Your Yearly Medicare Costs

Together, Medicare Part A and Medicare Part B are known as Original Medicare. It’s important to keep in mind that Medicare Part A and Part B don’t cover everything and leave some out-of-pocket costs to you.1

American flag money stethoscope and medication

2019 Medicare out-of-pocket costs

Medicare Part A and Medicare Part B help cover some hospital and medical costs for people at age 65 and older and people younger than 65 who have certain disabilities or medical conditions.

Medicare Part A is known as hospital insurance and helps cover: 

  • Hospital care
  • Hospice
  • Limited home health services
  • Skilled nursing facility care

Medicare Part B is known as medical insurance and helps cover preventive services and medically necessary services, such as:

  • Clinical research
  • Doctor’s services
  • Ambulance services
  • Limited outpatient prescription drugs
  • Getting a second opinion before surgery

When you enroll in Medicare, you will pay a monthly premium for your Medicare benefits as well as some out-of-pocket costs like deductibles and coinsurance.

  • Most people do not pay a premium for Medicare Part A, as long as they or or their spouse paid sufficient Medicare taxes while working. If you do pay for Part A, your premium could be as high as $437 per month in 2019.
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  • In 2019, the Medicare Part B premium is $135.50 per month. The average cost for your Part B premium could be higher depending on your income, and some people who get Social Security benefits may pay less.

Other Medicare out-of-pocket costs include deductibles, coinsurance and copayments.

Medicare deductibles, coinsurance and copayments

If you’re enrolled in Medicare Part A and Part B, you must pay a deductible for each part.

Part A Deductible

Your Part A deductible is the amount you must pay in hospital costs before Medicare begins paying its share.

In 2019, the Part A deductible is $1,364 per benefit period.

Medicare Part A benefit periods are based on how long you’ve been discharged from the hospital. You benefit period resets when you’ve been out of the hospital for 60 days. If you return to the hospital for another visit after 60 days has past, you would have to pay the Part A deductible again because your benefit period reset. 

  • For your first 60 days that you are in the hospital, you pay nothing additional out of pocket for your hospital costs after meeting your $1,364 deductible.
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  • For days 61-90 in a hospital during a single benefit period, you pay a $341 coinsurance for each day you are hospitalized.
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  • If you are in the hospital for more than 90 days during a single benefit period, you pay a $682 coinsurance for each day you are hospitalized for up to 60 lifetime reserve days.

Part B deductible

Your Part B deductible is the amount you must pay in medical costs before Medicare begins paying its share.

  • In 2019, the Part B deductible is $185 per year.
  •  
  • You typically pay 20 percent of the Medicare-approved amount for most doctor’s services once your deductible is met. This average cost is known as your Part B coinsurance.

Medicare coinsurance and copayments

Coinsurance is the percentage of your healthcare charges that you pay once your deductible is met (example: 20 percent).

Copayments are specific amounts you pay for a healthcare service after your deductible is met (example: $20).

If you’re enrolled in Medicare Part A and Part B, you’ll have separate coinsurance/copayments for each part.

Part A coinsurance for skilled nursing facility care

Medicare Part A covers skilled nursing care provided in a skilled nursing facility under certain circumstances. The 2019 Part A coinsurance amounts are as follows:

  • Days 1-20: $0 coinsurance per benefit period
  • Days 21-100: $170.50 coinsurance per day of each benefit period
  • Days 101 and beyond: You are responsible for all costs

Part B excess charges

Doctors who do not accept Medicare assignment can charge more than the Medicare-approved amount for a service or procedure. The difference between the amount a doctor charges and the Medicare-approved amount is known as an excess charge.

The Part B excess charge can be as much as 15 percent more than the Medicare-approved amount.

Foreign travel emergency costs

Original Medicare does not typically cover healthcare services received outside of the U.S. and its territories. This means that you are generally responsible for 100 percent of your health care costs while traveling abroad.

Listed below are three exceptions to this rule.2

  1. You’re in the United States when you have a medical emergency and a foreign hospital is closer than the nearest U.S. hospital.
  2.  
  3. You live in the United States and a foreign hospital is closer to your home than the nearest U.S. hospital that can treat you for your medical condition.
  4.  
  5. You’re traveling through Canada “without reasonable delay” by the most direct route between Alaska and another state when a medical emergency occurs and the Canadian hospital is closer than the nearest U.S. hospital.

Medicare prescription drug costs

Original Medicare does not generally cover prescription drugs, with the exception of limited outpatient prescription drugs.

This means that you are responsible for paying 100 percent of your drug costs with Original Medicare.

Medicare vision, dental and hearing coverage

Original Medicare does not cover vision, dental or hearing services that are not considered medically necessary. This includes routine and preventive care. If you’re enrolled in Original Medicare, you are responsible for 100 percent of the costs related to these services.

Couple looking out of window

Medicare Advantage plans may cover more

Medicare Advantage (Medicare Part C) is an alternative to Original Medicare that provides the same benefits as Medicare Part A and Part B. One exception is hospice, which is still covered by Medicare Part A. Many Medicare Advantage plans may cover prescription drugs.  

Additionally, some Medicare Advantage plans also offer coverage for vision, dental and hearing care, as well as health and wellness programs such as SilverSneakers to help keep enrollees active and healthy.

Another advantage of Medicare Part C is that plans have an out-of-pocket maximum, which limits how much you could pay out of pocket for care in a given year. Original Medicare does not have an out-of-pocket maximum.

The following chart shows how Medicare Advantage coverage and benefits compare to those of Original Medicare.

Original Medicare vs. Medicare Advantage
 

Original Medicare

Medicare Advantage

Helps cover hospital and medical costs

May cover routine dental care

May cover routine vision care

May cover prescription drugs

Has an out of pocket maximum

Medicare Advantage plan costs

When you enroll in Medicare Advantage, you are still responsible for paying your Medicare Part B premium. The standard Part B premium is $135.50 per month in 2019.

Some Medicare Advantage plans have a monthly premium that you pay in addition to your Part B premium, but it is possible to find Medicare Advantage plans with $0 monthly premiums.*

Medicare Advantage plans also come with their own out-of-pocket costs like deductibles and coinsurance. These costs vary by plan and replace those of Original Medicare.

Medicare prescription drug costs

If your Medicare Advantage plan includes coverage for prescription drugs, you typically pay a coinsurance or copayment for covered drugs. With Original Medicare, you could pay 100 percent of the costs of many prescription drugs.

Specific prescription drug costs will vary depending on the Medicare Advantage plan you enroll in. 

If your Medicare Advantage plan does not include coverage for prescription drugs, you can enroll in a stand-alone Part D (Medicare Prescription Drug Plan) to help cover some of your drug costs.

Some things to know about Medicare Prescription Drug Plans: 3 

  • If you enroll in a Medicare Part D plan, you typically pay a monthly premium for your Part D coverage in addition to your Medicare Part B and Medicare Advantage premiums (if applicable).
  •  
  • Once your Part D deductible is met, you typically pay a copayment or coinsurance for covered drugs and your Part D plan pays the rest. Specific copayment/coinsurance amounts will vary by plan.
  •  
  • Part D plans have an Initial Coverage Limit ($3,820 in 2019), which is the total amount you can spend on prescription drugs before entering your plan’s coverage gap.
  •  
  • Once you enter the coverage gap (also known as the “donut hole”), you may be required to pay a larger portion of your prescription drug costs.
  •  
  • Once you spend $5,100 on prescription drugs in 2019, you will leave the coverage gap and enter catastrophic coverage.
  •  
  • The costs you pay for drugs while in the coverage gap typically contribute to your $5,100 out of pocket total to help get you out of the coverage gap.
  •  
  • With catastrophic coverage, you pay a smaller copayment or coinsurance than you did during the initial coverage phase or while you were in the coverage gap.
  •  
  • Catastrophic coverage remains in effect until the end of the year.

Medicare Advantage plans can offer additional benefits

Some Medicare Advantage plans offer additional benefits such as dental, vision and hearing coverage. Starting in 2019, Medicare Advantage plans can begin to offer additional benefits such as transportation to doctor's appointments, grab bars in home bathrooms and healthy meals delivered to your home.

Typically, you pay a copayment or coinsurance for covered services once your deductible is met and your Medicare Advantage plan pays the rest. Specific coinsurance or copayment amounts vary by plan.

Medicare Advantage eligibility and enrollment

To enroll in a Medicare Advantage plan, you must first enroll in Medicare Part A and Part B and live in the Medicare Advantage plan’s service area. Those with end-stage renal disease usually cannot enroll in a Medicare Advantage plan, though you may be able to enroll in a Medicare Special Needs Plan (SNP).

You can get help enrolling in a Medicare Advantage plan by speaking with a licensed insurance agent at   TTY Users: 711 24 hours a day, 7 days a week.

If you aren’t automatically enrolled, you can manually enroll in Medicare by:

  • Calling Social Security at 1-800-772-1213 (TTY users 1-800-0778), Monday through Friday 7AM-7PM
  • Visiting the Social Security website at www.SocialSecurity.gov
  • Visiting your local Social Security office

If you manually enroll in Original Medicare, you should do so as soon as you’re eligible to avoid having to pay late enrollment penalties.

Most people become eligible for Medicare three months before their 65th birthday. If you are younger than 65 and qualify for Medicare because of a disability, you’ll be eligible to enroll on the 24th month of receiving disability benefits from Social Security or the Railroad Retirement Board.4

Speak with a licensed insurance agent

Once you’re enrolled in Medicare Part A and Part B, you may be able to enroll in a Medicare Advantage plan. Speak with a licensed insurance agent at   TTY Users: 711 24 hours a day, 7 days a week to find Medicare Advantage plans in your area.

 

1 All Medicare cost data from Medicare.gov, Medicare 2019 Costs at a Glance unless otherwise noted. 
2 Medicare.gov, Your Medicare Coverage: Travel
3 Medicare.gov, Costs in the Coverage Gap
4 Medicare.gov, I Have a Disability.

Copyright © 2018 TZ Insurance Solutions LLC. All rights reserved.

MedicareAdvantage.com is a website owned and operated by TZ Insurance Solutions LLC. TZ Insurance Solutions LLC and TruBridge, Inc. represent Medicare Advantage Organizations and Prescription Drug Plans having Medicare contracts; enrollment in any plan depends upon contract renewal.

Plan availability varies by region and state. For a complete list of available plans, please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov.

Medicare has neither reviewed nor endorsed this information.