Costs are split up three ways
Part A of Medicare covers hospital services, Part B covers doctor visits and outpatient services and Part D (we didn’t skip C: Medicare actually categorizes these as parts A, B and D) covers prescription drugs. However, if you or your spouse paid Medicare taxes for ten years or more, Part A will be free of charge. Otherwise, you’ll face a monthly premium of several hundreds of dollars. Part B typically runs you about $104 per month, and part D runs about $30 per month.
You may want supplemental insurance
Medicare does not cover deductibles, co-payments or other discrepancies. So, you may want to consider what’s called a “Medigap” plan to fill in the gap where Medicare falls short. Many insurance companies have a plan for this purpose.
There are comprehensive plans
You can sign up for Medicare Advantage, which covers everything traditional Medicare and a supplemental insurance would cover. This typically comes with a monthly premium, on top of the included premium you’ll be paying for Part B. But with Medicare Advantage, you can skip signing up for part D. You’ll still be subject to co-payments and deductibles, but they’ll be significantly lower than in a traditional Medicare plan.
If you earn more, you pay more
If you earn more than $85,000 and are single, or more than $170,000 while married and filing jointly, you’ll pay a surcharge on the premiums for parts B and D. High earners may pay anywhere from $146 to $335 for part B depending on their earning bracket, and an additional $11 to $66 for part D.
65 is the sign up age
If you are already accepting Social Security benefits, you’ll be automatically signed up for Parts A and B. You can opt out of Part B, but if you choose to hold onto it, the cost will be taken out of Social Security should you have already claimed benefits. Those who have not been receiving Social Security benefits must sign up for Parts A and B, and the 7-month enrollment time begins three months before the month of your 65th birthday.
There are several enrollment periods
If you miss the initial 7-month window to sign up for Part B, you can still sign up during general enrollment, which goes from January 1 to March 31. Coverage begins on July 1. Keep in mind that a 10 percent penalty for life will be charged for every year-long period you put off enrollment for Part B. However, those who are not retired can sign up later without paying a penalty during a period that runs 8 months after they’ve stopped working. Should the latter party miss special enrollment, they can wait until open enrollment, which goes from October 14 to December 7. During this time you can also change Part D plans or Medicare Advantage for the following year.
Part D is going down in cost
The period during which you need to pay out of pocket for prescription medicine is shrinking. In 2013, the coverage gap kicks in when your prescription costs hit $2,970. “Catastrophic Coverage” kicks in when your prescription costs hit $4,750. But by 2020, beneficiaries will only pay 25% of the costs of prescription drugs while in the coverage gap.
Cost-free preventative services are increasing
Recently Medicare increased the number of preventative services available to beneficiaries. Individuals receive an annual “wellness exam” (check up), free cardiovascular screenings every 5 years, yearly mammograms, flu shots, and screenings for cervical, prostate and colorectal cancers.
Here’s what Medicare won’t cover
Medicare attends to immediate services, and preventative ones, but it does not pay for long-term care. Medicare will pay for temporary in-home nurses after procedures, but it will not pay for “custodial care”—in other words, a nurse who helps you with daily living activities. Medicare also does not cover routine dental or eye care, as well as extras like dentures or hearing aids.
You can appeal a Medicare decision
If you disapprove of a decision made by Medicare regarding your coverage, you have the right to appeal it. There are 5 levels of appeals, and if yours is denied at one level, you can typically move up to the next level. If you feel your health is at risk if a decision is not taken soon, you can ask for a fast action decision to be made with in 72 hours.
