Cost can be an important consideration when shopping for any type of health insurance.
Here’s what you should know about Medicare Part C (Medicare Advantage) costs in 2019 and 2020, which can help you as you shop for Medicare Advantage plans in your area.
Medicare Part C plan costs for 2020 will be announced when new plans are offered for sale during the Medicare Annual Enrollment Period (AEP). But it’s never too early to start planning for your potential 2020 Medicare costs, such as premiums, deductibles and copayments.
Some Medicare Advantage plans may feature $0 premiums
Your Medicare Part C plan premium is the cost you must pay – typically monthly – to belong to the plan.
In 2019, the weighted average premium paid for a Medicare Part C plan was $29 per month. This varied from plans with premiums as low as $1 per month in South Carolina to as high as $121 per month in Minnesota.1
It’s important to note that many areas of the U.S. may feature $0 premium plans. In fact, close to half of all Medicare Advantage plan beneficiaries (59 percent) in 2019 pay no premium for their plan.1
In one example, 88 percent of Medicare Advantage plans in the state of Florida featured a $0 premium in 2019.1
In states like Florida, Alabama and South Carolina, as many as nine out of every 10 Part C members belonged to a $0 premium plan.1
What affects Medicare Part C premiums?
Some variables that can affect the cost of a Medicare Part C premium include:
- Plan type
There are several different types of Part C plans, each of which can vary in cost.
For example, HMO (Health Maintenance Organization) plans tend to have lower premiums than PPO (Preferred Provider Organization) plans. - Location
Local market competition and cost-of-living can have an effect on the cost of a plan.
For example, the weighted average Medicare Advantage plan premium in South Carolina in 2019 was only $1 per month, while the same weighted average premium in New York in 2019 was $42 per month.1 - Coverage
Some Medicare Part C plans can include a variety of extra benefits that aren’t covered by Original Medicare (Medicare Part A and Part B).
Most Medicare Advantage plans cover prescription drugs, and some plans may offer coverage for dental and vision care, hearing care, fitness club memberships, non-emergency transportation and more.
Plans that offer more extra benefits may cost a little more than plans that offer less coverage. - Cost-sharing
Some Part C plans may charge a higher premium but feature a lower deductible or coinsurance, while other plans may pair a lower premium with higher cost-sharing requirements. - Insurance companies
Each insurance company is free to set their own price for a Medicare Advantage plan. You may find two similar plans sold by two different companies in the same zip code, at very different prices.
A licensed insurance agent can help you compare plans that are available where you live in order to find the premium costs that fit your budget.
How Part C premiums compare to Original Medicare premiums
While most people do not pay a premium for Medicare Part A, beneficiaries typically pay the standard Part B premium, which is $135.50 per month in 2019.
People who report higher incomes may more for their Part B premiums, due to what is called the Medicare Income-Related Monthly Adjustment Amount (IRMAA).
Do Medicare Part C plans have deductibles?
A deductible is the amount you must pay out of your own pocket toward the costs of covered services and items before your plan coverage kicks in.
Some Medicare Advantage plans may include $0 deductibles.
In 2019, the weighted average Medicare Part C deductible (including plans with $0 deductibles) was $95 per year. South Carolina, Pennsylvania, Nevada and Kentucky all had a weighted average deductible of $15 or less in 2019.
On the other side of the spectrum, Montana’s average weighted premium was more than $400.
How Part C deductibles compare to Original Medicare deductibles
Medicare Part B requires an annual deductible of $185 for the year in 2019.
The 2019 Medicare Part A deductible is $1,364 per benefit period.
Do Medicare Advantage plans have coinsurance or copays?
Cost-sharing measures are the share of medical bills that you must pay after your deductible has been met.
Cost-sharing can typically come in two forms:
- Copayments
This is a flat-fee. A $20 copayment on a bill of $300 means you would pay $20 and your plan would cover the remaining $280. - Coinsurance
Coinsurance is a percentage of your medical bill. A 20 percent coinsurance requirement on a $300 bill means you’ll pay $60 (20 percent of $300), while your plan takes care of the remaining $240.
Cost-sharing such as coinsurance and copays with Medicare Part C plans may vary by plan.
How Part C cost-sharing compares to Original Medicare copays/coinsurance
Part B of Medicare typically requires a 20 percent coinsurance payment for covered services and items (after you meet your Part B deductible).
Part A coinsurance can reach as high as $682 per day in 2019 for extended inpatient hospital stays.
Medicare Advantage plans include out-of-pocket spending limits
A Medicare Advantage plan out-of-pocket spending limit represents an annual cap on your out-of-pocket spending for covered Part A and Part B health care costs.
Once you have reached this amount, your Part C plan will pay for 100 percent of the cost of all covered services and items for the remainder of the year.
In 2019, Medicare Part C plans carried an average out-of-pocket limit for in-network care of just under $4,800 per year. By law, all Part C plans must contain an out-of-pocket limit of no more than $6,700 in 2019.
The out-of-pocket limit can help protect you from Medicare out-of-pocket costs that can add up quickly as a result from a serious injury or illness that requires lengthy inpatient hospital stays.
Original Medicare does not feature an out-of-pocket limit, which can be one factor many beneficiaries may consider in joining a Medicare Advantage plan.
Compare Medicare Part C costs where you live
If you have questions about Medicare Part C costs or would like to compare Part C plans available in your area, call to speak with a licensed insurance agent today.
Find Medicare Advantage plans in your area
Compare plans nowOr call 1-800-557-6059 (TTY: 711) 24/7 to speak with a licensed insurance agent.
