What does Part B cover?

Medicare Part B generally covers “medically necessary services” & preventive services

• Medically necessary services – services or supplies that are needed to diagnose or treat your medical condition & meet accepted standards of medical practice

• Preventive services – Health care to prevent illness (ex: flu) or detect it at an early stage when treatment is most likely to work best

What can I expect to pay for Part A and Part B (Original Medicare)?

Part A

• Usually you will not pay a monthly premium for Part A coverage (Hospital Insurance) if you or your spouse paid Medicare taxes while working.

Part B

• Most people will pay the standard Part B monthly premium amount of $174.70 in 2024 (a $9.80 increase from 2023)

  • If your modified adjusted gross income (MAGI) is above a certain amount, you may be required to pay an Income Related Monthly Adjustment Amount (IRMAA)

    • Medicare uses the MAGI from 2 years ago in the current year’s calculation

  • Many people already receiving Social Security the last couple of years have paid less than the Medicare standard premium.  This is because of the Hold-Harmless provision when the Part B premium increases more than their cost-of-living increase for Social Security benefits.

• You will pay the standard premium amount (or higher) if you meet 1 of 5 requirements this year

  • Enrolling in Part B for the first time

  • You don’t get Social Security Benefits

  • You are billed directly for Part B premiums

  • You have Medicare & Medicaid, and Medicaid pays your premiums

  • Your MAGI from 2 years ago is above a certain amount

Part B Deductible & Coinsurance

• The annual deductible for Part B is $240 in 2024. After this is met, you will typically pay 20% of the Medicare-approved amount for the following:

  • Most doctor visits

  • Most doctor services while you are a hospital inpatient

  • Outpatient therapy

  • Durable medical equipment

What does Part C (Medicare Advantage Plan) cover?

Part C is offered by private companies that contract with Medicare to provide you with all of your Part A & Part B benefits. Medicare Advantage Plans must cover all services that Original Medicare (Part A & Part B) covers, except hospice care, and is provided by private insurance companies.

• In most plans, you will need to use doctors, hospitals & other providers allowable under your specific plan or you will pay more or pay all of the costs

• The plan has the ability to choose not to cover the costs of services that are not medically necessary under Medicare

  • Check with your provider before you get the service if you are unsure whether a service is covered

A helpful resource to compare plan options in your area is the Medicare Plan Finder.

What does Part D (Prescription Drug Plan) cover?

Part D adds prescription drug coverage & is offered by insurance companies and other private companies approved by Medicare. Each Medicare Prescription Drug Plan has a unique list of covered medications. These medications are organized into different “tiers” based on the specific plan with each tier having a different cost.

What does Medicare Supplement Insurance (Medigap) cover?

A Medigap policy is sold by a private company & can help pay some health care costs not covered by Original Medicare (ex: coinsurance, deductibles, medical care when you travel outside the U.S.)

• You must have Medicare Part A and Part B in order to purchase a Medigap policy

How does Medicare work with other insurance?

When you have other health insurance/coverage, each is considered a “payer”. When there is more than one payer, “coordination of benefits” rules apply to decide which one pays first.

• Primary payer pays up to the limits of its coverage

• Secondary payer then pays if there are uncovered costs remaining that the primary insurer did not cover

  • The secondary payer may not pay all of these uncovered costs

• If your employer insurance is secondary, you may need to enroll in Medicare Part B before that insurance will pay anything

Are there any unique/special Circumstances?

Special rules apply to those with Railroad Retirement Board (RRB) benefits and/or disability benefits, in addition to other things. Contact your financial planner if you think you might have a special circumstance.

Check out these additional sources of information from The Center

• Navigating the Medicare Maze Webinar

• The Official National Medicare Handbook

• Hold-Harmless Provision Blog