Parts A and B of Original Medicare have deductibles you must meet before Medicare will pay for healthcare.
The Medicare Part A deductible applies per benefit period, not per year. You may have one or more benefit period each year.
The Medicare Part B deductible applies annually.
Many Medicare Advantage (Part C) plans have a $0 deductible. Part D prescription drug plans can not exceed an annual deductible of $480 in 2022.
A deductible refers to the amount of money you must pay out of pocket for covered healthcare services before your health insurance plan starts to pay. A deductible can be based upon a calendar year, upon a plan year or — as is unique to Medicare Part A — upon a benefit period.
For 2022, the benefit period deductible for Medicare Part A (see details below) is $1,556. For Medicare Part B, the annual deductible is $233. Part C (Medicare Advantage) and Part D (drug coverage) deductibles vary by plan.
Like other types of health insurance, Medicare has deductibles. Every year, the costs associated with Medicare are adjusted, according to the Social Security Act. These costs also include:
Deductibles and the other costs associated with Medicare usually go up by a small percentage each year.
Medicare consists of multiple parts. If you have Medicare coverage, you may be responsible for one or more deductibles for each part you have.
The parts of Medicare are:
- Part A and Part B — These are the two parts that comprise Original Medicare Original Medicare is a fee-for-service health insurance program available to Americans aged 65 and older and some individuals with disabilities. Original Medicare is provided by the federal government and is made up of two parts: Part A (hospital insurance) and Part B (medical insurance)..
- Medicare Advantage (Part C) Medicare Advantage (Medicare Part C) is health insurance for Americans aged 65 and older that blends Medicare benefits with private health insurance. This typically includes a bundle of Original Medicare (Parts A and B) and Medicare Prescription Drug Plan (Part D). — Medicare Advantage plans are Medicare plans that are sold through independent insurers.
- Part D (prescription drug coverage) — Like Part C, Part D plans are also sold by independent insurers. Many Part C plans include Part D coverage, but others do not. Original Medicare doesn’t cover medications, so a Part D plan is essential for those with Original Medicare.
Deductibles for Part A and Part B are established by Medicare and may change annually.
Part C and Part D deductibles are established by a variety of private insurers. Each insurer determines what the deductible rate will be for the plans they offer. These can vary considerably. Deductibles may range anywhere from $0 to several hundred dollars annually.
To eliminate the possibility that cost will stop you from getting preventive healthcare which can stave off illness and disease, some plans pay the full portion for some services even before your deductible has been met. These services include:
- Preventive care, including some vaccines.
- Annual checkups, including blood and urine tests.
- Disease management programs for conditions such as diabetes, heart disease and kidney disease.
Keep in mind that your deductible is separate from other costs you may incur with Medicare. These include monthly premiums, copays and coinsurance.
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Original Medicare is composed of Medicare Part A and Medicare Part B. Both parts of Original Medicare have deductibles you will have to pay out of pocket before your plan starts to pay for your healthcare.
Medicare Part A covers inpatient services you receive in a facility, including:
- Hospital stays
- Surgical procedures
- Laboratory tests received during a hospital stay, such as:
- CAT scans
- Blood draws
- Urine tests
- Skilled nursing facility care
- Home health care
- Nursing home care
Medicare Part B covers outpatient services that are medically necessary and preventive. These include:
- Doctor appointments, including your primary care physician and specialists
- Ambulance services
- Emergency room visits and services
- Durable medical equipment, such as:
- Hospital beds used at home
- Blood sugar meters and test strips
- Home infusion services
- Physical and occupational therapy
- Mental health services received as an inpatient or outpatient
- Clinical trials
- Most vaccines, including flu shots
- Certain home health services
- Limited outpatient prescription drugs. These include medications used in nebulizers, infusion pumps, and some injectables
Medicare Deductible: Part A
The Medicare Part A deductible 2022 is $1,556 per benefit period. This amount represents an increase of $72 over the 2021 Part A deductible, which was $1,484.
A benefit period begins on the day you’re admitted into a hospital or skilled nursing facility and ends when you have been out of the facility for 60 consecutive days. If you’re readmitted to the same or a different facility after the 60-day period has passed, another benefit period will begin. This will require you to pay an additional deductible before your services are covered by Medicare. It is possible to have several benefit periods within a calendar year.
Keep in mind that in addition to the Medicare Part A deductible, other costs such as coinsurance will also apply. These include coinsurance and, in some instances, a Part A premium. Most people are eligible for premium-free Part A, based upon theirs or their spouse’s work history. According to the Centers for Medicare & Medicaid Services (CMS), approximately 99% of Medicare beneficiaries receive premium-free Part A.
If you or your spouse have not worked for at least 10 years and paid enough Medicare taxes to make you eligible for premium-free Part A, you will also incur the cost of the Part A premium. The maximum monthly premium cost for Part A is $499 in 2022.
Medicare Deductible: Part B
The annual Medicare Part B deductible 2022 is $233. This amount represents an increase of $30 over the 2021 Part B deductible, which was $203.
If you have Original Medicare, you will usually pay 20% of the Medicare-approved costs for healthcare after your deductible has been met.
Unlike Medicare Part A, the Part B deductible is only required once per calendar year. The Part B annual deductible resets every January.
Any covered outpatient expenses you have will go towards meeting your Part B deductible. These include the costs associated with doctor’s visits, laboratory tests and everything else that Part B covers.
What won’t go towards your deductible is the cost of your monthly Part B premiums. In 2022, most people pay $170.10 a month for Medicare Part B.
The Part B premium also applies if you switch to a Medicare Advantage (Part C) plan.
Medicare Advantage (Part C) is an alternative type of Medicare plan that is purchased through a private insurer. Not every Part C plan is available throughout the country. Your state, county and zip code will determine which plans are available for you to choose from in your area. A GoHealth licensed insurance agent will be happy to work with you on your plan options, including those with $0 or low deductibles.
Medicare Advantage plans are required by law to cover at least as much as Original Medicare. Most plans also cover important healthcare extras that Original Medicare doesn’t pay for. These extras vary by plan.
Part C plans often include:
- Prescription drug coverage.
- Routine dental care, including exams, cleanings, X-rays, and dentures.
- Routine vision care including eyeglasses and contact lenses.
- Routine hearing care and hearing aids.
- Gyms or fitness center memberships (SilverSneakers).
- Over-the-counter drug allowance.
The annual deductible you pay out-of-pocket for Part C will be set by the plan you choose. Some Part C plans have $0 or low-cost deductibles. If your Part C plan covers prescription drugs, you may have one deductible for healthcare services and another deductible for medications. These may be $0 each, or higher. Like Original Medicare, the deductible for Part C plans is usually based on the calendar year.
Your Part C plan will also set the other out-of-pocket costs you will be responsible to pay. These include monthly premiums for the plan, which are paid in addition to the Part B premium, as well as copays and coinsurance.
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Medicare Part D is prescription drug coverage. People are often surprised to learn that Part D is not included in Original Medicare. This is understandable since prescription medications are very often integral to health.
Medicare Part D prescription drug plans can be purchased from private insurers, as additional coverage. In addition, many, though not all, Part C plans also include coverage of prescription drugs.
Part D plans have varying deductibles. Each insurer determines what the annual deductible for Part D will be. Your insurer will also determine the plan’s formulary.
A formulary is a list of the prescription medications that each plan covers. Formularies feature multiple tiers. Each tier includes one or more medication types, such as generics, brand names and specialty drugs. They also include information about costs.
Some Part D plans have a $0 deductible, but others may have deductibles that are quite high. In 2022, no Part D plan is legally allowed to have an annual deductible higher than $480.
Medicare Supplement Insurance is also known as Medigap. Medigap is supplemental insurance sold by private insurers. It is designed to fill in the cost “gaps” for people who have Original Medicare.
If you have a Medicare Advantage plan, you are not able to get Medigap.
Medigap pays for some of the out-of-pocket costs that Original Medicare doesn’t cover. It won’t pay for extras not covered by Original Medicare, such as prescription drugs or hearing aids. Rather, it covers some or all of your portion of the costs that are covered under Original Medicare.
Medigap plans typically carry a monthly premium. These plans are standardized by Medicare and must follow state and federal laws that are designed to protect Medicare beneficiaries. Not every Medigap plan is available in every state, county or zip code.
Since the coverage provided by Medigap plans are standardized, they all offer the same basic benefits. Some also offer additional coverage. If you live in Wisconsin, Minnesota or Massachusetts, your Medigap plan may vary from those offered in the rest of the country.
Just like Medicare’s parts, Medigap plans are designated by letter. They are A, B, C, D, F, G, K, L, M and N.
Medigap may cover some or all of your:
Medigap plans sold to newly eligible Medicare recipients do not cover the Part B deductible.
Before January 2020, Medigap Plan C and Medigap Plan F covered the Medicare Part B deductible. However, this coverage is no longer available for new Medicare beneficiaries.
However, if you already have Plan C or Plan F, it will continue to cover your Part B deductible as is stated in your plan.
If you were eligible to enroll in Medicare before January 1, 2020, you may still be able to enroll in Plan C or Plan F and get this type of coverage. If you became eligible for Medicare after that date, you will not be able to purchase a Medigap plan that covers the Part B deductible.
Coverage of the Part A deductible under each Medigap plan is as follows:
Plan A — No coverage
Plan B — 100% coverage
Plan C — 100% coverage
Plan D — 100% coverage
Plan F — 100% coverage
Plan G — 100% coverage
Plan K — 50% coverage
Plan L — 75% coverage
Plan M — 50% coverage
Plan N — 100% coverage
What extra benefits and savings do you qualify for?
You’ve probably heard the one about death and taxes. If you have Original Medicare, you can add deductibles to that list.
If you have Original Medicare (Part A and Part B), you will have deductibles that must be paid, either by you or your Medigap plan.
If you prefer not to pay deductibles, considering a Medicare Advantage Part C plan may make sense.
Part C and Part D plans may or may not have annual deductibles. And while you are still responsible for your Part B deductible if you switch to a Part C plan, some Part C plans help pay your Part B deductible.
Check with your plan’s provider to find out if the plan you’re interested in has a deductible of $0 or more. And, if you need our help, just reach out. GoHealth is here for you.