Medicare Premiums and Deductibles for 2018

So what are the new Medicare premiums and deductibles for 2018? Well...Who would have ever guessed pretty much everyone of them went up again?  I know...I know... a little sarcasm goes along way!!  So...Medicare part A typically does not have a monthly premium for most folks.  If you are someone that worked enough to earn 40 credits, then you do not have a premium for part A of Medicare.  So how does someone know if they earned all 40 credits or not?  Well...If you paid Medicare taxes in for a total of at least 40 quarters then you have earned your 40 credits.  The easiest way to put it is.  If you worked at least 10 years and paid your Medicare taxes during those 10 years, then you should have earned your 40 credits.  So again...If you did work the 10 years and earn the 40 credits, you do not pay a part A premium.  If you did not pay into Medicare enough to earn the needed credits, then you could be looking at paying up to $422 per month just for part A of Medicare...Wow!!

So let's break down Medicare part A.  So like I said...Typical Medicare part A does not have a premium, but it does have deductibles and coinsurance or copay.  Part A has a deductible this year of $1,340 for each benefit period.  After meeting the deductible here is a look at what you would be responsible for:

  • Days 1-60:  $0 coinsurance for each benefit period.
  • Days 61-90:  $335 coinsurance per day of each benefit period
  • Days 91 and beyond:  $670 coinsurance per each "lifetime reserve day" after day 90 for each benefit period.  You have only 60 "lifetime reserve days" available.
  • Beyond lifetime reserve days:  All costs are your responsibility.

There are some options available to help take care of some or all of what Medicare doesn't pay on your part A coverage.

 

Medicare part B does have a monthly premium that everyone is responsible for.  Some may receive help paying their part B premium, but like I said everyone is responsible for their part B premium.  This years part B premium actually did not go up.  It stayed the same as 2017, which is $134 per month.  Unless you were new to Medicare in 2017 and took the current part B premium of $134 then you probably was not paying this amount last year.  The 2% raise in Social Security this year is the reason why the majority of Medicare members seen a rise in the part B premium.  Take a look at my previous blog to find out details on why this is.

So part B has a monthly premium and part B also has a yearly deductible.  That deductible this year is $183.  This deductible only has to be met once each year.  After the deductible is met you typically pay 20% of the Medicare-approved amount for most doctor services, outpatient therapy and durable medical equipment.  Medicare pays the other 80%.

Medicare part B has no maximum out of pocket. This is important to know!  If you choose to take original Medicare then your out of pocket expense will never have a cap to it.  Just like part A there are some options that can help take care of part or all of Medicare doesn't pay on your part B coverage as well.

 

Medicare Part C is another option that is available. Medicare part C plans are also called Advantage plans. You do have the option to take a part C plan instead of staying with part A and B.  If this is the choice you take then you will enroll in an Advantage plan that is at least as good as original Medicare.  This plan has to give you a maximum out of pocket amount. These plans typically eliminate your part A and B deductibles and you wind up with predictable copays instead. These plans also sometimes add extra benefits that are not covered by original Medicare, like dental, vision, hearing and sometimes over the counter benefits.  Part C plans are administered by a private insurance company.  The biggest downside to taking a part C plan or an Advantage plan is that you are required to see providers that are contracted to be in network with the providers plan that your'e enrolled in.  Otherwise Medicare Advantage plans are a great option to help you get greater benefits than offered by original Medicare.  These plans typically have low or sometimes no monthly premium on top of what you have to pay to original Medicare.

 

Part D of Medicare is the final part, which is your prescription drug coverage.  Part D or prescription drug plans, like part C plans are administered by private insurance companies.  your part D premiums vary by plan along with what drugs they cover.  It is very important to review your part D plan each and every year during the Annual Election Period or AEP.  Just because a drug plan is working for you this year does not mean it's formulary  will not change and there may be a better plan for you to be on.

 

Well...I hope this helps clear up a little bit for you. If you have any questions, please post your comments and I will respond. You can email your questions or comments to josh@davisinsuranceresource.com  or give me a call @ 501-458-9803.

Thanks,

Josh Davis

 

 

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