Medicare, the landmark health insurance program for those 65 and older, turned 50 on Thursday, July 30.

Medicar Happy Birthday

Some 55.2 million Americans are enrolled in the program and 91% of them say their experiences with the insurance have been positive. But anecdotal evidence suggests that many are nonetheless perplexed by what it does — and doesn’t — provide.

Medicare and its alphabet soup of parts is confusing to individuals when they first are eligible for the program. The success of the Medicare program and its related marketplaces depends on the ability of millions of consumers to make good decisions about complex insurance and plan options when they first enroll in Medicare and annually thereafter.

One surprise for many Americans is Medicare’s different areas of coverage. Though most do not have to pay a premium for Medicare Part A, which covers hospital stays, most will pay a monthly premium for Part B, which covers their doctors’ visits and other outpatient services.

Both Parts A and B may have co-payments or deductibles. And if you’re still working and receiving insurance coverage from your employer, you may want to put off enrolling in Part B because your income could lead to higher premiums.

A person pays for Part B and you pay for adding supplemental insurance of additional policies a consumer may acquire to help cover the cost of prescription drugs or pay for vision and dental services.

Most seniors are very grateful for Medicare, but it doesn’t cover everything. it’s important to start planning early and realize there’s going to be some cost. It isn’t all free.

A Merrill Lynch retirement study released in September 2014 found that fewer than 1 in 6 people who were in their 50s and not yet retired had calculated how much they might need to cover health or long-term care costs when they stopped working. It’s important to prepare for such expenses, understanding that Medicare is only one part of the equation.

A person is going to spend more on health care than they think and it’s a good idea to speak with a professional insurance advisor long before being on the cusp of retirement.

The Merrill Lynch study found that while only 37% of Americans in their 50s thought they might eventually need long-term care, 70% actually will. And Medicare doesn’t cover long-term care.

There’s a difference between medical care and long-term care — you grow elderly, can’t take a shower by yourself … and need assistance. So you need an insurance policy of some sort, or savings or a plan.

Long-term care policies can be expensive and difficult to get if you’re in poor health. But there are ways to try and pare the cost, such as opting out of inflation adjustments for the policy, or getting a life insurance policy instead that includes a rider to help cover part of the costs for long-term care. Another option to consider while you’re still working is a health savings account. All of these things are helpful.

It’s also important to do your homework before you become eligible for Medicare.

Individuals will want to understand when they should enroll, what decisions they need to make about drug coverage and supplemental insurance. And, this is especially important if the individual is turning 65 and still employed. There are specific rules about coordination of employer coverage and Medicare, and there can be adverse consequences if an individual contributes to a health savings account while on Medicare.

There are many educational resources. Consumers can go to for information. The National Council on Aging’s web tool “MyMedicareMatters” boils the program down, and its Medicare QuickCheck addresses consumers’ questions about their personal situation.