Although Original Medicare is a government-subsidized health insurance plan, it helps cover many expenses for those who are eligible. This doesn’t mean that it is entirely free, though. There are several costs associated with carrying Original Medicare coverage.
Medicare recipients have the option of enrolling in a Medicare Advantage plan as an alternative to Original Medicare. Understanding your financial obligations can help plan you make the choice that’s right for you.
Before looking at the actual cost of Medicare in 2023, it’s a good idea to understand the different parts of the program. Medicare Parts A, B and D provide inpatient, outpatient and prescription drug coverage, respectively. Your costs may include monthly premiums, deductibles, copayments, and/or coinsurance
What premium costs are associated with Medicare?
Many Medicare recipients receive premium-free Medicare Part A. If you paid taxes for 40 quarters while working, you will get Part A premium-free. If you don’t get premium-free Part A, you may be able to buy it. Part B and Part D usually require a monthly premium to be paid to keep coverage current. Your monthly premiums may depend on your income.
Many Medicare Advantage plans have $0 premiums, but if you enroll in an MA plan, you’ll still be responsible for paying your monthly Part B premium.
Additional cost considerations
An annual deductible usually applies to Part A (hospital insurance), Part B (medical insurance), and Part D prescription drug coverage. There may also be copays and coinsurance costs associated with the use of some parts of Medicare insurance. For example, Medicare Part B covers 80% of outpatient healthcare services and durable medical equipment costs. This means that Medicare recipients are responsible for the remaining 20%.
If you choose to get your benefits through Original Medicare, you may decide to purchase a Medicare Supplement (Medigap) plan. Medigap plans are sold by private insurance companies and can help lower your costs. It’s important to note you can’t buy a medigap plan if you have enrolled in a Medicare Advantage plan.
What does Medicare Part A cost in 2023?
When it comes to the actual cost of Medicare in 2023, some costs are standardized, but many expenses will depend on your income, the plan you choose, and your medical needs.
If you have to buy Part A, the monthly premium will depend on how many quarters you paid taxes while working. You’ll pay $278 per month if you worked between 30 and 39 quarters. If you worked less than 30 quarters, your premium may be $506. The Part A deductible in 2023 is $1,600. After meeting these requirements, inpatient care is covered for 60 days in a hospital or 20 days in a skilled nursing facility. Costs after these allotments have been used up are $400 per day in a hospital or $200 per day in a skilled nursing facility. Hospital care can be extended to a total of 90 days, and skilled nursing facility care can be extended to a total of 100 days.
What does Medicare Part B cost in 2023?
The cost of Medicare Part B premiums in 2023 ranges from $164.90 to $560.50 per month, depending on your income. The yearly deductible for Medicare Part B in 2023 is $226. Once again, a coinsurance split of 80/20 is in place for Medicare Part B expenses. Your overall costs may depend on how often you require services or supplies.
What is the cost of Medicare Part D in 2023?
The cost of Medicare Part D in 2023 depends on your plan, what medications you require, and where you purchase them. Some Medicare recipients must pay an additional premium based on their income. Higher earners can be expected to pay up to $76.40 per month in addition to their Part D plan premiums. The standard deductible for Part D coverage can be no higher than $505 in 2023. Some plans will require copays on certain drugs at purchase. Copays will be based on the plan and tier a prescription is categorized in. Costs can vary, so it’s important to compare plans before enrolling.