Medicare Part B Deductible: What and How Much Is It?
- Discover more about the Medicare Part B deductible and how it impacts how much qualifying Medicare Part B beneficiaries might pay out of pocket for services.
Many older adults have Medicare. If you have regular Medicare Part A coverage, you may also qualify for Medicare Part B coverage. This supplemental coverage does come with a potential monthly premium and an annual deductible. Find out more about the Medicare Part B deductible and other costs associated with this coverage below.
What Is Medicare Part B?
Medicare Part B is one element of Medicare health care coverage. Part A is what covers expenses related to inpatient hospital stays, skilled nursing home care, home health and hospice.
Medicare Part B, on the other hand, covers medically necessary services required to treat conditions, including some labs, doctors visits and medical equipment. It also covers preventative services such as flu vaccines.
In some cases, people opt for Medicare Advantage Plans instead of traditional Medicare A and B. In this case, the Medicare Advantage Plan is supposed to cover at minimum all the things that would be covered by both Parts A and B.
How Does the Medicare Part B Deductible Work?
Medicare Part B does come with a deductible, and it works just like a deductible with any other type of health care coverage. You must pay medical expenses out of pocket until you meet the deductible. After that, you would pay the coinsurance amount for covered treatment.
What Is the Medicare Part B Deductible for 2021?
The Medicare Part B deductible is adjusted periodically. For 2021, the deductible is $203 per year.
Here's an example of how the Medicare Part B deductible might work in 2021:
- You go to the doctor in January, and the allowed charge is $160. You would be responsible for that amount.
- In March, you go to the doctor again, and the allowed charge is $150. You've met $160 of your $203 deductible, which means you would be responsible for another $43.
- After that, you would only be responsible for the co-pay on allowed charges billed to your Medicare Part B coverage.
The copay for most services under Medicare Part B is 20%. So, imagine you had $2,000 in covered medical charges in 2021. You would be responsible for:
- The $203 deductible
- 20% of the remaining $1,797, which is $359.40
- That's a total out-of-pocket responsibility of $562.40
This is a simplified look at the process, but it gives you an idea of how the deductible works. Some people are able to 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.
What Is the Maximum Cost of Medicare Part B?
Medicare Part B does come with a premium cost. The monthly premium prices are set annually and depend on your annual income. Premium costs start at $148.50 per month. The maximum cost of Medicare Part B coverage is $504.90 per month in 2021, and that's for individuals reporting half a million dollars or more in income in 2019.