What are Medicare Insurance Deductibles?

Posted on May 26, 2024 By Jeff Snyder

If you’ve ever reviewed or had a health insurance plan, whether that’s a private plan or Medicare insurance, you’ve likely seen or dealt with a deductible. You may have never even stopped to think about how they influence your coverage. Do all Medicare insurance plans have a deductible?

These are fairly important questions, and the answers can change your mind about which plans to choose. Let’s break down exactly what deductibles are and how you may encounter them with the Medicare program.

What are Deductibles?

Within insurance, deductibles are a set amount you must pay before the insurance plan’s coverage kicks in. You can find deductibles in many kinds of insurance coverage. While they are often a set dollar amount they are sometimes a percentage of the overall value of the insured item, like that for property or certain types of environmental risks. In order to receive the full extent of coverage that your insurance plan offers, you’ll need to reach this limit with applicable payments from services.

While the majority of health services require the deductible to be met to receive full coverage, some things may be covered prior to meeting your deductible.

For health care services, does this mean that you’ll be stuck paying for all your costs until you hit the Medicare insurance deductible? Not necessarily. While the majority of health services require the deductible to be met to receive full coverage, some things may be covered prior to meeting your deductible. This will differ depending on the insurance plan, so it’s a good idea to do a little research before signing on to a specific plan. For Medicare insurance beneficiaries, we can go into some more specifics that may help you make decisions about your coverage.

Original Medicare Insurance Deductible

What is the deductible for Medicare insurance? Well, in Original Medicare, there are two deductibles you’ll encounter. In Medicare Part A, there’s an inpatient hospital deductible that you’ll owe each benefit period. Once you’ve paid that much for inpatient health services in a single benefit period, your Medicare insurance coverage will kick in. In Medicare Part B, the other half of Original Medicare, there’s a general deductible. Once you’ve paid enough applicable services, Medicare Part B will cover 80 percent of the Medicare-approved amount, and you’ll only owe the remaining 20 percent.

This doesn’t mean that you’ll have no coverage or benefits from your Medicare insurance plan prior to reaching your deductible. Some services are covered before you reach it, like preventative care. This includes services like your Annual Wellness visit or the flu shot. Of course, there’s another way you benefit from your Medicare insurance plan before reaching your deductible. If you’re using a doctor or health service that accepts Medicare assignment, they’ve agreed to charge you at an agreed upon price. This price is usually lower than what the health care provider would normally charge for those services. In this sense, you’re already receiving benefits from your Medicare insurance coverage, even if you haven’t reached your deductible yet.

While it’s unlikely you’ll qualify for a plan that covers the Part B deductible (unless you were eligible for the Medicare program prior to January 1, 2020), most Medigap plans offer some coverage of the Part A deductible.

Finally, a Medicare Supplement (also known as Medigap plans) is one method of reducing or even eliminating a Part A or Part B deductible. While you can only qualify for a plan that covers the Part B deductible if you were eligible for the Medicare program prior to January 1, 2020, most Medigap plans offer some coverage of the Part A deductible. All but one standardized Medicare Supplement plans offer at least partial coverage of the Part A deductible. Plans K, L, and M help cover 50 percent, 75 percent, and 50 percent of it, respectively, while the rest cover it in full. Only Plan A does not offer Part A deductible coverage.

Medicare Advantage and Part D Deductibles

Similarly, many Medicare Part C (also called Medicare Advantage) plans have an annual deductible. Since Medicare Advantage plans are offered by private insurance companies as alternatives to Original Medicare, these plans may have differing deductibles. As Original Medicare alternatives, they’re required by the Centers for Medicare & Medicaid Services (CMS) to cover what Original Medicare covers at minimum. You should expect the same pre-deductible services covered as with Original Medicare.

Medicare Part D is a privately offered prescription drug coverage plan that pairs with your Original Medicare coverage. It too may have a deductible. Much like Medicare Advantage plans, these deductibles will vary from plan to plan. Unlike Medicare Advantage, though, CMS regulates the maximum limit that a Part D deductible can be.

When it comes to choosing a plan, whether that’s a Medicare Advantage or Part D plan, the deductible is a worthwhile factor to take into account. Going with the lowest deductible may not be the best call, though. High-deductible plans often balance out that initial cost to the beneficiary by having lower premiums or higher coverages once you reach that deductible.

Whether it’s about the complex ins-and-outs of the Medicare program or the basics of your coverage, you never have to be embarrassed to ask a question. Don’t be ashamed to ask questions and learn more about the Medicare program. It’s the best way to take a firm grasp of your coverage and your health care!

This entry was posted in Medicare Insurance and Tagged Chastain Agency LLC, Gainesville GA