Before you enter the world of Medicare, it’s a great idea to estimate what your potential Medicare costs may be.
We have put together a Medicare Cost Worksheet that will help you estimate your costs.
We can also pair you with an agent who can go over this Medicare Cost Worksheet with you if you need help or feel overwhelmed.
The important thing to know is that Medicare costs go beyond monthly premiums. You need to consider the other insurance costs, such as deductibles, copayments, and coinsurance. Also, don’t look past coverage gaps – areas where you’re not covered at all.
Common areas of missing Medicare coverage include:
- Long-term care
- Dental care, including dentures
- Vision care
- Hearing care
- Transportation and lodging costs when you need to receive specialized care in a different area
- Experimental drugs, especially with cancer treatments
- International costs if you travel and need medical care outside of the United States
- Chiropractic care
There are other types of insurances you can choose that will help cover these gaps. You can speak to an agent about these, but most commonly, Medicare enrollees take a hard look at long-term care insurance, Cancer plans, and Medicare Supplements.
Medicare Part A
Medicare Part A is premium-free, meaning you don’t need to pay a monthly cost for being enrolled.
The deductibles and coinsurance are set up as follows:
- $1,632 deductible
- Days 1-60: $0 coinsurance
- Days 61-90: $408 coinsurance
- Days 91+ $816 coinsurance per “lifetime reserve day,” which caps at 60 days
- Beyond lifetime reserve days: You pay all costs
For beneficiaries in skilled nursing facilities, the daily coinsurance for days 21 through 100 of extended care services in a benefit period will be $204 in 2024.
Cost of Medicare Part B
Medicare Part B does have a monthly premium, which is $174.70 per month as of 2024. If you make more than $103,000 by yourself or $206,000 as a couple, your monthly premium will be higher than that.
The deductible for Medicare Part B is $240 per year. After you meet the deductible, you typically pay 20% of the Medicare-approved amount.
A Medicare Supplement can cover your deductible and coinsurance if you choose to implement one.
Cost of Medicare Part C or Medicare Advantage
Medicare Advantage often lures people in due to its added benefits like low monthly premiums, dental care, eyeglasses, and free gym memberships.
However, be aware that there are hefty deductibles and copayments involved that could be up to $8,850. It’s difficult to switch to a Medicare Supplement once you’re enrolled in Medicare Advantage.
Read More: Medicare Advantage vs. Medicare Supplements: How Do You Choose?
Often times, a Hospital Indemnity plan can help you cover those out-of-pocket costs, but most seniors find original Medicare and a Medicare Supplement is a better deal.
Also know that your plan’s benefits along with your premiums can change from year to year.
Cost of Medicare Part D
Medicare Part D drug costs vary wildly depending on the following factors:
- Which drugs you take
- The plan you choose
- Which pharmacy you go to
In essence, the more drugs you take, the more expensive your premium will be. There are dozens of different insurance carriers to choose from, and they all have different prices. You can easily compare what your individual plan would cost by doing a comparison on Medicare.gov.
Please know that a lower monthly premium does not mean a cheaper drug plan. Medicare.gov’s comparisons will show you the total cost for the year, which is what you want to compare. Often times, a drug plan will have a higher premium, but a lower yearly cost.
The other major cost factor is the late enrollment penalty. The window where you may sign up for a drug plan is during your Initial Enrollment Period (the 7-month window around your 65th birthday).
If you choose not to sign up for a Part D drug plan – perhaps you don’t take any prescriptions – the penalty is 1% of the national base beneficiary premium multiplied by the number of months you didn’t have Part D drug coverage (or any other credible coverage). You then round up or down to the nearest 10 cents.
Medicare Supplemental Insurance Costs | Medigap Plan Costs
The average cost of Medicare Supplement Insurance varies depending on which plan you choose, how old you are, what gender you are, what your zip code is, and whether or not you’re a tobacco user.
It varies too greatly to display an average dollar amount for everyone here – invariably, you will see large fluctuations from person to person. Please contact us to get a quote!
Keep in mind that there are a variety of Medigap plans, and the full-coverage plans cost more than the low-coverage plans.
Read More: A Full Comparison of Medicare Supplement Plan G vs. Plan N
