Your deductible is the amount of money you have to pay for your prescriptions and healthcare before Original Medicare, other insurance, or your prescription drug plan starts paying for your healthcare expenses. The Medicare Part B deductible for 2020 is $198 in 2020. This deductible will reset each year, and the dollar amount may be subject to change.
Every year you’re an enrollee in Part B, you have to pay a certain amount out of pocket before Medicare will provide you with coverage for additional costs. Almost any item or service that Part B covers will count toward your deductible. For example, say you fall and break your arm. You go to the emergency room to get treatment.
Part B would cover the cost of the care if you are treated as an outpatient, and Medicare Part A would cover any services receive if you are formally admitted as an inpatient. In this instance, the charges for the treatment, doctor, and the sling will count toward your Part B deductible. If you stayed in the hospital as a result of your broken arm, these expenses would go toward your Part A deductible amount of $1,408.
Part A and Part B have their own deductibles that reset each year, and these are standard costs for each beneficiary that has Original Medicare. Additionally, Part C and Part D have deductibles that will vary from year to year and plan to plan. Some are as low as $0, while others are a few hundred.
You’ve Reached Your Medicare Part B Deductible, Now What?
What happens when you reach your Part A or Part B deductible? Typically, you’ll pay a 20% coinsurance once you reach your Part B deductible. This coinsurance gets attached to every item or service Part B covers for the rest of the calendar year.
In this instance, you’d be responsible for 20% of the bill under Part B. Medicare would then cover the other 80%. The coinsurance amount you pay is 20% of the amount Medicare approved. This approved amount is the maximum amount your healthcare provider is allowed to charge you for an item or service.
If you refer back to your broken arm example. Say your treatment cost you $80. If you broke your arm before you reached your Part B deductible amount of $198, you’d have to pay the full $80 for your care or whichever amount you had left to hit your $198 cap. If you already met your deductible, you’d only have to pay for 20% of the $80. This works out to $16. Medicare would then cover the final $64 for the care.
Getting Help Paying Deductibles
There are a few ways you can go about avoiding having to pay the deductibles for Part A or Part B. We’ve outlined them below.
Medicare Supplement, or Medigap, insurance plans are sold by private insurance companies to help pay some of the costs that Original Medicare does not. They can offer coverage for some of the expenses you’ll have as a Medicare beneficiary like deductibles and coinsurance.
An alternative to Original Medicare, a Medicare Advantage, or Medicare Part C, plan will offer the same benefits as Original Medicare, but most MA plans include additional coverage. Most MA plans will have an annual out-of-pocket maximum limit.
Extra Help Program
Finally, the Extra Help program is something low-income Medicare and Medicaid recipients typically automatically enroll in. This program will cover the Part D costs of prescription drugs.