Medicare rules and benefits can be confusing. Here’s a guide to show what’s new for 2018. If you haven’t signed up for Medicare yet, this information can help you understand your choices.
Part A (hospital insurance) is half of what is often called Original Medicare. It covers hospitalization, other institutional care, and home health services. Most people don’t pay for Part A because of their work histories. For those who buy Part A, the premium is $422 each month. People who paid Medicare taxes for at least 7.5 years can buy Part A at a discounted premium of $232.
Part A costs increased this year. The deductible is $1,340 for each hospitalization with no copay for the first 60 days of hospitalization and $335 per day for days 61–90 of hospitalization. Beyond 91 days, your cost is $670 per “lifetime reserve day” day for the next 60 days.
Part B (medical insurance) is the second half of Original Medicare. It covers diagnostic, preventative and mental health care, as well as office visits, ambulance service, and durable medical equipment.
The standard Part B premium of $134 will remain the same for many people or will be slightly lower for some people who receive social security. The income levels that trigger higher premiums have changed. Individuals with incomes between $85,000 and $107,000, and couples with incomes between $170,000 and $214,000 annually will pay a premium surcharge. Their premium will be $187.50 per month. For incomes between $107,000 and $133,500 for singles and $214,000 and $267,000 for couples, the premium is $267.90. For singles with income between $133,00 and $160,000 ($267,000 and $320,000 for couples), the premiums are $348.30 each month. For singles whose income is above $160,000 and couples with incomes above $320,000, premiums are $428.60.
The Part B deductible will remain $183 per year.
Some people opt for Part C coverage, sometimes called Medicare Advantage (MA), instead of Parts A and B. Depending on your plan, Part C might also replace Part D (prescription coverage). Part C plans cover what Parts A and B cover and often offer vision, dental, and hearing coverage. This is still Medicare, but is administered by private companies approved by Medicare.
Premiums are projected to drop and more plans are expected to be available. However, this will not be true universally because plans vary according to geography and the scope of coverage.
Part D is prescription drug coverage. If you have Original Medicare (Parts A and B), you can opt for prescription coverage through Part D. For 2018 the national base premium is $35.02 per month. Higher income individuals and couples will pay premium surcharges between $13.00 and $74.60 each in addition to the base premium. Drug coverage is often included in Part C plans. If your Part C covers prescriptions DO NOT enroll in a Part D plan without checking with your current insurer because doing so could lead to you being dropped from your Part C plan.
Before you enroll in a Part D program, check to see whether you are eligible and whether you have prescription coverage from another source such as veterans’ benefits or benefits from a former employer. Costs will vary depending on factors such as your medications, the pharmacies you use and whether you qualify for extra help. Check which available plan is best for you.
Medicare Supplement or Medigap plans are private plans you can buy to supplement your Part A and B coverage. You are not eligible while you have a Part C plan, but may elect to change coverage from Part C to Original Medicare and Medigap during approved times. Medigap policies can result in lower total healthcare costs even if they have high premiums. You will have to investigate which plans are available in your state to see whether a Medigap plan is right for you.
New Medicare Cards
You will get new Medicare Cards in the mail this year at no cost to you. The old cards used Social Security numbers as identifiers. The new cards will have a unique Medicare Beneficiary Identifier (MBI) made up of 11 numbers and capital letters instead. This change is to better protect you from identity theft and privacy breaches. The Centers for Medicare and Medicaid Services (CMS) will start sending the new cards in April. Be sure that the Social Security Administration has your correct address. The new cards do not have any effect on Medicare benefits.
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