You are probably just about to turn 65 and have heard about Medicare the cover issued by the Federal Government to seniors that age and above. Now that the time is coming for you to enroll in the program, you have wondered about the cost of Medicare in 2018. A cover is not useful to you at all if you cannot afford it.
Medicare Part A and B is a legal requirement when you enroll. You can also opt to take on a Medigap cover to help reduce your out of pocket expenditure but is it worth it? There is also Part D that covers your prescription medication. If however, you opt to go for the Medicare Advantage plan you may have more options.
You have probably done all your research but have not gotten a lot of information about how much all these will cost except maybe, it depends. I am going to try and give you specific figures where they are available and at least a range of areas where it depends. In the end, you will have a rough estimate of the financial implications of the plans.
Part A and Part B costs
Medicare Part A also called free-Medicare, or Hospital Insurance is cost-free if you worked for at least 40 quarters or 10 years. If you have only worked for 30 quarters or less, you will pay a $413 a month. On the other hand, if you worked for between 30 and 39 quarters before being enrolled for Medicare part A, you pay $227 premium.
The deductibles for Part A amount to $1,316 per benefit period. A benefit period begins when you start receiving hospital or skilled nursing facility services for which Medicare pays. The benefit period ends when you stop receiving the services or when you do not receive Medicare paid services for 60 consecutive days.
You will not incur any coinsurance for the first 60 days. You will pay $329 for between 61 and 90 days. When you exceed 90 days, you will part with $658. Medicare only caters for 90 days per benefit period after which you can opt to use your lifetime reserve days which are just 60 for your lifetime. When you use your lifetime reserve days, you pay for all your hospital and skilled nursing facility costs.
Everyone pays for Part B, but unlike Part A premiums, these depend on your income and the type of tax returns you file. For instance, if you earn $85000 and less and file individual tax returns, your premium will be $134. $134 is the lowest amount for those not receiving social security benefits. The amount you pay per month could go to as little as $109 if you are receiving Social Security benefits.
What are the Costs Medicare Advantage plan, Medicare Part D and Supplemental Insurance for Medicare?
Private insurance companies on contract to the Federal Government issue Medicare Advantage Plan or Part C of Medicare. Though the services offered are somewhat standardized, they are also differentiated. Some of the factors that determine the cost of Medicare Advantage include; if the plan pays for your Part B premiums, what the copayments, deductibles, and coinsurance amounts are when you see a doctor, whether you visit in-network facilities or not and if you get help from Medicaid.
The cost of Medicare premiums in 2018 for Part D relies on your income amount and type of tax return filed. For $85000 and less as well as individual returns, you do not pay an additional premium what you pay for Part B. if you earn between $85001 and $107,000 and file personal returns, your cost will be $13.30. For incomes in the bracket of $107,000 and $160,000, you will part with $34.20. Revenues between $160000 and $214,000 attract a monthly charge of $55.20. If you earn more than $214,000, it will cost you $76.20 per plan. These premiums are in addition to your Part B premiums. For joint returns, brackets simply divide your income by two to find out where you lie.
Rates for Supplemental Insurance for Medicare depend on the issuing company and the plan you choose. For plan A, the premiums range between $165 and $983. The lowest amount paid for plan F is $240, and it goes as high as $617. If you opt for plan G, the cheapest cover you can get is for $190, and the average costliest one is $482. For N, the range is between $146 and $318. Plan F high deductible plans are relatively low priced and can cost you as little as $50, but then your out-of-pocket costs are comparatively higher than other programs.
What Plan Is Best For You?
As stated earlier, the program you choose should be dependent on what you can afford. Part A and B are the cheapest, but you also end up paying out of pocket expenses. The out-of-pocket costs can be offset or at least reduced by Medigap, but that will mean an additional fee for you. When you are on original Medicare, you have to but Part D to receive prescription coverage. Even so, after you have spent $3,700 in a year on prescription drugs, you will pay up to 40% of your medication cost from there on.
Medicare Advantage is a more comprehensive package than Original Medicare. It can include prescription Medicine but cannot co-exist with Medigap. You may also opt only to pay Medicare Advantage premiums and have them pay for your Part A and B. With Medicare Advantage; there is also an annual out-of-pocket ceiling after which you may not pay for any extras. The maximum limit for coinsurance, deductibles, and copayments, does not exist with the Original Medicare.
For you to qualify to purchase Medicare Advantage and even supplemental insurance, you should be eligible for part B and also pay a premium for the same. You will need to sit down and compare all the plans and possibly ask for advice from a financial planner to determine what you can afford in the long run. At the same time, the cost of Medicare is not the only thing to consider, the state of your health may also help you decide.
You may need a slightly more costly package but comprehensive package if you have severe health issues. You also need to consider convenience, for example, Medicare Advantage plans pay for emergency care even when you are out of your area. Original Medicare also may not over for eye and dental appointment but Medicare Advantage will. The best and most prudent route to take is to shop around and ask questions about the facilities you can visit, copayments, coinsurance, and deductibles that will arise and whether or not chronic illnesses are covered and choose what is convenient both for your health and your pocket.