby because beleive you me I am TRULY grateful for the benifits I receive from our government,but,if the cost of living has not gone up I will kiss your rear end on mainstreet and give you a week to draw a crowed to watch.Please don't try to tell me that tax loopholes and breaks for big business and The very rich are any thing other than all our COLA's for the last two years.I beleive in paying your FAIR share as I did for over 45 years And I am proud to live and breath here in America.Let's all get on board and quit being so greedy.Thanks.

August 03 2011 at 10:42 PM Report abuse +3 rate up rate down Reply
fakeconomics1

Hey my fellow Americans-----It is you!! Stop bitching and take control of our country!!

August 03 2011 at 10:02 PM Report abuse +3 rate up rate down Reply
1 reply to fakeconomics1's comment
savemycountry911

Stop bitching like you?

August 03 2011 at 10:06 PM Report abuse -2 rate up rate down Reply
fakeconomics1

Our People must control thier own destiny-----Not---Congress----DEMS---GOP---TEA PARTY----SUPREME COURT----MEDIA------Say no to IMPORTS!!! Say Yes----Products Made in America!!!

August 03 2011 at 10:00 PM Report abuse +2 rate up rate down Reply
1 reply to fakeconomics1's comment
savemycountry911

Certainly not the looney lib Dems.

August 03 2011 at 10:03 PM Report abuse +5 rate up rate down Reply
fakeconomics1

Folks-----I want to talk to you without fear----I may lose my account but I want to be free------I ask all American Voters to look at themseves in the mirror!! What you see? A bunch of cowards!!! A bunch of lost souls!!---------You asked for it---and you are getting it!!! You fools! You made China, India, Brazil and many other countries rich at the cost of American Consumers!! and by exporting American Technology and Jobs In the name of Capitalism, Free Trade, and Freedom!! Our Greedy Businesses conquered DEMS and GOP!! Both Parties sacrifieced American Consumers!! Just to get re-elected!! Just to punish Unions!! and American Consumers!! This Supreme Court stated that Bribes are Freedom Of Expression!! They Thought it was/ it is Conservatism!! Our Congress and GOP thought giving Tax Breaks to Tax Cheats is Conservatism!! They thought trapping and Looting American Consumers is Conservatism!! When Americans in millions poured billions and billions of dollars into Social Security and Medicare---They thought it is welfare?? Now what you do stupid voters?? Our Congress---Dems---GOP---Supreme Court is siding with Greedy Corporations, Tax Cheats and Communist Countries??----Hey People----you get what you pay for??

August 03 2011 at 9:56 PM Report abuse -1 rate up rate down Reply
2 replies to fakeconomics1's comment
savemycountry911

Tax cheats like Obummer's cabinet?

August 03 2011 at 10:04 PM Report abuse +5 rate up rate down Reply
LEE Resolution

have you any idea how silly and stupid this comment is ?

August 04 2011 at 7:38 AM Report abuse rate up rate down Reply
fakeconomics1

Democrates, Republicans, Tea Baggers, NRA, Greedy Oil, Greedy Banks, American Chamber of Commerce, The Supreme Court, Greedy Banks, Lobbyists, Day Traders and STUPID VOTERS have RUINED MY COUNTRY!!!

August 03 2011 at 9:16 PM Report abuse -1 rate up rate down Reply
1 reply to fakeconomics1's comment
savemycountry911

and welfare bums.

August 03 2011 at 10:04 PM Report abuse +1 rate up rate down Reply
martinsportraits

The Brain dead senior citizens of this country who overwhelmingly vote republican will soon see their medicare and Social Security benefits cut dramatically by the GOP , If the next president Is A Neo Nazi Republican Like Mitt Romney , Its going To be Funny Watching these old folks eating cat food in the Gutter, At least the GOP will make sure the Billionares continue to get their huge tax breaks ....so its all for a good cause!!!!!

August 03 2011 at 8:20 PM Report abuse -7 rate up rate down Reply
3 replies to martinsportraits's comment