Paying for Medicare

Medicare provides coverage for a variety of health care services. But it includes a number of different out-of-pocket expenses from beneficiaries, including premiums, deductibles, copayments and more. We’ll help you understand how to pay your Medicare expenses and provide you with some cost-saving tips.

American flag, money, stethoscope and medicine

Paying for Part A and Part B premiums

The premium is the monthly amount you pay for your Medicare benefits. Medicare Part A is premium-free for most people (if they paid Medicare taxes for 10 years while working), while Part B comes with a premium that may increase based on your income. Part C and Part D costs vary by the plan and private insurance company that sells them.

Paying for Part C and Part D premiums

Part C (known as Medicare Advantage) and Part D (prescription drug coverage) are sold by private insurance companies and there are hundreds of plans available.

Each Part C and Part D plan will come with its own costs, coverages, terms and ways in which they can be paid for. To determine how you can pay for a Part C or Part D plan, you’ll need to talk with a licensed insurance agent.

Deductibles, copayments and coinsurance 

Of course, the monthly premium won’t be your only Medicare expense. You may need to pay out of pocket toward deductibles. Also, you’ll likely incur some copayment or coinsurance expenses along the way.

The same applies to Medicare Advantage. Where out-of-pocket costs for Original Medicare are standardized, Medicare Advantage costs can vary by plan. You may be able to find a Medicare Advantage plans with lower out-of-pocket costs, depending on what plans are available in your area.

The average American enrolled in Original Medicare (Part A and Part B) in 2017 could expect to spend more than $7,000 annually in out-of-pocket expenses.** That cost can vary depending on a number of factors.

Ways to save

If you think you may have trouble paying for Medicare expenses, there are a few options available.

A Medicare Savings Program is designed to help people with lower incomes save money on Medicare expenses. There are four types of Medicare Savings Programs that can help pay for Part A and Part B premiums, deductibles, copayments and coinsurance.

There is also the Extra Help program (also known as the Low Income Subsidy, or LIS). This program helps patients pay for their Medicare Part D prescription drug plan and assists with premiums, deductibles, coinsurance and copayments. Those enrolled in the Extra Help program are also exempt from coverage gap, or “donut hole” found in Part D plans.

In addition to the available discount programs, there are a number of things you can do to save money on your Medicare expenses.

  1. Sign up when you first become eligible
    There are several enrollment periods for Medicare. If you don’t enroll when you are first eligible, you may end up paying more for coverage.

  2. HMO or PPO?
    Medicare Part C plans come in the form of both PPO and HMO plans (among other options). This means that going out of your plan’s network for care can cost you extra. Familiarize yourself with your plan’s network and map out where you can go for each type of service.

Get in touch with a licensed insurance agent today to discuss your options and find a Medicare Advantage plan in your area. Call TTY Users: 711.

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

**The Motley Fool, “Here’s the Average American’s Annual Medicare Bill.” Published February 5, 2017. https://www.fool.com/retirement/2017/02/05/heres-the-average-americans-annual-medicare-bill.aspx

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.