2023 Medicare Deductibles: Maximize Your Medicare Benefits
- In 2023, the Medicare Part A deductible is $1,600 per benefit period, and the Medicare Part B deductible is $226 per year. Medicare Advantage deductibles, Part D drug plan deductibles and Medicare Supplement deductibles can vary. Learn more about 2023 Medicare deductibles and other Medicare costs.
There are several different types of Medicare insurance plans or parts, and each part of Medicare may contain its own deductible. Below is an overview of Medicare yearly deductibles including how much they are and how they work.
- Medicare Part A deductible
- Medicare Part B deductible
- Medicare Advantage (Part C) deductibles
- Medicare Part D prescription drug plan deductibles
- Medicare Supplement (Medigap) deductibles by plan
What Is a Deductible?
A deductible is the amount of money that you must pay out of your own pocket for covered care before your plan coverage kicks in.
For example, if your Medicare plan has a $200 annual deductible, you must pay for the first $200 worth of covered services or items yourself. Once you have satisfied the deductible, your Medicare plan then begins to pick up a share of the cost for remaining covered care for the rest of the year.
Below is a look at the deductible for each part of Medicare including how much each deductible within Medicare costs in 2023 and how it works.
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What is the Medicare Part A Deductible?
Medicare Part A covers inpatient care received at a hospital, skilled nursing facility or other inpatient facility.
The Part A deductible is unique in that instead of operating on an annual basis like other Medicare deductibles, it operates on a “benefit period” basis. A benefit period begins the day you are admitted to a facility as an inpatient and ends when you have gone 60 consecutive days without receiving any inpatient care.
You could experience multiple benefit periods within the same calendar year if you are in and out of the hospital multiple times, and you would be required to meet the full deductible cost in each new benefit period.
In 2023, the Medicare Part A deductible is $1,600 per benefit period. That means when you are admitted to a hospital or other medical facility as an inpatient in 2023, you are responsible for paying the first $1,600 of covered care before Medicare Part A begins picking up any costs.
Should you enter the hospital again at least 60 days after your benefit period has ended, you will begin a new benefit period and will once again have to pay the first $1,600 of covered care.
In some cases, people opt for Medicare Advantage Plans instead of Original Medicare (Medicare Part A and Part B). In this case, the Medicare Advantage plan (also called Medicare Part C) is required to cover at minimum all the things that would be covered by both Parts A and B.
What Is the Medicare Plan B Deductible for 2023?
The deductible for Medicare Part B is $266 per year in 2023 ($233 in 2022).
Medicare Part B provides coverage for outpatient care such as doctor’s appointments, outpatient surgeries, procedures performed in outpatient facilities, rehabilitation care, preventive medicine, durable medical equipment (such as wheelchairs and walkers) and more.
Here's an example of how the Medicare Part B deductible might work in 2023:
- You go to the doctor in January, and the allowed charge is $160. You would be responsible for paying that amount and would have $106 remaining before meeting your annual Part B deductible.
- In March, you go to the doctor again, and the allowed charge is $150. You would be responsible for paying the first $106, which would meet your deductible. There is still $44 remaining on the bill, for which you would be responsible for the Part B copayment or coinsurance, which is typically 20% of the allowed amount (in this case, 20% of $44).
For the remainder of the year, you would be responsible for the copay on allowed charges billed to your Medicare Part B coverage.
The Medicare copay for most services under Part B is 20%. So, imagine you had $2,000 in covered medical charges in 2023 that were subject to Part B copay costs. You would be responsible for:
- The $266 deductible
- 20% of the remaining $1,734, which is $346.80
That's a total out-of-pocket responsibility of $612.80
This is a simplified look at the process, but it gives you an idea of how the Part B deductible works. Some people can purchase supplemental insurance or have secondary coverage, such as Medicaid, which helps cover the 20% co-pay. In some cases, these secondary coverages may also help cover the Part B deductible.
Some Medicare Supplement Insurance (Medigap) plans cover the Part B deductible or the Part A deductible.
What Is the Cost of Medicare Part B Premium for 2023?
Medicare Part B does come with a premium cost. The Medicare monthly premium prices are set annually and depend on your annual income. So, how much is the Medicare premium? In 2023, premiums start at $164.90 per month. The maximum cost of Medicare Part B premiums is $560.50 per month in 2023, and that's for individuals reporting half a million dollars or more in income in 2020.
Medicare Part C (Medicare Advantage) Deductibles
Medicare Part C plans, otherwise known as Medicare Advantage plans, are an alternative way to get Original Medicare benefits, often with additional coverage. Medicare Advantage plans are required by law to cover everything found in Medicare Part A and Part B, and many Medicare Advantage plans may typically include benefits not covered by Original Medicare such as dental, vision, hearing, prescription drugs and more.
Medicare Advantage plans are sold by private insurance companies and don’t have a standard deductible. There are thousands of different Medicare Advantage plans sold by dozens of insurance companies, and each carrier is free to set their own deductibles for each of their plans.
Medicare Advantage deductibles can range from $0 to several thousand dollars. Medicare Advantage plans that include prescription drug coverage will often have two separate deductibles, one for medical care and another for prescription drug costs.
Medicare Part D Deductible
Medicare Part D plans cover prescription medications. Like Medicare Advantage, plans Medicare Part D plans are sold by private insurers and thus there is no standard deductible.
Some Part D plans have $0 deductibles, but average Part D deductibles hover around $367 per year in 2022 ($505 in 2023).
Medicare Supplement Deductibles by Plan
There are 10 standardized Medicare Supplement plans (also called Medigap) available in most states, and two of those plans offer a high-deductible option. Medigap Plan F and Plan G have high-deductible options that include an annual deductible of $2,490 in 2022. Plan members must meet this deductible before the plan begins to cover any of Medicare out-of-pocket expenses.
Medicare Supplement Insurance plans are sold by private insurance companies. These plans help pay for Original Medicare deductibles and other out-of-pocket Medicare expenses like copayments and coinsurance.
Six types of Medigap plans provide full coverage of the Medicare Part A deductible, and another three plans provide partial coverage of the Part A deductible.
Two plans, Plan F and Plan C, provide full coverage of the Medicare Part B deductible, although these plans are only available to beneficiaries who became eligible for Medicare before Jan. 1, 2020. If you were eligible for Medicare before 2020, you may still be able to apply for Plan F or Plan C if they’re available where you live. If you already have either plan, you can keep your plan as long as you continue to pay your plan premiums.