A new study conducted by MassMutual showed that 65% of those answering Medicare basic questions between the ages of 60-64 failed to answer most of them correctly. Specifically, 42% of older workers though that both Medicare Parts A and B are free. Additionally, 37% thought that filing for Medicare and Social Security together was required, and 34% didn’t know that Medicare won’t pay for health coverage outside of the United States.

If you’re between the ages of 60-64, it’s imperative to understand the program’s ins and outs. Otherwise, you risk losing key benefits or facing higher-than-necessary healthcare costs you can’t afford!

Medicare Pathways is here to help guide you through the process to understand the basics of Medicare.

Though Medicare seems complex, there are certain rules you should know before applying. First, the program consists of several distinct parts. Part A covers your hospital visits and is generally free for enrollees. Part B covers your doctor visits and diagnostics and comes at a premium that presently starts at $134 per month, but has the potential to increase based on your income. Part C is a plan that is sold by private insurance companies and also known as Medicare Advantage. Part C plans must have the same coverage as Part A & Part B, and in most cases, includes prescription drug coverage and other added benefits. There’s also Part D, which covers prescription drugs, and like Part B, charges a premium.

Of course, your total out-of-pocket spending under Original Medicare Part A & Part B will depend on the extent to which you need to use its various services. However, know that either way, you’ll be looking at a monthly premium factor into your retirement budget.

Many beneficiaries enroll in Medicare Supplement Insurance Plans to help cover the gaps left behind by Original Medicare Part A & Part B. These are also known as Medigap policies and have standardized benefits. This means that a Medicare Supplement Plan F offers the same benefit, even if offered by a different insurance carrier. Prices may vary, but coverage offered in a Medicare Supplement Insurance Plan will not.

Another thing you must know about Medicare is that even though it and Social Security are interrelated, each program has its own rules. While Medicare eligibility usually begins at age 65 (except younger individuals with disabilities and individuals with End-Stage Renal Disease), you’re allowed to claim Social Security as early as age 62. Doing so will result in a reduction of benefits because you’re not eligible for those benefits in full until you reach full retirement age. That age is dependent on your year of birth, and it’s either 66, 67, at 66 and a certain number of months.

Either way, if you rush to claim Social Security benefits the moment you become eligible for Medicare coverage, you could cut your benefits in the process, reducing a great source of income in retirement. Just don’t make a mistake thinking you have to file for Social Security to sign up for Medicare.

The more you know about your Medicare health plan options, the better equipped you’ll be to use and plan for it wisely. If you’re nearing retirement, it pays to read up and ask questions about how Medicare works.