Health care can be expensive for seniors, even if you have Medicare. Medicare requires beneficiaries to share in the cost of services through deductibles, copayments, coinsurance and other out-of-pocket expenses. That’s why millions of Americans buy Medicare Supplement Insurance.
Original Medicare Health Insurance Costs
As a Medicare beneficiary, you may be responsible for the following health care expenses:
Most Medicare recipients don’t have to pay a premium for Medicare Part A (hospital insurance). However, those who haven’t paid enough taxes (at least 10 years worth) while they worked may have to pay a Part A premium. These costs can be as high as $422 per month. Medicare Part B (medical insurance) is optional and requires recipients to pay a monthly premium. The average Part B premium in 2018 is $134 per month.
*Medicare Supplement Insurance doesn't help pay for premiums.
As with other forms of health insurance, Original Medicare requires that you pay a certain amount out of pocket before the insurance starts paying their share. The Medicare Part A deductible is $1,340 per benefit period (in 2018), while the Part B deductible is $183 per year.
Medicare Part B requires beneficiaries to pay 20% of all Medicare-approved costs of services. For a $1,000 doctor bill, then, Medicare would pay $800, while you would pay $200 (deductibles and other fees aside). As you can imagine, these costs can add up.
Instead of paying a percentage for a particular service, you pay a set dollar amount. Certain Part B services may require a copayment.
Medicare Supplement Insurance Helps Pay Insurance Costs
Medicare Supplement Insurance is sold by private insurers and help pay some of the out-of-pocket costs specifically associated with Medicare.
In most U.S. states, you’ll be able to select from 10 standardized Medigap plans. Each plan offers a different set of basic benefits, but all 10 plans must provide at least partial coverage for:
- Medicare Part A coinsurance and hospital costs
- Medicare Part B coinsurance or copayment
- First three pints of blood
- Medicare Part A hospice care coinsurance or copayment
A few other basics to know about Medicare Supplement Insurance:
- You become eligible for a Medigap plan when you are both 65 years old and enrolled in Medicare Part B.
- You may be able to buy a Medigap plan if you're under 65 and disabled, but availability varies by state.
- Medigap plans only cover one person, so your spouse will need to sign up for his or her own plan.
- Medigap plans don’t cover dental care, vision care or prescription drugs.
Use the chart below to compare all 10 standardized Medigap plans.