Medicare May Not Be Enough

Even with Medicare, you'll end up paying nearly half of your health-care expenses, so if you don't have retiree coverage from your employer, you may want supplemental insurance. Make sure you have what you need.

? Sign up for Part B (outpatient care) and Part D (prescription drugs) when you first become eligible for Medicare unless you qualify to defer them because you are still working. If you don't, you'll pay higher premiums if you sign up for them later. And, if you get sick and suddenly need expensive drugs, you may have to wait as much as almost a year to be able to enroll in drug coverage.

? Investigate supplementary insurance. Medigap policies come in 12 government-specified packages of benefits, labeled A-L, to allow easier comparison-shopping by price. For example, all the plans labeled C must offer identical coverage, so you can buy on the basis of price and customer service.

? There are also managed-care options known as Medicare Advantage, most of which are health maintenance organizations.

? Don't shop for Medigap policies based just on the premiums you pay the first year. There are two types of plans. One, called attained age rating, offers low premiums at the outset but increases them -- sometimes sharply -- as you age. The other starts with a higher premium but doesn't increase the premium with age. All premiums go up based on inflation and the plan's medical experience.