Medicare Deductible 2023 - 2024

Having a Medicare deductible is a vital part of your healthcare plan. It ensures you're paying a manageable amount out-of-pocket for your health care. This is especially true if you're on a Medicare Advantage plan.

Part A

Often referred to as hospital insurance, Part A of Medicare is a program that pays for inpatient hospital and skilled nursing facility care. The program also covers hospice care and home health care.

The Medicare Part A deductible is the amount you must pay before Medicare starts paying its share. The deductible is not an annual deductible but rather a deductible for each benefit period. In 2023, the deductible is $1,600 per benefit period.

You may also be required to pay a copayment. The copayment is a fixed amount based on the national median charge for the service you are using. You can opt for supplemental insurance to cover this, if available. The co-payment is generally 20% of the total charge.

The Centers for Medicare & Medicaid Services releases new premiums and deductibles each fall. They are indexed to the growth in Part D per capita spending. You may qualify for a lower bonus if you have a high income.

Another deductible to know about is the Part D defined standard benefit. It requires a higher deductible, higher initial coverage costs, and more out-of-pocket spending.

If you qualify for the Medicare Savings Program, you can get help paying your Part B premium. Contact your state Medicaid office to learn more. You can also apply for a Medigap policy. These policies will pay some or all of your Part A and B deductibles.

Medigap plans

Unlike Original Medicare, Medigap plans offer standardized benefits for deductibles and copayments. Private insurance companies sell these plans. In most states, the policies are standardized. However, some states have their own rules for the rates and benefits.

Some states require insurers to sell Medigap plans to younger Medicare enrollees. In these cases, the policy must be at least as comprehensive as the standard Medicare Select plan.

Most Medigap policies also offer additional benefits. These may include coverage for services that Original Medicare does not cover. These can include deductibles, copayments, and out-of-pocket limits.

The most popular Medigap policy is Plan G, which covers all medical costs after the deductible is met. Besides being the most comprehensive plan, it has lower out-of-pocket costs than Plan F. It is the top choice for all Medicare enrollees.

Private insurance companies offer a Medigap policy, which can be purchased from any licensed company to sell it. Although premiums vary from company to company, Medigap is guaranteed to continue if the policyholder pays dividends.

Other plans include Plan N, which offers copayments of up to $50 for emergency room visits. Two plans are only available to individuals previously eligible for Medicare. Plan L and Plan K cover a smaller percentage of benefit costs than other plans.

Part D

The drug benefit has been significant among the many things Medicare has done to lower out-of-pocket costs for enrollees. However, the cost of prescription drugs is set to increase, and several proposals are working to address this issue. Several factors contribute to this increase, including the rate of inflation, the number of Part D enrollees, and the plan’s ability to negotiate drug price discounts.

The Congressional Budget Office estimates that in 2022, spending for Part D will be $111 billion. This represents 15% of total Medicare outlays.

The Part D benefit does not have a hard cap on out-of-pocket spending, but policymakers have proposed several proposals to address this issue. Among them, one idea is to require manufacturers to pay rebates to enrollees if the price of a drug increases faster than the rate of inflation. This could make it difficult for drug companies to sell their products.

Another proposal addresses the lack of financial incentives for Part D plan sponsors to control drug costs. This could change how the program works. Some plans offer $0 deductibles for lower-cost drugs, but beneficiaries may still have to pay for some of their drug costs. This option is available through the Extra Help program.

The Affordable Care Act changed how the definition of the benefit is calculated. Now, the manufacturer discount on brand-name drugs counts towards the out-of-pocket threshold.

See Medicare Part A and B deductible for 2024 below. The Medicare deductible amount is updated every year by the Centers for Medicare and Medicaid Services.

At the time of writing—2023—Medicare Part A deductible is $1,408 and Medicare Part B deductible is $198. While Medicare Part A deductible is a lot more than Part B, oftentimes, Medicare beneficiaries don’t pay monthly premiums for Part A. That is if the beneficiary is paid Medicare taxes for more than 40 quarters.

With that said, if you’ve been working for more than 10 years, you aren’t going to pay Medicare Part A premiums. That is because you’ve paid Medicare taxes under FICA taxes. In addition to this, you may pay more than what’s set by the CMS for Part B. As of now, the Medicare Part B standard monthly premium is $144. If you are considered a higher-income beneficiary, you are likely to pay more than the standard monthly premium.

Medicare Part A Deductible 2024

Medicare Part A covers the costs of hospital stays. Although the deductible is quite a bit higher, after the deductible is met, the beneficiary only pays coinsurance for the number of days in the hospital. The 2020 figures for the coinsurance are

  • $0 for 1 to 60 days
  • $352 for 61 to 90 days
  • $704 for more than 90 days

There is one thing you should know about hospital stays for more than 90 days for each benefit period though. For every day after 90 days, you will use your lifetime reserve days. Learn more about lifetime reserve days.

Since there is still time for the CMS to announce the Part A deductible, we can only speculate how much it might be. From 2023 to 2024, Medicare Part A deductible increased by $44. If the increase would be the same as in 2024, Medicare Part A deductible would increase to $1,452.

Medicare Part B Deductible 2024

On the other hand, Part B deductible went from $185 to $198 in 2023. Again—if the increase were to be the same, Medicare Part B deductible would be $211. With all this said, in 2024 Medicare Part A premium should be $1,452 and Part B deductible $211.

Medicare Part B covers the medical costs but prescription drugs aren’t included. For that, you must have Medicare prescription drug coverage (Part D). If you have a Medicare Advantage Plan, all of these might be covered under a single plan. For more information on both the prescription drug coverage and Medicare Advantage Plans, read this article.

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button