Medicare 101

How much does Medicare cost?

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Many of the folks new to Medicare are surprised when it comes to Medicare costs. What many had assumed to be free is in fact a considerable expense for the roughly 50% of those on Medicare that make less than $24,000 a year.

Medicare Advantage (HMO) Plans

  • Medicare Part A is free and Part B is $134 a month.
  • Medicare Advantage (HMO) plans range from $0 to about $100.
  • Some plans include extra perks like dental, vision, hearing, gym, transportation.
  • Total costs start at $134 a month (including the Medicare Part B premium) and go up to about $234.

Medicare Supplement (Non-HMO) Plans 

  • Medicare Supplement (Non-HMO) plans start at about $30 for a High Deductible plan to about $150 for the Cadillac Plan F.
  • Prescription Drug Plans start at $20.
  • Plans from the larger carriers include gym membership. Anthem gives you vision and hearing as part of their Innovative F plan.
  • Total costs start at $184 a month (including the drug plan and Medicare Part B premium) and go up to about $300 a month.

The details

Here’s the detailed breakdown of your expected costs under Medicare:

Part A

  • Annual Deductible: $1,340
  • Out of pocket costs: $335 for days 61-90, $670 for days 91-150, then all costs.
  • Monthly Premium:4 $0 for most people.

Part B

  • Annual Deductible: $183
  • Out of pocket costs: 20% of Medicare approved amount for most doctor services, outpatient therapy and durable medical equipment.
  • Monthly Premium: $134 for most, higher if you made more than $85,000 two years ago.

Medicare Advantage

  • Annual Deductible: $0 for many plans, but varies.
  • Out of pocket costs: Co-pays and co-insurance % vary by plan. There’s also an important Annual Maximum Out of Pocket (MOOP) limit that can vary by thousands of dollars, and can be up to $6,700. It’s important to compare these to be covered for extreme cases, where something unexpected happens in December and you reach your MOOP, and then reach it again in January.
  • Monthly Premiums: Start from $0 but vary from county to county.

Medicare Supplement

  • Annual Deductible: Some plans like F cover the Annual Medicare Part B Deductible, while others like G do not. Where it doesn’t, you would be responsible for the $183 per year. High Deductible Plan F’s have a high annual deductible of $2,240.
  • Out of pocket costs: Most plans cover your co-pays and co-insurance for all of your doctors and procedures. Plan N requires you to pay $20 per doctor visit and $50 for Emergency Room visits. High Deductible Plan F’s require you to pay the 20% of Medicare-agreed amounts until you reach your annual deductible amount.
  • Monthly Premiums: Start from about $20-30 for High Deductible F up to about $400 depending upon your age, county, and type of plan.

Prescription Drug Plan

  • Annual Deductible: $0-$405. Many of the less expensive plans have a $405 annual deductible.
  • Out of pocket costs: Plans will require a co-pay for each re-fill that varies depending upon the plan, drug, drug tier, and pharmacy. If you have many expensive prescription drugs, you may hit the coverage gap or catastrophic coverage levels, which would then change what you pay for each of your prescriptions.
  • Monthly Premiums: Start from about $20 and go upwards to about $150.

All plans are required to cover drugs in all of the major categories, and where a medically required drug is not on a plan’s list of drugs, you can always request an exception.

Our take: Unfortunately, there are indeed many costs to consider when signing up for Medicare. For most people turning 65, the range is usually between $134 for an HMO plan to $300 for a Medicare supplement plan all-in. This depends upon your county and prescription drugs. Therefore we suggest reviewing your recommendation that we think can really help with your decision.

Have any questions?
Just get in touch with one of our Heroes Monday through Friday, 9:00AM to 6:00 PM at 833-636-4376 TTY 711 or and we would be happy to help you!

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