Does Medicare Have a Deductible?

By - October 7, 2020

Health insurance exists to help pay for everything from routine doctor visits to emergency surgery. While this is ideal when faced with large medical bills, it’s important to remember that many health insurance plans, including those offered by Medicare, require you to meet a deductible amount before your benefits begin to apply toward medical costs.

The difference between a premium and a deductible
You’ve probably heard about premiums and deductibles when it comes to health insurance, but maybe you aren’t entirely sure what these terms mean. Simply put, a premium is an amount paid to the insurance company, usually monthly, to obtain your benefits This amount must be paid according to your plan’s payment schedule in order to keep your insurance current.

A deductible is an amount that you will need to pay out of your own pocket for medical services until you reach your deductible requirement. Once the deductible has been met, your insurance benefits will begin to pay for medical costs according to the terms and conditions of your policy.

Does Medicare have a deductible?
As stated, Medicare plans often involve a deductible, but the deductible can vary from person to person depending on what options and plan you choose when signing up for Medicare benefits. When you first qualify for Medicare, you’ll have the chance to decide what health insurance products you want and need to address your unique medical concerns.

Medicare Part A is the inpatient hospital benefit and covers services provided if you’re admitted to a hospital or skilled nursing facility. For 2020, the Part A deductible that must be met is $1,408. This amount may change each year, so you will need to talk with your plan provider or confer with a representative from Medicare to find out the exact deductible for the current year in which you are receiving benefits.

Medicare Part B is the outpatient benefit and covers things like routine appointments with your doctor and diagnostic testing and lab work. It also offers Medicare benefits for things like durable medical equipment, preventive services, and outpatient surgery. The deductible for 2020 is $198, so you will need to incur medical costs to meet or exceed that number before Medicare begins to provide coverage.

Medicare Part D is the prescription drug benefit, and this is optional coverage. Some Medicare Part D plans do not have a deductible at all, but if your plan does have a deductible, the annual maximum can’t exceed $435. As a result, if you carry this coverage, you will need to talk to your plan provider to learn about the specific amount required for your plan’s deductible.

Medicare Advantage and deductible requirements
Medicare Advantage plans usually bundle the Part A and Part B benefits of Original Medicare with other additional coverage into one simple plan. You may be able to receive extra services or benefits and lower out-of-pocket costs by signing up for a Medicare Advantage plan. These plans vary from provider to provider, so you will need to talk directly with your plan administrator to learn about deductible requirements for your unique situation.

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