Given the complexities of the Medicare program, many individuals choose to seek assistance from Medicare agents who can help them navigate the enrollment process and select the best coverage options for their needs and their budget.
When it comes to understanding your Medicare options and what premiums you can expect to pay, our Medicare agents always want to ensure you are fully informed and know exactly what you’re signing up for. This is why we’re going to outline more information below to guide you through the process and answer any frequently asked questions, particularly when it comes to understanding Medicare Part B premiums.
What are Medicare Premiums?
Medicare premiums are the monthly fees paid by individuals enrolled in the Medicare program to help cover the costs of their healthcare services. These premiums are typically deducted from the individual’s Social Security benefits, or they may be paid directly by the individual if they are not receiving Social Security benefits.
Medicare premiums can change each year, so individuals need to review their plan options and costs annually during the Medicare Open Enrollment Period. Additionally, some individuals may be eligible for financial assistance to help cover their Medicare premiums if they have limited income and resources.
Each Part Has its Associated Premiums
There are several different parts of Medicare that individuals can enroll in, and each part has its own associated premiums. The main parts of Medicare include:
- Medicare Part A: Part A covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health services. Most individuals do not have to pay a premium for Part A if they or their spouse paid Medicare taxes while working.
- Medicare Part B: Part B covers outpatient services, such as doctor’s visits, preventive care, and durable medical equipment. The premium for Part B is typically deducted from the individual’s Social Security benefits and may increase based on their income.
- Medicare Part C (Medicare Advantage): Medicare Advantage plans are offered by private insurers as an alternative to traditional Medicare. These plans may have additional premiums on top of the standard Part B premium.
- Medicare Part D: Part D provides prescription drug coverage. The premium for Part D varies depending on the plan chosen and can increase based on the individual’s income.
Part B Covers Necessary Services for Individuals 65+
This Medicare option aims to help seniors have easier access to a wide range of necessary medical services including doctor visits, outpatient care, preventive services, and medical equipment. In fact, some healthcare providers may only accept patients with Medicare Part B coverage, therefore, if you’re a senior 65+ or are someone with a disability or specific health condition, by signing up for Part B, you can ensure that you have access to a wider network of healthcare providers and facilities.
How Premiums Work
Part B Medicare premiums are the monthly costs that individuals pay for their Medicare Part B coverage. The cost of Part B premiums can vary depending on an individual’s income, therefore, it’s important for individuals to budget for their Medicare premiums and understand how their income level may impact the cost of their coverage. Most people pay the standard premium amount, which is set annually by the Centers for Medicare and Medicaid Services. In 2024, people paid an average of $174.70 per month. If you don’t sign up for Part B when you become eligible, you may be subject to paying an extra 10% to your premiums for each year you could have signed up but didn’t.
Medically Necessary Coverage
Many individuals sign up for Part B because of the necessary services covered, such as:
- Preventive Services: This includes mammograms, colonoscopies, flu shots, etc.
- Mental Health Services: This includes therapy, counseling, medication management, etc. for mental health issues.
- Ambulance Services: This includes getting an ambulance to the nearest medical facility to receive medically necessary care.
- Medical Equipment: This includes equipment such as CPAP machines, wheelchairs, canes, etc. if they are medically necessary and prescribed by your doctor.
- Outpatient Services: This includes receiving care (like x-rays or stitches for example) at a hospital without being admitted, or visiting a health care provider.
What is Not Covered Under Part B?
Some services and treatments are not covered under Medicare Part B, such as:
- Cosmetic procedures
- Dental care
- Vision care
- Acupuncture
- Long-term care
- Massage therapy
- Chiropractic care
Pay Attention to Enrollment Periods
It’s important to understand these enrollment periods and deadlines to avoid penalties and ensure that you have the coverage you need.
Initial Enrollment Period (IEP)
The Initial Enrollment Period is a seven-month period that begins three months before you turn 65, includes the month of your birthday, and ends three months after your birthday. During this period, you can sign up for Part A and/or Part B of Medicare.
General Enrollment Period (GEP)
If you missed your Initial Enrollment Period, you can sign up for Part A and/or Part B during the General Enrollment Period, which runs from January 1 to March 31 each year. Coverage will begin on July 1 of that year.
Special Enrollment Period (SEP)
This enrollment period is for individuals who qualify for a special circumstance, such as losing employer-sponsored health coverage, moving out of the coverage area of their current plan, or becoming eligible for other assistance programs.
Work With a Professional to Determine What is Best For You
Understanding these enrollment periods and deadlines is crucial for ensuring that you have the appropriate Medicare coverage at the right time. But most importantly, you must understand each Part to determine what works best for your particular health, especially as you continue to age. If you have any questions or need help with the Medicare process, it’s highly recommended that you work with a Medicare agent.
Emily Trevino, Senior Managing Partner at Wise Insurance, leverages her extensive background in biology and business finance to master Medicare, health insurance, and retirement planning. With over a decade in the field, Emily has co-authored “Medicare Breakdown – The Alphabet Soup of Medicare,” marking her as a pivotal figure in insurance education. Her commitment extends through active participation in the National Association of Benefits and Insurance Professionals (NABIP) and speaking at major industry events. Emily’s drive for community service and personal resilience shines through her adventurous pursuits and dedication to societal well-being. Connect with Emily on LinkedIn to explore the future of informed insurance decisions.
