Ever wonder why people might think Medicare is free? They probably heard about premium-free Part A.
One of the biggest cost-savings available under Medicare is premium-free Part A, for those who are eligible. This is the perk awarded to U.S. senior citizens who have paid taxes to Social Security their whole lives (or at least ten years). And for many, this makes a significant difference in their healthcare costs. While everyone has to pay premiums for Part B, the higher costs for Part A can be a hindrance to budgeting under fixed incomes. For additional savings with your Medicare costs, you can apply to a Medicare Savings Program, find a low-cost Medicare Advantage plan, or add a Medicare Supplement plan.
Who Qualifies For Premium-Free Part A?
If you are over 65 and qualify for Medicare, you are eligible for premium-free Part A if you or your spouse have at least 40 calendar quarters of work in a job where you paid payroll taxes to Social Security, or are eligible for Railroad Retirement benefits.
Those who worked and paid taxes to Social Security for 30 to 39 quarters will pay $259 each month in 2021. People who work fewer than 30 quarters will pay $471 each month in 2021 for Part A.
Everyone who is eligible for premium-free Part A qualifies for Part B.
What Other Costs Do You Pay For Part A?
Even if you receive Part A with no premiums, you are still responsible for the other costs associated with hospital insurance. These include coinsurance, copayments, and deductibles. The Part A deductible is $1,484 in 2021 for each benefit period. Benefit periods begin when you are admitted as an inpatient in a hospital or skilled nursing facility. It ends when you go 60 days without receiving inpatient care. There is no limit on the number of benefit periods in any year.
While inpatient in a hospital, you will owe nothing in coinsurance for the first 60 days. Days 61 to 90, you will be responsible for a daily coinsurance of $371 in 2021. Days 91 and onward, you will owe a daily coinsurance of $742 in 2021 until you have used up your 60 lifetime reserve days. After this point, you are responsible for all costs. Each of these stays is calculated per benefit period.
Inpatient stays in a skilled nursing facility have lower coinsurance costs. For the first 20 days, you owe no coinsurance. Days 21 to 100 of each benefit period, you will owe $185.50 in daily coinsurance. After day 100 of each benefit period, you will owe all costs.
You will pay 20 percent of the Medicare-approved amount for any durable medical equipment and a 5 percent copayment for hospice prescription drugs. For hospice care at your home or a nursing home you live in, Medicare will not pay for your room and board. You will owe 20 percent of the Medicare-approved amount for mental health services you receive while you are an inpatient in a hospital.
To find out more about Part A, give Cornerstone Senior Advisors a call now!