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Vanguard’s 3 Steps to Maximizing Your Medicare Coverage


When it comes to Medicare, understanding your healthcare needs and finding the right coverage are essential. But as you get close to or enter retirement, making decisions about your health can be overwhelming. To make the process a little easier, Vanguard recently released three tips on how to maximize your Medicare coverage. We’ll go over what Vanguard has to say and what it means for your well-being.

If you’re looking for a qualified financial advisor, SmartAsset’s free tool can match you with up to three financial advisors who serve your area.

1. Analyze yourself and your Medicare coverage

Choosing Medicare coverage is not a simple task. In fact, many folks lack a full understanding of Medicare.

According to a 2022 survey from Sage Growth Partners and Healthpilot, only 20% of Medicare-eligible individuals have a good understanding of original Medicare. And just 31% have a good understanding of Medicare Advantage.

But there are ways to reduce the odds that you’ll choose the wrong Medicare coverage. One of the first steps is analyzing your health. According to Vanguard, it’s important to take time to decide what type of Medicare coverage is important to you. Start comparing different Medicare coverage options and make your decision based on which features match your personal health profile.

2. Identify your priorities

SmartAsset: Vanguard's 3 steps to getting the best out of your Medicare coverage

Affordability and flexibility with Medicare options play a role in your coverage choices. If you are a relatively healthy person and don’t go to the doctor often, you may prioritize affordability over flexibility.

If you go to the doctor frequently, you may appreciate flexibility in coverage despite a higher cost.

Vanguard suggests that you consider looking at coverage options that use provider networks. Those plans, however, can limit treatment options. This may be beneficial for those who have relatively good health. A health maintenance organization (HMO) plan can be helpful as out-of-pocket costs are often low.

preferred provider organization (PPO) plan often offers out-of-network providers, which is more flexible than an HMO. Accessing those providers, however, can come at an additional cost, depending on the situation. A PPO may benefit someone who seeks additional medical care with his or her coverage.

3. Enroll on time and get your policies in order

Enrolling in your Medicare coverage on time is critical. And you need to do that before you reach the age of 65 since that age is when you become eligible for Medicare. By then, you should be able to identify which Medicare coverage best fits your health and financial situation. There is a seven-month enrollment timeframe that begins three months before your birth month and lasts three months after your birth month.

According to Vanguard, the best time to enroll for Medicare coverage is three months before your birth month. If you miss that timeframe, you could face delays in your Medicare coverage.

And if you don’t enroll by the age of 65, you could also be dealing with gaps in coverage and premium penalties.

Getting ready for enrollment for Medicare coverage isn’t just about your health, your resident standing in the U.S. matters, too. If you are a recent U.S. citizen or a permanent legal resident, you have to have that standing for at least five years before enrolling in Medicare coverage.

Bottom Line

SmartAsset: Vanguard's 3 steps to getting the best out of your Medicare coverage

Take the time to compare which Medicare coverage options fit your health and financial profile. Reviewing multiple network options such as HMO or PPO providers will help you understand whether affordability or flexibility matters to you. And enrolling on time so that you avoid gaps and penalties in coverage will go a long way in helping you keep Medicare costs low.

Medicare Planning Tips

  • It’s important to remember that Medicare coverage isn’t available until the year you turn 65. If you’re planning to retire at 55 or even 45, then you’ll need to decide what to do about health insurance until you’re Medicare-eligible. You may be able to continue your former employer’s coverage through COBRA but there’s a timeline for how long you can do that. So as you’re making your retirement budget, think about where health insurance and health care fit in.
  • Consider talking to a financial advisor about whether it makes more sense to choose Medicare Advantage or Medicare. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

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