It's important to budget for your health care costs if you have Medicare. Unfortunately, your costs can be substantial, especially if you need a lot of health care. Medicare only covers about half of a typical person's costs. On average, people with Medicare spend about $5,000 a year on health care costs Medicare does not pay for. What are your Medicare costs in 2017?
A lot of your costs depends on your income, which Medicare plan you choose--traditional Medicare or a commercial Medicare health plan (here are four key differences)--and the health care you need. But, your premiums and deductibles are predictable.
You must have Medicare Part A and Part B, regardless of which Medicare plan you choose. All Medicare health plans must cover a range of preventive care services and almost all medically reasonable and necessary services (except vision, hearing and dental services). Your costs are as follows: Medicare Part A, which covers inpatient hospital and skilled nursing facility care, is free for most people--anyone who has worked or whose spouse has worked at least 40 quarters. If you need to buy Part A, you'll pay up to $413 each month. Medicare Part B premium, which covers doctor and other medical services, is $109 a month for about 70 percent of people, but some people with annual incomes under $85,000 pay $134.00. You will pay $134 a month if you're not receiving Social Security benefits, enrolling in Part B for the first time in 2017 or have Medicaid as well as Medicare, in which case your state Medicaid agency will pay the premium. If your annual income is above $85,000, you also will pay more. To see what your premium is, click here.
- $1,316 deductible for each inpatient hospital benefit period, up to 90 days (with 60 days outside the hospital or skilled nursing facility before a new benefit period begins). After that, you pay nothing for the first 60 days of each hospital benefit period, $329 daily coinsurance for each benefit period beginning on day 61 through 90, $658 daily coinsurance for each of your 60 "lifetime reserve days" of coverage after day 90, and all costs after your lifetime reserve days are used up.
- For skilled nursing facility care, no deductible but $164.50 a day for days 21-100.
- For home health care or hospice care, no deductible or coinsurance.
- $183 deductible each year before Medicare covers medical services from doctors and other health care providers, and, after you meet your deductible, coinsurance of 20% of Medicare's approved amount for most doctor services, outpatient therapy, and durable medical equipment.
- For Part D prescription drug coverage, you pay a separate premium and coinsurance.
- You may have to pay a deductible before your coverage kicks in, which varies based on the health plan you choose; and,
- You will have to pay a copay--a fixed amount--or coinsurance--a percentage of the cost--for each service you receive in the plan's network, which also depends on the health plan you choose.
- Your total out-of-pocket costs so long as you use in-network doctors and hospitals depend on which health plan you choose and how much care you need, up to $6,850 out of pocket in 2016. (Medicare.gov does not list the out-0f-pocket limit for 2017.)
- If you use doctors and hospitals that are out of network (as about one in three people with Medicare need to do if they have a complex condition), you will generally need to pay the full cost of your care except in emergencies and urgent care situations; there is no out-of-pocket limit for out-of-network care.
You usually need to pay the full cost dental care, hearing care and vision care. You also will need to pay out of pocket for care when you travel outside the United States. Here are some ways to keep these costs down.
