What is Medicare Part B?
If you are going to be turning 65 soon, then you might be thinking ahead about going online or heading to your local Social Security office and signing up for Medicare Part B medical insurance. After all, you are probably looking forward to having this medical coverage in addition to the hospital coverage that is offered by Medicare Part A. If you are like many people who are just turning 65, you might not know very much about Medicare Part B medical insurance. This guide will help you have a better understanding of the coverage that you will have and what you will need to do to enroll. This makes navigating the system a whole lot easier!
What does Medicare Part B cover?
You might already know that Medicare Part A is your hospital insurance. This coverage is designed to provide coverage when you have to spend time in a hospital or skilled nursing facility. Medicare Part A pays for some home health care services, too.
Medicare Part B is your medical insurance and provides coverage for many things that a standard health insurance policy provides coverage for. It pays for two main types of services:
- Preventive Services – Preventing illness or detecting and treating it quickly is typically the best treatment option. Medicare Part B covers preventive care for this purpose.
- Medically Necessary Services – Medicare covers many supplies and services that are designed to either diagnose or treat various medical conditions. Medically necessary services and supplies must meet the accepted standards of medical practice in order to be covered by Medicare.
Once you sign up for Medicare Part B Medical insurance, you’ll find that it will cover many things. These are a few examples of what your Medicare Part B Medical insurance will pay for:
- Limited outpatient prescription drugs (in most cases, though, this should be covered by a Medicare Part D prescription drug plan)
- Seeing another doctor to get a second opinion before undergoing surgery
- Inpatient, outpatient and partial hospitalization for mental health purposes
- Durable medical equipment
- Clinical research
- Ambulance services
- Doctor visits
- Physical therapy
- Basic, necessary health services
It can be confusing regarding what Medicare Part B does and does not pay for. This is normal, and you shouldn’t be afraid to ask questions. Most doctors and other healthcare providers are accustomed to working with patients who rely on Medicare coverage and have a pretty good knowledge of what is and is not covered. It is never a bad idea to ask your doctors or other healthcare providers about whether or not treatments or services will be covered by Medicare. This can help you avoid a costly and unexpected bill.
Eligibility: Who Qualifies for Medicare Part B?
If you are or will be eligible for premium-free Medicare Part A, then you will also be eligible for Medicare Part B as soon as you are eligible for premium-free Medicare Part A.
You cannot just sign up for Medicare Part B when you want to. Instead, you can only enroll during certain times of the year.
If you are required to pay a premium for Medicare Part A, such as if you did not pay in enough to the Social Security and Medicare system during your working years, then you must meet the following qualifications in order to enroll in Medicare Part B:
- You must be at least 65 years old
- You must be either a U.S. citizen or a U.S. citizen who is a legal resident and who has been living in the United States for the last five years continuously
If you have been receiving Social Security benefits or Railroad Retirement Board benefits for four months and are eligible for premium-free Medicare Part A and Part B, then you will be automatically enrolled in both. You do have the choice to refuse Part B coverage if you do not want it, however.
Enrollment Periods: When to enroll in Medicare Part B Enrollment?
Unlike Medicare Part A — which you can sign up for at any time if you are eligible for premium-free Medicare Part A — you cannot sign up for Medicare Part B at any time. Instead, you can only sign up during certain enrollment periods.
Medicare Part B Initial Enrollment Period
There is a seven month Initial Enrollment Period. During this time, you can sign up for Medicare Part A, Medicare Part B or both. This time period starts three months before you turn 65 and lasts for three months after you turn 65. If you wait until the month that you turn 65 or after to sign up for Medicare Part B, though, be aware that your coverage will be delayed and that you could end up with a gap in coverage.
It is best to sign up for coverage during your Initial Enrollment Period. If you don’t, you could be charged a late enrollment penalty for Medicare Part B.
If you are interested in signing up for one of the Medicare Advantage plans instead of Original Medicare, then you can also sign up for your plan during the Initial Enrollment Period. Be aware that there are major differences between having this type of insurance plan versus having Original Medicare through the federal government. For some, though, this is a good way to get additional coverage for medical services and to have drug coverage, since it is included in some plans.
Medicare Part B General Enrollment Period
In addition to your Initial Enrollment Period, you also have the chance to sign up for Medicare Part B during the General Enrollment Period. This is your opportunity to sign up if you did not sign up during your Initial Enrollment Period and if you don’t qualify for a Special Enrollment Period.
The General Enrollment Period is the same for everyone and runs from January 1st to March 31st each year. If you sign up during this period, your coverage will begin on July 1st.
Medicare Part B Special Enrollment Period
In some certain circumstances, you may have a chance to sign up during a Special Enrollment Period.
If you are covered by a group health plan through your employer or your spouse’s employer, then you are in a continuous Special Enrollment Period. You can choose to sign up for Medicare Part B at any time, as long as you are eligible for it.
If you lose your job or retire and accept your retirement benefits, or if your group health coverage ends for other reasons, then you will have an eight-month period during which you can enroll in Medicare.
Medigap Open Enrollment Period
It’s important to be aware of the Medigap Open Enrollment Period if you would like to sign up for additional coverage.
The Medigap Open Enrollment lasts for six months and begins during the first month that you are 65 years old and enrolled in Medicare Part B. This is the best time to sign up for a Medicare Supplement policy if you are interested in signing up for one.
This is the best time to sign up for a few reasons. The first reason is because you have Guaranteed Issue Rights during this time period. You do not have to worry about medical underwriting during this time period. This means that you cannot be turned down for a Medicare Supplement policy because of health conditions, and you cannot be charged a higher rate because of these health conditions either.
You don’t have to sign up for a Medicare Supplement plan during this time period. However, doing so can help you enjoy the most options for coverage and can help you purchase the most affordable policy.
Naturally, before signing up for a Medicare Supplement policy, you should compare the different plans and what they cover. You will also want to shop around for rates from different insurance companies. Even though insurance companies cannot charge you higher rates for medical conditions if you purchase your policy during your Medigap Open Enrollment Period, different companies do charge different rates. Shopping around will help you find a plan with excellent and affordable coverage.
Medicare Part B premiums: How Much Does it Cost?
Recipients of Medicare Part B are required to pay a Part B premium. However, the premium does vary based off of income. The standard premium for 2020 is $144.60 per month. However, for those with higher incomes, the premiums are a bit more expensive. Even with these added Part B costs, though, most people find that Medicare Parts A and B are well worth the cost. Also, be aware that most Medicare beneficiaries do not have to pay premiums that are higher than the standard.
Monthly premiums based off of beneficiaries who file individual tax returns with annual income:
- Less than or equal to $85,000 – $135.50
- $85,001 to $107,000 – $189.60
- $107,001 to $133,500 – $270.90
- $133,501 to $160,000 – $352.20
- $160,001 to $499,999 – $433.40
- $500,000 to $750,000 – $460.50
Monthly premiums based off of beneficiaries who file joint tax returns with annual income:
- Less than or equal to $170,000 – $135.50
- $170,001 to $214,000 – $189.60
- $214,001 to $267,000 – $270.90
- $267,001 to $320,000 – $352.20
- $320,001 to $750,000 – $433.40
- Greater than or equal to $750,000 – $460.50
Coverage Gaps: Medicare Part B deductible and coinsurance amounts
The annual deductible for Medicare Part B in 2020 is $198 for all beneficiaries. Some Medicare Supplement plans will pay for the deductible so that beneficiaries do not have to pay this amount out of pocket.
There is some additional cost-sharing that you should know about. After your deductible has been met for the year, you will typically be required to pay 20 percent of Medicare-approved costs for healthcare services. Again, if you have a Medicare Supplement, you can get help with these costs so that you can reduce your out-of-pocket expenses.