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What does Medicare Part A and Part B cover?

By Colton Mortensen

First of all, it is important to know that Medicare Parts A and B are the only parts covered by the federal government. Everything else is covered by Private Insurance companies. Parts A and B do cover a lot but there are some very important gaps that you need to know about and we will cover those in this post.

Part A

Part A’s main purpose is to cover inpatient care in a hospital. It also covers hospice care, home health care and care at skilled nursing facilities so long as certain conditions are met. You can read more about coverage conditions in another post.

Most people pay $0/month for their Part A premium so long as they qualify for it. Most qualify for it if they or a spouse has worked and paid into the Medicare tax for a certain period of time (40 quarters or 10 years). One may also qualify for premium free Part A if they’ve been receiving disability benefits for 24 months from Social Security or Railroad Retirement Board. Some also qualify for it if they have End-Stage-Renal-Disease or some other conditions. Part A can still be purchased if not qualified to receive it premium-free.

Some of the costs associated with Part A [2023] are as follows:

  • $1,600 Inpatient hospital care deductible per benefit period: covers first 60 days
  • $400/day coinsurance for days 61-90
  • $800/day coinsurance for days 91-150 (these are called lifetime reserve days and can only be used once and do not regenerate like the other deductibles and daily copays do)
  • You are responsible for all inpatient hospital costs after these benefits are used.
  • $200/day for days 21-100 in a skilled nursing facility (days 1-20 are covered by Medicare) so long as certain conditions are met.
  • You are responsible for all skilled nursing facility costs after 100 days.

Part B

Part B covers outpatient services like doctor/specialist visits, surgeons, emergency room, labs, and ambulance.

Part B premiums will vary from person to person and is mainly based on income but the standard Part B premium for 2021 is $148.50. Depending on your income you may pay the standard premium and an Income Related Monthly Adjusted Amount or IRMAA.

Some of the costs with Medicare Part B [2021] are as follows:

  • Annual Deductible – $226
  • 20% coinsurance of approved amount after the deductible is met
  • Part B excess charges – If a healthcare provider does not accept Medicare “assignment” for the Medicare approved amounts for services they are limited as to how much they can charge for those covered services. The most they can charge for Medicare covered services is 115% of fee schedule amount for non-participated providers.

How to cover these gaps

There are different ways to go about covering the coverage gaps associated with Medicare. The two most common ways available are to either choose a Medicare Supplement plan (AKA Medigap plans) which will help cover the costs you would normally be responsible for or to enroll into a Medicare Advantage plan. There are pros and cons to both options which I will go over in another post.

I hope you found this information valuable and if you would like to talk to someone about what is available to you in your area please reach out to us and we will be happy to serve you!

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