No idea how Medicare works? 3 things all retirees should know.

Once you retire, you may find that a good number of your expenses begin to decrease. But if there is an expense, it is likely to do so growit’s healthcare.

That’s why it’s so important to read about Medicare before you retire. Knowing how the program works can help you better plan your medical costs. Here are some key points to be aware of if you feel like you’re in the dark.

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1. When eligibility begins

Eligibility for Medicare begins at age 65. However, the initial enrollment window spans seven months. It starts three months before the month you turn 65 and ends three months after that month.

If you don’t enroll in Medicare during that initial enrollment window, you may have to wait until the program’s general enrollment period, which runs from January 1 to March 31 each year. But waiting to enroll puts you at risk of surcharges on your Part B premiums for life. Unless you’re covered by an eligible group health plan (which usually means a plan with 20 or more employees), your best bet is generally to enroll in Medicare on time.

2. What is covered and what is not

Medicare covers a range of health care needs for seniors, from outpatient care to diagnostic exams to surgeries and hospital admissions. But there are a number of key health care services that Medicare won’t cover. These include dental care, eye exams and hearing aids.

while original Medicare will not pay for these services, many Medicare Advantage plans will. Medicare Advantage is an alternative to original Medicare and works similarly to health insurance plans that many people get through their employers.

With Medicare Advantage, you are generally limited to a specific network of health care providers. But you may find that your costs are lower as a Medicare Advantage member because you get coverage for a wider range of services.

3. What costs are involved

A big misconception about Medicare is that it provides free healthcare, which is far from true. While most enrollees do not pay a premium for Medicare Part A, which covers hospital care, there are out-of-pocket costs for a hospital stay.

This year, the hospital deductible for Medicare Part A is $1,632. And that only covers the first 60 days.

Meanwhile, Medicare Part B currently charges a standard monthly premium of $174.70. However, higher earners may be subject to surcharges on top of this amount. There’s also a $240 annual deductible that must be met in 2024 for Part B. Plus, on Part B, you’re often looking at a 20% coinsurance for the services you need.

Then there’s Medicare Part D, which covers prescription drugs. There is no standard monthly premium for Part D because it varies by plan. Even though some plans don’t charge a monthly premium, you should generally expect to pay something for coverage in addition to copays that depend on the plan you enroll in and the drugs you take.

If you enroll in Medicare Advantage, your costs will depend on your plan. Some Medicare Advantage plans have a $0 premium, but that doesn’t mean other out-of-pocket costs won’t occur as you use your coverage.

The more you know about Medicare before retirement, the more confident you can feel in your ability to cover your medical expenses as a senior. Even if you still have a few years of work ahead of you, it’s worth starting to read about Medicare and ways to maximize it.