When you apply for Medicare coverage, you will automatically qualify for Original Medicare, which is made up of Part A and Part B. This coverage is meant to help cover the costs of inpatient and outpatient expenses respectively, and it is important to be aware of what each specific plan covers and the potential costs associated with it.
When to Apply for Medicare Benefits
Medicare coverage becomes available to individuals once they reach the age of 65 or under the age of 65 when they qualify due to certain disabilities. You are first eligible to apply for Medicare three months before you turn 65. This marks the beginning of the Initial Enrollment Period, which lasts for seven months. You are required to apply for Medicare during this period to avoid getting extra fees charged to you.
The only way to avoid getting an extra fee is to apply for an extension. You may qualify for an extension if you are still employed during your Initial Enrollment Period and are currently getting medical coverage through your or your spouse’s employer’s health care plan. It is important to know that this extension only applies to Medicare Part B. You are still required to apply for Medicare Part A during the Initial Enrollment Period.
If you do request an extension for Part B, you will be eligible to apply for Part B coverage during any month that you are still receiving alternative healthcare through the employer. This extension known as a Special Enrollment Period. This period begins the month that you retire or that your healthcare benefits end and lasts for a total of eight months.
If you are receiving healthcare insurance from an employer, it is also important to consider how large the company is. If the employer has fewer than 20 employees, they have the option of requiring you to sign up for Medicare Part B during your Initial Enrollment Period, causing Medicare to serve as your primary insurance and your employer’s insurance to serve as secondary insurance.
What Does Part B Cover?
Part B Medicare benefits are designed to cover outpatient procedures, tests, and preventive care. This can include regular visits to your healthcare provider, visits to specialists, imaging tests to diagnose health issues, outpatient procedures, durable medical equipment expenses, and much more.
How Much Does Medicare Part B Cost?
Unlike Medicare Part A, Part B is associated with a monthly premium cost. This is why Medicare allows you to request an extension so that you can avoid paying for two healthcare plans simultaneously. The Part B premium is standard for all Medicare recipients and is on a sliding scale based on adjusted income.
The base premium payment for 2020 is $144.60 for everyone with an annual income of less than $87,000 or joint filers with an income less than $174,000. If you are above this income threshold, your premium payment may increase to up to $376 per month if you file as an individual and up to $491.60 if you file jointly.
Part B Medicare recipients are also required to pay an annual deductible in addition to the monthly premium payments. The annual deductible for 2020 is $198, which is up from $185 in 2019. Then, after this deductible is met, you are still required to pay a coinsurance amount.
This amount consists of 20 percent of the Medicare-approved amount of a certain service. The Medicare-approved amount is a set cost that Medicare has agreed to reimburse facilities for a specific test, procedure, or service. Even if the facility often charges patients more than this amount, they will only be able to bill the approved amount, with you being responsible for 20 percent of the cost.
This coinsurance cost only applies at providers that accept Medicare assignment and partner with them to provide care. If you visit a physician or facility that does not accept assignment, you will be forced to pay the entire amount out of pocket as opposed to just 20 percent.