Although Medicare provides coverage for certain healthcare services, there are some out-of-pocket costs associated with Medicare plans. To stay enrolled in a Medicare plan, you must pay the specified monthly premiums, deductibles, coinsurance, copayments, and other charges. These costs may change each year. 

Below are the 2021 costs that you can expect for the Medicare plans.

Medicare Part A

If you paid up to 40 quarters of Medicare taxes while employed, you qualify for premium-free Part A. For beneficiaries who do not qualify for premium-free Part A, the monthly premium in 2021 is $471. Enrollees who paid above 29 tax quarters but less than 40 tax quarters will pay $259. 

There are also other Part A expenses you have to cover, such as deductibles, copayments, and coinsurance. In 2021, the deductible for Medicare Part A is $1,484. If you are admitted to an inpatient facility, Medicare Part A will cover your expenses for the first 60 days. After the first 60 days, you will pay a $371 coinsurance for each day until the 90th day. After the 90th day, this amount increases up to $742. 

Part A beneficiaries who failed to enroll during the Initial Enrollment Period will pay a 10% premium increase as the late enrollment penalty. This is not a permanent penalty, however. You would have to pay this penalty for twice the amount of time you were eligible for Part A but never enrolled. For example, if you went without Part A coverage for three years, you would have to pay the Part A penalty for six years.

Part B 2021 Costs

Generally, the monthly premium for Part B in 2021 is $148.50. However, individuals with incomes above the modified adjusted gross income limit will pay an additional fee separate from the standard premium. Apart from the monthly premium, there are other Part B costs such as deductibles and copayments. In 2021, the annual deductible for Medicare Part B is $203. 

For outpatient therapy, doctor services, and durable medical equipment, Part B beneficiaries will cover 20% of the costs. However, some home healthcare services and clinical laboratory services that are approved will cost $0. Other costs may be specific to your coverage.

Medicare Advantage and Part D

For Medicare Advantage, the 2021 costs depend on the type of plan and the insurance companies. However, the average Part C monthly premium is $21. Part C also has a maximum out-of-pocket limit, which is $7,550 for 2021. 

The Part D premium is an average of $30.50 but can be as low as $7 or as high as $100. It just depends on the number of prescriptions you need covered and the insurer you purchase the plan from. Part D plans also have a maximum deductible of $445. However, some Part D plans can go lower or have a $0 deductible.

For more information about the 2021 costs for Medicare, contact us at Simple Retirement Benefits.