What does it cost?

That depends on the type of coverage and plan you choose, and your situation. So, check to see what you’ll have to pay.

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Can someone explain Medicare costs to me simply?

We’d be glad to. Typically, there are costs you pay and costs your Medicare plan pays. The types of costs you have can vary. For example, Original Medicare (Parts A and B) may have different costs than a Medicare Advantage plan (Part C).

There are two basic types of cost:

1. Your regular monthly payment for healthcare coverage (your premium)

2. Your share of the cost for healthcare services you receive (this includes deductibles, copays, and coinsurance)

Let’s see how each of these costs work:

For most people, there is no monthly premium for Part A (Hospital Insurance). The federal government assesses a Part B (Medical Insurance) premium, which usually is deducted right from your Social Security benefits.

With a Medicare Advantage plan (Part C), you’ll pay the Part B premium plus an additional plan premium, but there are options with very low or even $0 monthly plan premiums.

There are separate premiums for a Medicare prescription drug plan (Part D) and Medigap policy (if you add those to Original Medicare).

This is a set amount you may need to pay for healthcare services before your Medicare coverage starts paying its share. Until your total costs reach this amount, you pay.

When you see a doctor or specialist, visit a hospital or other facility, or have a medical procedure done, this is the amount you may need to pay at the time of your visit.

Plans with coinsurance typically split the cost of covered healthcare services with you after you pay any deductible. You might pay 20%, for instance, while your plan pays 80%.

What additional Medicare cost issues should I consider?

Here are a few tips when weighing plan costs.

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Think beyond premiums.

If you are choosing a Medicare Advantage plan, it’s best to look at all your costs, not just the premium.

For example, a lower monthly premium could mean a higher deductible, higher copays, higher coinsurance, and so on.

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Weigh your options.

Adding a Medigap policy to Original Medicare can cover some costs not paid by Medicare. But Medigap policies tend to have high monthly premiums, so consider whether you’ll actually be saving on your costs.

In addition, your cost for healthcare services may be lower with a Medicare Advantage plan than Original Medicare.

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Watch your out-of-pocket costs.

“Maximum out-of-pocket” is the most you’ll have to pay for healthcare services in a year. Medicare Advantage plans have a maximum out-of-pocket limit. Original Medicare doesn’t.

Having this limit gives you more control over expenses and may reduce risk, as your plan will pay 100% of covered medical services after you reach this amount.

I have Medicaid. Will I pay less for Medicare coverage?

Yes. When you are “dual eligible,” most of your healthcare costs will be covered by Medicare (though Medicaid may pay for some services not covered by Medicare).

Medicaid members can get Medicare coverage through either Original Medicare or a Medicare Advantage plan.

As a Medicaid member, you may benefit from:

Extra Help: Help with what, you ask? Some or all of your prescription drug coverage (Part D) premiums, deductibles, coinsurance, and/or copayments. (Note: If you have limited income but aren’t on Medicaid, you may also qualify for this benefit, also known as Low Income Subsidy.)

People with Medicaid get Extra Help automatically when they enroll in Medicare. Those without Medicaid who qualify for Extra Help must enroll on their own through the Social Security Administration.

Medicare Savings Program: This program helps pay your Medicare Part A and/or Part B premiums, deductibles, and/or coinsurance. You may have to enroll in the Medicare Savings Program separately, even if you already have Medicaid.

The Medicare Savings Program also allows you to sign up for an Original Medicare plan outside of your Initial Enrollment Period and before the General Enrollment Period.

Special Needs Plans (SNP): This type of Medicare Advantage plan provides dual-eligible members with added benefits and savings, at little or no cost to them.

I understand how the costs work. Now how do I decide what Medicare coverage I need?

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