Original Medicare provides health insurance for people 65 and older. Certain people with disabilities that are under the age of 65 are also eligible with particular rules. These are some of the costs you can expect to encounter with your Medicare coverage:
Most beneficiaries pay the standard Medicare Part B premium of $134 per month in 2018. Beneficiaries don’t pay a premium for Medicare Part A hospital insurance. The premium cost for Medicare Part D prescription drug coverage depends on the plan you select.
Deductible and coinsurance
Medicare Part B has a $183 deductible in 2018. After that, Medicare beneficiaries typically need to pay 20 percent of the cost of most doctor’s services. There is no annual limit on how much you might need to pay out of pocket.
There are some services Medicare beneficiaries may be eligible for that aren’t subject to these cost-sharing requirements. However, if a problem is discovered during a preventive visit, it could lead to other medical services that do have an additional cost.
If you are hospitalized, Medicare Part A has a $1,340 deductible. If you end up spending more than 60 days in the hospital, it will cost you $335 per day for days 61 through 90 and $670 for up to 60 lifetime reserve days after that. Once you have used your lifetime reserve days, you will become responsible for your own hospital expenses.
Some Medicare beneficiaries buy supplemental insurance policies to cover the cost-sharing requirements of Medicare. A Medigap policy can help to make your health care costs in retirement a bit more predictable. Many plans will cover some of the Medicare Part B out-of-pocket costs and longer hospital stays than Original Medicare.
That’s not your only option, though. Another is to sign up for a Medicare Advantage plan, which means you will receive your Medicare Part A and B benefits through a private insurance plan instead of Original Medicare. Medicare Advantage plans have different cost-sharing requirements for medical services and sometimes more coverage restrictions than Original Medicare.
Prescription drug coverage
Most beneficiaries can choose between multiple plans for their stand-alone Medicare Part D prescription drug coverage, and each offers different prices and coverage. Premiums are higher for people who go 63 or more days without prescription drug coverage after becoming eligible for Medicare and for high-income Medicare beneficiaries. To get the best value for your money, you’ll need to compare plans each year because the prices and covered medications change annually.
Some medical services aren’t covered.
You will need to budget for commonly needed medical services that original Medicare doesn’t cover, including things such as eyeglasses, contact lenses, dental care, and hearing aids. Medicare will only cover up to 100 days of nursing home care. After, you will become responsible for any further long-term care costs.