How Much Does Medicare cost?

Depending on the Medicare plan that you select, costs may include:

  • Premiums
  • Copayments
  • Coinsurance
  • Deductibles

Fortunately, most Medicare Supplements and Medicare Advantage plans keep it affordable with out-of-pocket limits.

What Are My Medicare Options?

Original Medicare

Medicare Part A (hospital insurance) and Part B (medical insurance) are also known as Original Medicare. They provide basic health insurance if you are age 65+ or disabled. Medicare Part D is the Medicare-approved prescription drug plan issued by private insurance companies.

Medicare Supplement

Medicare supplements work alongside and complement Medicare Part A and B. Sometimes, these policies are called Medigap plans. Private insurance companies sell them, and they help cover copayments, coinsurance, and deductibles charged by Medicare.

You can only purchase one supplement plan at a time, but you can change to another supplement policy anytime.

Medicare Advantage

Medicare Advantage is a "bundled" alternative to Original Medicare with a supplement. It is also known as Medicare Part C, but these policies are issued by private insurers, not the government.

They include the same coverage as Part A (hospitalization), Part B (medical insurance), and, often, Part D (prescription drugs). Some Medicare Advantage plans also offer additional coverage that Original Medicare does not.

You can enroll in Medicare Advantage during your Initial Enrollment Period if you wish, or you can wait for the Annual Enrollment Period each fall.

How Much Does Medicare Part A Cost?

Happily, most people do not pay a premium for Medicare Part A (hospitalization) because they qualified by working enough (and paid Medicare taxes).

However, if you did not work enough before enrolling in Medicare Part A, you may pay a premium. Also, if you waited to sign up for Part A after you first became eligible, you may pay a penalty fee in addition to the premium.

Medicare Part A charges copays, deductibles, and coinsurance for various services. For example, you would pay 20% of all durable equipment costs, but $0 for home health care services.

Plus, Medicare grants a free annual mental health screening, but you would pay 20% for outpatient mental health services.

How Much Does Medicare Part B Cost?

On the other hand, Medicare Part B (medical insurance) charges a $144.60 per month premium. Most people pay that amount, but some pay more if they earned a higher (taxable) income recently.

So, you'll pay a monthly for Part B, but if you must use the insurance, you also have copays, deductibles, and coinsurance.

Copayments occur at the time of services. Deductibles are annual amounts you must pay before the full policy benefits start. Coinsurance is cost-sharing, where you pay a portion, and the insurance pays a portion.

Medicare Part B has an annual deductible you must satisfy. Then, as with Medicare Part A, you will pay a 20% coinsurance with Part B for things like outpatient hospital treatment. Fortunately, some services have no additional fees, such as Medicare-approved lab tests, preventative care, and home health services. 

It's crucial to enroll in Medicare Part B when you first become eligible. If not, Medicare charges you a late enrollment fee that lasts for as long as you have Part B! That really adds up to thousands.

So, make sure you enroll during your Initial Enrollment Period or within 12 months of the initial enrollment period ending. Also, you can register during the Annual Enrollment Period from October 15 through December 7, or during the General Enrollment Period January 1 through March 31.

How Much Does Medicare Part C Cost?

Medicare Part C is also known as Medicare Advantage. It works differently from Medicare Part A and B. Basically, you pay the government your $144.60 per month, and, in turn, they pay it to the Medicare Advantage insurance company. Then, the insurance company is now responsible for providing your Part A and Part B coverage and processing claims.

The Medicare Advantage option came out in 2003 and has been wildly popular for several reasons:

  • It's a simpler way to manage Medicare
  • You get one ID card instead of several
  • Provide an out-of-pocket maximum, so you don't pay the 20% coinsurance forever
  • Some Advantage plans also include Medicare part D, so you don't have to buy a separate policy for medications
  • Some Advantage policies have a $0 premium
  • Medicare Advantage is allowed to offer additional benefits like dental, vision, hearing, and fitness services

However, there are some drawbacks:

  • Most Advantage plans only cover if you stay in-network
  • You can only change plans once a year, during the Medicare Advantage Open Enrollment Period
  • Occasionally, insurers phase out a plan and replace it with a new one
  • Not all plans include Medicare Part D medications
  • Coverage and costs vary between states
  • If you move, you may have to get a new plan (not the case with Medicare supplements)

How Much Does Medicare Part D Cost?

In addition to your Medicare Part B premium, you would also pay monthly for Medicare Part D. Although Part D is considered to be part of Original Medicare, standalone Part D policies are issued by insurance companies. The federal government provides guidelines but does not manage prescription drug plans at all.

The premium depends on your income, marital status, and whether you file individual or joint tax returns. Prescription drug plans also have a deductible set by Medicare. You would also pay copayments and coinsurance.

Like Medicare Part A and Part B, you will pay a late enrollment penalty if you did not sign up for Part D during your Initial Enrollment Period. If you previously had health insurance through your employer that ended, you must enroll in part D within 63 days of your coverage ending.

Also, you can enroll in Medicare Part D during the Annual Enrollment Period from October 15 to December 7.

How Much Do Medicare Supplement Insurance Plans Cost?

Private insurance companies sell Medicare supplement policies to cover gaps in Medicare Parts A and B. Medicare requires that you be enrolled in Medicare Part A and Part B when you enroll in a Medicare supplement. If you need prescription drug coverage, you will also enroll in a Medicare Part D plan.

Usually, supplements also provide extra coverage and introduce a cap on how much you will pay out-of-pocket. A maximum expense is crucial to avoid financial hardship.

Medicare supplements charge a monthly premium. The amount you pay can depend on your age, health status, sex, and location.

Plus, Medicare requires that each plan, like Medicare supplement plan F or plan J, always provides the same benefits, regardless of which insurance company issues the policy. However, insurers are allowed to charge different prices for the same plans.

Consequently, AARDY always recommends shopping around to find the best plan for the lowest price.

Where Can I Get the Lowest Price on Medicare Insurance?

AARDY is the nation's fastest Medicare insurance marketplace. We can help you find the best Medicare plan that includes Mental Health insurance. Our service compares Medicare supplements and Medicare Advantage plans so you can find the best fit.


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