Medicare
The federal health-insurance program for people 65 and older and some younger people with disabilities.
What does medicare mean?
Medicare is funded partly by the 1.45% Medicare payroll tax (2.9% for the self-employed), which — unlike Social Security tax — has no wage cap, plus an extra 0.9% on high earners. Its parts cover hospital care (A), medical services (B) and drugs (D); after 65 you can pay Part B and D premiums tax-free from an HSA.
Put it to use
Related terms
Medicare — frequently asked
What are the parts of Medicare?
Part A covers hospital care, Part B covers doctors and outpatient care, Part C (Medicare Advantage) bundles A and B through a private plan, and Part D covers prescriptions. Many people add a Medigap policy to fill gaps.
When should I enroll in Medicare?
Your initial window spans the three months before through three months after you turn 65. Enrolling on time avoids lifelong late penalties, unless you are still covered by qualifying employer insurance and delay under the rules.