What Are the Medicare Part A and Part B Deductibles?
Navigate your Medicare costs. This guide explains how deductibles work within your federal health insurance, clarifying your financial responsibilities.
Medicare is a federal health insurance program for individuals aged 65 or older, certain younger people with disabilities, and those diagnosed with End-Stage Renal Disease. It helps cover a range of healthcare costs. Understanding how deductibles function within Medicare is important for beneficiaries to manage their healthcare expenses. This article clarifies the concept of deductibles.
What a Medicare Deductible Is
A deductible in health insurance represents the amount an individual must pay for covered healthcare services before their insurance plan begins to pay. For Medicare beneficiaries, this means paying an initial cost out-of-pocket before Medicare contributes its share for services received. Once this deductible is satisfied, Medicare typically covers a portion of the costs, and you may pay a coinsurance or copayment for the remaining amount.
Medicare Part A Deductible
Medicare Part A, known as hospital insurance, covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health care services. For 2019, the Medicare Part A deductible was $1,364. This deductible applies per “benefit period,” which is distinct from a calendar year.
A benefit period begins the day you are admitted as an inpatient to a hospital or skilled nursing facility. It ends when you have been out of a hospital or skilled nursing facility for 60 consecutive days. Because the deductible is per benefit period, it is possible for a beneficiary to pay the Part A deductible multiple times within a single calendar year if they have separate benefit periods.
Medicare Part B Deductible
Medicare Part B, referred to as medical insurance, covers outpatient services, including doctor’s services, medical supplies, preventive services, and outpatient care. The Medicare Part B deductible for 2019 was $185. Unlike Part A, this is an annual deductible. Once the annual Part B deductible is met, Medicare typically pays 80% of the Medicare-approved amount for most covered services. The beneficiary is responsible for the remaining 20% as coinsurance.
Deductibles in Medicare Advantage and Part D
Medicare beneficiaries have options beyond Original Medicare (Parts A and B), such as Medicare Advantage Plans (Part C) and Medicare Part D Prescription Drug Plans. Medicare Advantage Plans are offered by private companies approved by Medicare and often combine Part A, Part B, and typically Part D coverage. These private plans are permitted to set their own deductibles, which can vary significantly from Original Medicare.
Many Medicare Part D plans, which cover prescription drugs, also include a deductible. The standard Part D deductible for 2019 was $415. However, some Part D plans may offer a lower deductible or even no deductible at all, depending on the specific plan chosen. Deductibles for both Medicare Advantage and Part D plans are plan-specific, emphasizing the importance of reviewing individual plan details.