What is the Cost of Medicare Part B and A?
Original Medicare covers many services, but it is not free. There is a cost associated with each part B and Part A, and you can learn more about each of them below.
What costs should I know for Part A?
Medicare Part A Premium
Most people do not have to pay a premium for Part A because they (or their spouse) paid for it while they worked. If you do have to pay Part A premiums, the longer you or your spouse worked and paid into Social Security, the lower your premiums will be.
Medicare Part A Deductible
Part A doesn’t have an annual deductible but rather applies a deductible to each hospital benefit period. A benefit period begins when you go into a hospital or skilled nursing facility (SNF) and ends when you have been out of the hospital or SNF for 60 consecutive days.
Copays for Part A apply once you stay in a hospital for more than 60 days in a single benefit period. In a skilled nursing facility, copays begin after the first 20 days.
If you have a limited income and resources, you may qualify for help with your Parts A & B costs.
For a hospital stay, you will pay a deductible of $1,340. This is not an annual deductible. You pay this deductible once each benefit period. Your payment changes as you stay in the hospital.
Skilled nursing facility stays
For a skilled nursing facility stay, there is no deductible. Medicare will only cover up to 100 days in a skilled nursing facility though, and only if you meet some very specific criteria:
- 3-Day Hospital Stay: You must have been at a hospital
- For 3 days AND
- Had come to a skilled nursing facility within 30 days of the hospitalization AND
- Had been admitted to the hospital as an inpatient. Time in the emergency room or in what the hospital calls “observation status” does not count, even if you stayed overnight or longer.
- Level of Care: You must also need skilled nursing care 7 days a week, or skilled therapy services 5 days a week.
- Part A: Skilled nursing care is covered under Medicare Part A. You must have had Part A while you were in the hospital.
Also, keep in mind that Medicare will NOT cover your stay if you only need help with personal care (also called custodial care), such as bathing, eating or dressing yourself. Here is what you will pay for a stay in a skilled nursing facility.
There is no deductible or copayment for home healthcare. However, you do need to meet a set of very specific criteria in order for Medicare to cover your home healthcare.
Medicare covers home healthcare services when a doctor certifies that:
- You need medical care at home AND
- You are homebound AND
- You need skilled care from a nurse or a skilled physical, speech or occupational therapist.
Medicare will only cover home care services when your doctor:
- Orders the care from a home health agency that Medicare approves, AND
- Documents a face-to-face visit with you up to 3 months before or 1 month after the start of the service, AND
- Signs a plan for your care.
There is no deductible or copayment for hospice care. You only pay a small share of the costs of medications and inpatient respite care under the Medicare hospice benefit.
What costs should I know for Part B?
Medicare Part B Premium
There is a monthly premium for Part B coverage. For Medicare beneficiaries with incomes below $85K/single or $170K/couple, the Part B premium cost for 2018 will average $134 per month. For Medicare beneficiaries with higher incomes, the Part B premium cost will range from $187.50 to $428.60 per month, based on income level. Medicare beneficiaries who meet certain income and resource guidelines can get their Part B premium paid for by their state’s Medicare Savings Program.
Medicare Part B Deductible
You will also pay an annual deductible of $183 in 2018. That means when you receive services covered by Part B, you will pay $183 before Medicare starts helping you pay. People with Medicare with incomes less than 100% of federal poverty level – about $1,005/month – and few resources can be excused from paying the Medicare deductible and coinsurance.
Once you have paid your deductible, you will then pay 20% of the cost approved by Medicare for most Medicare Part B services.
To keep your Part B costs down, make sure that your healthcare providers take Medicare and “accept assignment.” Doctors or other providers who accept assignment agree to accept the amount that Medicare will pay for a visit or service (called the Medicare-approved amount) as payment in full. So you would only pay the 20% coinsurance.
Providers who see people with Medicare but do not accept assignment can charge you more. They can charge you up to 15% more than the Medicare-approved amount, which means that you would pay your usual 20% coinsurance plus up to an extra 15%.
For example, if the Medicare-approved amount for a doctor visit was $100, but your doctor did not accept assignment, he could charge you up to $115 for your visit. You would pay $35 (20% of the $100 Medicare-approved amount, plus the extra $15 not covered by Medicare).
Providers can also “opt out” of the Medicare program. That means that they can charge you whatever they like for a service and will not bill Medicare. If you see a provider that has opted out of Medicare, you will have to pay the full cost of the service you receive; Medicare will not pay any part of the cost. Providers that opt out of Medicare should have you sign a contract saying that you understand that you will have to pay the full cost of the service.