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Aarp Reveals Key Plan For Social Security, Medicare

Many Americans worry about the long-term financial health of Social Security, the federal program that millions count on for monthly paychecks in retirement.

Concerns about the Social Security trust funds' solvency in the next decade are explained specifically by the Social Security Administration (SSA), which reported that they will run out of money in 2033. Continuing the program, without congressional action, may involve a decrease of 23% of a recipient's expected monthly paychecks.

For those nearing retirement, the uncertainty complicates decisions about savings, investments, and when to claim benefits.

Younger people, meanwhile, often question whether Social Security will be available to them at all, prompting a greater emphasis on private retirement planning and employer-sponsored accounts such as 401(k)s and IRAs.

At the same time, Medicare — another cornerstone of retirement security — is undergoing notable changes in 2026, according to the Centers for Medicare and Medicaid Services (CMS).

One recent positive development is the introduction of negotiated drug prices, which is expected to lower out-of-pocket costs for beneficiaries. This shift offers relief to retirees who often face high prescription expenses, making healthcare more affordable and predictable.

As individuals consider what lies ahead for the programs themselves, many are thinking practically about when and how to enroll in Social Security and Medicare.

While each program serves distinct purposes, the AARP identifies what is next for people preparing for retirement and ways the two federal programs intersect and complement one another.

AARP explains what is next for Social Security, Medicare recipients

The AARP acknowledges for newcomers that the relationship between Social Security and Medicare can be confusing because the two programs operate differently. They both serve older and disabled Americans and they intersect in some important ways.

For one, the AARP explains that Social Security is involved no matter when or how one enrolls in Medicare.

"If you’re already receiving Social Security retirement benefits at least four months before you turn 65, the SSA will send you a Welcome to Medicare package that includes your Medicare card at the start of your initial enrollment period, which begins three months before the month you turn 65," the AARP wrote. "For example, if your 65th birthday is July 15, 2026, this period begins on April 1."

"On your 65th birthday, you’ll automatically be enrolled in parts A and B," the AARP continued. "You have the right to opt out of Part B, but you might face a penalty in the form of permanently higher premiums if you sign up for it later."

How the Medicare Parts are organized

Medicare is divided into various parts, as clarified by medicare.gov.

Medicare Part A (hospital insurance)

Covers inpatient care in hospitals
Includes skilled nursing facility care
Provides hospice care
Helps with certain home health care services

Medicare Part B (medical insurance)

Covers services from doctors and other health care providers
Includes outpatient care
Provides home health care
Covers durable medical equipment (wheelchairs, walkers, hospital beds, etc.)
Includes many preventive services (screenings, vaccines, yearly “Wellness” visits)

Medicare Part C (Medicare Advantage)

Medicare-approved plans offered by private companies
Bundles Part A, Part B, and usually Part D together
Often requires using doctors and hospitals within the plan’s network
May have different out-of-pocket costs compared to Original Medicare
Can include extra benefits not offered by Original Medicare
May require an additional premium

Medicare Part D (drug coverage)

Helps cover the cost of prescription drugs
Includes many recommended vaccines and shots
Available as a separate plan with Original Medicare
Often included in Medicare Advantage plans
Run by private insurance companies that follow Medicare rules

Medicare Supplemental Insurance (Medigap)

Extra insurance you can buy from private companies
Helps pay your share of costs in Original Medicare (like coinsurance)
Policies are standardized and named by letters (e.g., Plan G, Plan K)
Benefits are the same across companies for each plan letter

AARP clarifies Medicare and Social Security Disability Insurance

Individuals under the age of 65 who cannot continue working because of a significant illness or injury may become eligible for Medicare if they are receiving Social Security Disability Insurance (SSDI).

SSDI, much like Social Security retirement benefits, is something people earn through employment and by paying Social Security taxes. To qualify, they must show that their medical condition substantially limits their ability to work and is expected to persist for at least a year or is likely to be fatal.

"SSDI recipients automatically qualify for Medicare 24 months after becoming entitled to disability benefits," the AARP explained. "The waiting period is waived for people with amyotrophic lateral sclerosis (ALS) or end-stage renal disease."

"Medicare works for people with disabilities much as it does for eligible older adults," the AARP added. "You likely won’t have to pay for Medicare Part A if you paid Medicare taxes while you were working."

"However, you will have monthly premiums for Part B, and for a Part D prescription drug plan if you enroll in one. These costs might be deducted from your SSDI benefit."

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