2023 Medicare Out-of-pocket Costs
Change is the one thing you can count on in life, and yes, Medicare expenses change too. From year to year, annual deductibles go up slightly, as do:
Deductibles for 2023
Here are the details you need to know.
For Medicare Part A your work and tax history determine whether you pay a premium or not. Here’s how it breaks down:
For Medicare Part B, a monthly premium is standard. In 2023, your Part B premium is $164.90, and for incomes above a set amount, it could be higher. Below a certain amount, it’s possible to qualify for help through a Medicare Savings Program.
For Medicare Part C (Medicare Advantage), premiums vary from plan to plan, and you can even find Medicare Advantage plans costing $0/month. But remember that on top of any premium, you have to pay your Medicare Part B premium.
For Medicare Part D (prescription drug coverage), premiums will vary, plan to plan.
What are my other 2023 Medicare costs?
In addition to deductibles and premiums, coinsurance or copayments are also your responsibility. Your Medicare Part A coinsurance costs look like this:
Skilled nursing facility care:
As far as Part B goes, once your deductible has been met, you’ll generally pay 20% of the Medicare-approved amount for services from a physician, which includes hospital inpatient stays. Outpatient therapy and durable medical equipment will also require a 20% coinsurance payment.
Should I consider a Medigap plan for my Medicare out-of-pocket costs?
A Medicare supplement (Medigap) plan is designed precisely to help fill the gaps in your Parts A and B coverage. You get to find the right one for your particular health and financial needs from among 10 Medigap plans. And because they’re standardized — having the same benefits no matter where you’re buying them — it’s pretty simple to shop for the one you want. Did you know that every plan may pay for an inpatient hospital stay up to a year after exhausting your Medicare benefits? Comparing plans is as easy as entering your zip code and clicking on the free quote button.
Still confused? Call us!
Table of Contents
I’m going to be living on a modest fixed income after I turn 65. What can I expect my Medicare costs to be?
Your basic costs look like this: Deductibles — Medicare Part A will cost $1,600 per benefit period. Medicare Part B will cost $226 per year. Premiums — There is no Part A premium, and the 2023 Part B premium is $164.90. Coinsurance — Your Part A coinsurance is $0 coinsurance for the first 60 days of each benefit period, $400 a day for the 61st to 90th days of each benefit period, $800 a day for days 91 and beyond per each lifetime reserve day of each benefit period (you get up to 60 lifetime reserve days). With Part B, once your deductible is paid you’ll be responsible for 20% of doctor’s costs, including hospital stays.
This is exactly what they were designed for. A Medigap plan will help you cover gaps in your Part A and Part B insurance, specifically your deductibles, coinsurance, and copayments.
- Best overall Medicare supplement for new enrollees: Plan G.
- Best overall Medicare supplement before 2020: Plan F.
- Best low cost Medicare supplement: Plan K.
- Best alternative to Plan G Medicare supplement: Plan N.
Medicare Supplement policies are private health insurance designed to cover gaps in Original Medicare. They are also known as Medigap plans. These take care of costs such as copays, coinsurance, and deductibles which can become expensive if you need regular care from a doctor or hospital. If you need medical care while traveling outside the U.S., you can buy Medigap policies to help cover those costs. As a supplement to Original Medicare, you’re required to have Part A and Part B before you canget a Medigap policy. This way, Medicare is responsible for the Medicare-approved costs of the covered care, and the remainder is covered by your Medigap plan.
Optimal coverage comes with higher costs, making Plan F the most expensive Medigap plan. Plan F is known as “first-dollar coverage” and it takes care of everything provided during a doctor or hospital visit. Your only responsibility is for dental, vision, medications, and equipment, such as hearing aids.
The Federal government ended the Plan F option for new enrollees last year to keep the healthcare system from being overused by patients who had their deductibles covered. The next best coverage after Plan F is Plan G.
Medigap Plan G offers every advantage of Plan F except for the deductible, which you have to cover. Because it isn’t as comprehensive as Plan F, Plan G is more affordable.
For people who don’t go to the doctor often, Plan K is worth considering. It is the most affordable because it provides just 50% of Medicare Part B coinsurance, the Part A deductible, blood, skilled nursing, and Part A hospice costs. For comparison, Plan G and others offer full coverage of these expenses, and more.
It’s hard to argue against plans which cut your traditional Medicare costs. For most people, having the extra coverage these supplemental plans provide is common sense, unless they want the specific features of a Medicare Advantage plan.
Most people would benefit from not having to pay out-of-pocket to stay healthy. Medicare supplement insurance or a Medicare Advantage plan offer vital savings now, but are indispensable should a catastrophic health issue occur.
Of the 10 Medicare-approved Medigap plans, Plan G and Plan N are the most popular. Plan F is no longer available to new Medicare enrollees as of 2020, but it is still popular among people who bought this plan prior to 2020.
- Plan F$128–$342
- Plan F (high deductible)$22–$88
- Plan G$106–$325
- Plan G (high deductible)$29–$58
Before getting a Medicare supplement plan, you need to be enrolled in Medicare Part A (hospital insurance) and Part B (medical insurance). People with Medicare Advantage Plans who want to go back to Original Medicare can buy a Medigap policy prior to switching.
The security of having lower or no out-of-pocket healthcare costs can offset the premiums you’ll have to pay for whichever Medigap plan you choose, which vary depending on the benefits offered.
The national average cost for Medicare Supplement Plan F is $1,824 annually, which is $152/month; Medigap Plan G will cost you around $143 per month.
Since Plan F was discontinued for new enrollees as of 2020, Plan G offers the most coverage for people 65 and older. It has a lower premium than Plan F and duplicates its benefits, except for the Part B deductible.
It depends on your specific needs, but for most people a Medigap plan is very useful in supplementing the coverage of Medicare Part A and Part B. A Medicare Advantage plan is an affordable way to get healthcare coverage not offered by Original Medicare.
Historically, Plan F has been the most popular because it covers all the out-of-pocket costs Medicare does’t pay for. This includes the 15% extra charge billed by providers who do not take Medicare as full payment.