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Summary of Medicare Costs

Healthcare is expensive. Medicare costs go up every year. Rising Medicare premiums are said to be the fastest growing costs in retirement. Hence it calls for careful consideration and planning from a cost perspective.

This article provides a Part-wise summary of out-of-pocket Medicare costs. Remember that these may go up every year.

Summary of Medicare Costs

This article provides a Part-wise summary of out-of-pocket Medicare costs, including premiums, deductibles and copays/coinsurance. Remember that these may go up every year.

PART A (hospital insurance) Costs

Description

Out-of-pocket Costs for Part A (2019)

Monthly Premium

No monthly premium if you paid social security taxes for at least 40 quarters, up to $437 otherwise

Maximum Out-of-Pocket

No limit

Hospital Stay per Benefit Period

 

  • Deductible

$1,364

  • 1st – 60th day

$0 copay

  • 61st – 90th day

$341 per day copay

  • 91stday onwards

$682 copay for each ‘lifetime reserve’ day

All 60 ‘lifetime reserve’ days used up

All costs paid by you

Click on Medicare – Part A for more information.

 

Part B (medical insurance) Costs

You have to pay a monthly premium for Part B, often deducted directly from your Social Security benefits.

Part B premium is based on income from 2 years back and filing status. For example, Part B premiums for 2019 will be based on your 2017 income.

Description

Out-of-pocket Costs for Part B (2019)

Monthly Premium

$135.50 Standard Premium

Many of those who paid less than Standard last year will continue to pay less

Upto $460.50 (depending on income)

Annual deductible

$185

Doctor and other medical services (including inpatient care)

Typically 20% of approved amount

Outpatient hospital care

Varies. Typically 20% or more of approved amount

Home health care & Clinical diagnostic lab services

$0

 

Most other tests and services

 

20% of approved amount

 

Durable Medical Equipment

20% of approved amount + other costs

 

Annual wellness visit

$0

Click on Medicare – Part B for more information.

 

Part C (Medicare Advantage) Costs

Part C (Medicare Advantage or MA) monthly premium varies by plan and its ‘metal tier’ and usually ranges from $0 to over $200 (the range may vary based on Carrier and Location). This is also impacted by additional benefits offered by a plan and whether prescription drug coverage is included. Plans which include drug coverage are called MA-PD (Medicare Advantage – Prescription Drug Plan).

Apart from the monthly premium, your out-of-pocket expenses for part C may include deductibles and coinsurance or copays for various services. These costs may go down for you if you have Medicaid or other help for healthcare expenses.

Note that MA Plans usually have a cap on out-of-pocket expenses. Medicare Part A and Part B do not have such caps.

Click on Part C - Medicare Advantage for more information.

 

Part D (Prescription Drugs) Costs

Like Part C, Part D monthly premium also varies by plan. Your actual prescription drug plan costs will vary depending on various factors such as carrier, the drugs you use, the plan's formulary, and whether you go to a pharmacy that is in your plan's network. These costs may go down if you get 'Extra Help', which is a program to help with prescription drug costs.

Like Part B, monthly premiums for Part D are also impacted by income and filing status. In 2019, high-income earners could pay up to $77.40 per month additional for Part D coverage.

Click on Part D - Prescription Drugs for more information.

 

Medicare Supplement Costs

Medicare Supplement plans are standardized. Coverage offered does not vary by Carrier, but depends on Plan Type. All plans of a particular type offer the same coverage, though premiums may still vary.

Carriers may charge different premiums for the same Medicare Supplement Plan type and location. Premiums may also get impacted by other factors such as age, health status, whether an enrollee is a smoker or not, and options like high-deductible plans.

Apart from various Plan Types, Medicare Supplement plans are also categorized based on how their premium varies with age.

  • Community-rated policies => individuals in a community pay the same premium, irrespective of age
  • Issue-age-rated policies => the premium is based on the age at which you buy the policy, with younger buyers getting lower premium benefits. The premium does not change due to age as you grow older, and
  • Attained-age-rated policies => the premium is based on your current age and goes up as you get older. Attained-age-rated policies may eventually become the most expensive.

Note that all types of Medicare Supplement Plans may not be available in a particular area.

Click on Medicare Supplement Plans for more information.

                                                                                                                                                  

Click here to learn more about Medicare, its various Parts, different enrollment periods and your costs. 

We have also created videos to help you better understand various topics related to Medicare. Select and watch a video explaining the topic of your interest in a simple and intuitive manner.

Remember that you cannot choose just any combination of Parts and Plans. Let Lighted Road Insurance guide you step-by-step through the Medicare ecosystem and help you in selecting the right plan(s) for your needs. 

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Last Updated: 11-17-2019