Having trouble figuring out how much Medicare really costs?
Stay tuned, because I’ll be sharing with you the results of our research as well as some of the hidden costs. We analyzed hundreds of plans and combinations of plans to come up with projections that give people good numbers to use as part of their planning process for life with Medicare. We’ll also point out some of the hidden costs that may turn out to be game changers for you and your family.
But first a brief introduction. My name is Greg Howard. I’m regional manager for USA Benefits Group, author of Medicare Made Easy, a 3-step guide to enrolling in Medicare, trainer for the CPA societies of both MO and KS on healthcare, host of the internet radio show "Would the Real Obamacare Please Stand Up", and a Medicare broker since 2009. All of that and $5 will get you a cup of coffee at Starbucks...
Having said all of that, now let’s take a look at how much Medicare really costs.
For most people, there are basically two options.
Option 1 is made up of Original Medicare plus a prescription drug and a Medicare Supplement plan (Medigap).
The average cost of Part A’s for most people is zero.
Part B averages $134/mo.
Prescription coverage typically costs about $25.
And Medigap plan G, which covers everything except the Medicare Part B deductible runs approximately $140/mo.
That brings the total to $297/mo with an annual maximum out of pocket excluding prescription co-pays and premiums, of $183.
Option 2 is Medicare Advantage (MA).
These plans are offered by private insurance companies and look a lot like the health plans for the under 65 market with deductibles, co-pays and coinsurance.
Again there is typically no cost for Part A but you still have to pay your Part B premium.
Most MA plans include prescription drug coverage at no additional cost and the average MA plan in 2018 runs about $40.
So the total per month is approximately $164.
As I noted earlier, MA plans are structured much like the health plans for those under 65. They have deductibles, co-pays and coinsurance which depending on the plan you choose can run as high as $6700 per year in out-of-pocket expenses.
ADDITIONAL HIDDEN COSTS
MA plans are network specific, meaning that BCBS has their network of doctors and hospitals, Humana has theirs, United Healthcare has a different network. So you have to be careful to use “in-network” providers. If you happen to choose or need a doctor that is out of network, some MA plans don’t count those costs toward your $6700 maximum out of pocket. (i.e. you get to pay the whole bill). There’s a hidden cost buried in the fine print.
A final consideration regarding the cost of MA plans is that a combination of multiple hospital stays over the calendar year end can result in your out-of-pocket expenses being as high as $13,400 over say a 6-month period.
So although MA plans appear to be less expensive, they have more hidden costs than Option 1. All good reasons to consult with an experienced Medicare broker who can guide you to plans that limit these liabilities rather than an agent representing just one company.
MEDICAID AND MEDICARE
If by chance you qualify for Medicaid, you will want to choose a MA plan as Medicaid will typically pay some or all of the related costs shown here.
So now you know, in general, how much all this stuff costs.
WHAT SAY YOU? (comments from some of our current customers)
A previous posting of this information garnered this response from Linda in Springfield MO.
“The Medicare Made Easy folks helped me understand the monthly costs involved in Medicare as well as some of the hidden costs that could have been very hard for me to deal with in the future. I decided I’d rather pay a little more every month and not end up with a big bill to pay if I get sick. Thanks so much for helping me carefully plan for my future.”
Linda B – Springfield MO
WHAT TO DO NOW
To determine which Medicare plans best fit your situation, take our FREE Medicare Made Easy Survey. 6 easy yes/no questions. One of our experienced Medicare brokers will personally review your answers, recommend specific plans and explain why he/she thinks these are the best fit for you and your family.
The recommendations are vendor neutral, meaning we won’t reference any specific insurance company (we're not trying to sell you something). These are generic recommendations of Plan G or Plan F or Medicare Advantage or any one of over a thousand combinations. Take advantage of our years of experience in Medicare and know before you go shopping, what you are shopping for. To take the quiz now, just click on the link below. It's easy.