Original Medicare Part B Overview: Coverage, Costs & Exclusions
Getting the healthcare, you need when you retire is essential to your quality of life and overall well-being. Even if you’re healthy, any potential medical problem can make a considerable cut into your retirement savings. It is vital to enroll in Medicare Part A and Medicare Part B to make sure you have proper health insurance to cover you in any situation.
What exactly is it? What kind of procedures or coverage can I get with it? You, like many others, may consider Medicare as medical coverage. It covers a lot of your inpatient and outpatient needs when it comes to the hospital. To make it simpler, consider it the coverage and care administered by a physician.
Medicare Part B is part of the “Original Medicare” that was started decades ago to help those 65 or older get the medical care and preventative services they needed. It covers 80% of your costs like:
- Any medical services that are required or supplies are used to diagnose or treat your medical condition.
- Your preventative services like health care that is used to deter any illness or detect it while its in its early stages.
What Does Medicare Part B Cover?
Coverage is typically classified as outpatient services. These services can occur both outside of the hospital, as well as some services inside of the hospital. However it does not cover ALL medical expenses.
What is Covered?
- Doctor Visits
- Outpatient Care
- Home Health Care
- Durable Medical Equipment
- Preventative Care
What is NOT Covered?
- Inpatient Services
- Dental, Vision, and Hearing
- Hospice Care
- Prescription Drugs
- Long Term Care
- Cosmetic Surgery
Further, coverage is broken down into two categories: medically necessary services and preventative services.
Medically Necessary Services:
Essentially, medically necessary doctor services cover the procedures and equipment that are needed for the diagnosis and treatment of a medical condition. With these services you generally have a cost-share portion, which will be discussed in detail later.
This part of Medicare will also cover any services at the hospital that may occur while you’re there. This may include radiation and chemotherapy for any cancer, diagnostic imaging, physician services, surgeries, medical equipment used in your treatment, and dialysis if your kidneys fail. While you’re in any type of clinical setting, this part of Medicare will pay for any of the drugs that were administered to you during this time.
The other half of Medicare Part B coverage involves preventive services. This includes but isn’t limited to procedures like mammograms, colonoscopies, and flu shots. It is also coverage for your regular outpatient needs like lab testing, doctor’s visits, ambulance rides, care while you’re at home, and chiropractic care, to name a few. Dependent on the preventative service, many are covered at 100% coverage, with no cost-share to you. It is important to discuss your service and possible cost-share with your physician prior to any procedures.
Most drugs will be covered by Medicare Part D or any supplement plans you may have outside of Part B.
Unlike Part A of Medicare, you only want to enroll in Medicare part B if you plan to use Medicare as your primary source of healthcare coverage. If you plan to get a Medigap coverage to supplement your Medicare coverage, you will need Part B.
Will Medicare Part B Cover all My Outpatient Needs?
As long as a procedure is medically necessary, it will usually be covered. If a physician documents that you are in need of a specific procedure, then Part B will usually cover it. Medicare may require additional documentation if they disagree with your doctor. Remember, you’re still working with an insurance-style provider, so you may have to jump through a hoop or two to get them to pay for it. Speak with your doctor about the extra paperwork needed, and they’ll help you out.
What are the Costs?
After you pay the annual deductible, it will cover the first 80% of all approved costs.
How Much of a Premium Will I be Responsible?
To get the most out of your Medicare benefits, you will be responsible for paying a monthly premium. However, many Americans will only have to pay the regular amount the government sets. As of 2024, $174.70 is the monthly base rate of Medicare Part B. This is for those new to enrolling in Medicare. If, for some reason, you have a monthly income that is within a certain bracket, you may owe more.
For some extra information, visit the Medicare costs at a glance page to see the chart that will show you the prices and how they fit in with your current income bracket. Remember, be sure you don’t enroll late or you’ll be subject to paying a hefty penalty. This is crucial, so you don’t want to miss your window of enrollment when you retire as you may lose your employer health insurance.
If you’re already enrolled in Social Security benefits, premiums will be deducted from your check from social security. If this doesn’t happen, you’ll be billed every quarter. There is also an option of paying by credit card. Its located at the bottom part of the payment section. All you will need to do is fill out the information and put it in the mail addressed to the Medicare Premium Collection Center.
To make it easy and also help you, so you don’t forget, there is an option to use the Medicare Easy Pay. We all forget things from time to time, and this free auto-draft service will automatically withdraw the payment for the premium from your bank account. You can choose either savings or checking account.
How Do You Sign Up?
If you’re already taking advantage of your Social Security benefit at age 65, then you won’t have to enroll in Part B. You’ll be automatically registered by the Social Security Office. Remember that your card will arrive in the mail at least 1-2 months before you turn 65 years old. You don’t want to miss it.
If you aren’t taking advantage of your Social Security benefits, then you will have to enroll yourself by age 65. It can easily be done online, in person at the Social Security office, or over the phone to save you a trip. For your card to arrive, it’ll take a few weeks to come after you apply for your benefits. Plan ahead by applying a few weeks or more beforehand and before you need the coverage.
It is easy to sign up for. It’s vital that you sign up during your initial enrollment period unless you have other coverage that can take its place. If not, you’ll have a penalty to pay, which can dip into your retirement.
What Does it not Cover?
When it comes to hospital expenses, it won’t cover room and board” while you are hospitalized as an inpatient. This means that Medicare Part A does. Also, any cosmetic procedures won’t be covered along with dental, hearing or vision, and routine foot care. Part B doesn’t cover the prescription drugs you will need to pick up at a retail pharmacy or through mail-order. For covered in your prescription drugs, it’s recommended that you consider Medicare Part D.
It won’t generally cover things that are considered unreasonable and unnecessary. Your physician will know what will be or won’t be covered. Feel free to ask questions, so you have all the information needed.
Does Medicare Part B have Cost-Sharing Like Medicare Part A?
Yes, it does. You will pay a certain percentage of any medically necessary costs. These costs are as follows:
- $240 annual deductible.
- You’ll be subject to pay 20% of any remaining costs, and there are no limits or caps.
- Beyond what Medicare covers, you’ll have to pay any of these excess charges that the facility or provider charges.
The most significant part of is the 20% that you’ll be liable for when it comes to your outpatient care. If you need services like chemotherapy or even surgery, these expenses can become too high to pay. In your retirement, you shouldn’t have to worry about being subject to these astronomical expenses when there is coverage that will supplement your Medicare that’ll fit within your budget.
What is the Late Enrollment Penalty?
If you didn’t have any credible insurance and didn’t sign up for Medicare at your first eligibility, then you’ll be responsible for the late enrollment penalty. This is a 10% penalty annually for every year that you waited to enroll. This penalty will be applied to the standard Part B premium. Currently, it is $174.70 for 2024.
When you get the chance to enroll, you will need to wait for Medicare’s enrollment period to sign up for Part B of the plan. The period is at the beginning of the year, January through March every year. In July, your benefits will start. While the benefits starting can be a great thing, you’ll still have to wait for a few months for the coverage to start and have the penalty to pay.
If you enrolled late, but it was due to your employer group health plan from a company with 20+ employees, you won’t have to worry about the late enrollment penalty. After that coverage ends, you will have eight months’ time to sign up. This timeframe is your Medicare Special Enrollment Period.
To avoid this penalty due to late enrollment is easy. The only thing you’ll need to do is enroll within the initial period of enrollment. If you’re a little tech-savvy, you can set up an alert on your smartphone to remind you or have a trusted friend or family member to do the same. This will save you money in the end and get your healthcare started so that you won’t get caught with any unnecessary medical bills.
Getting Help with Your Cost
Medical spending can get out of hand fast. Protecting yourself is essential for your continued financial safety. There are only a couple of ways to get help, so you don’t get caught off guard.
- For the services and parts the Medicare Parts A and B don’t cover, there are Medicare supplements with affordable premiums that’ll fit in your budget.
- If you want to get your Medicare A and B benefits through a private health insurance carrier, then you could consider Medicare Advantage or Medicare Part C. It does, however, have a small network than Medicare.
Your retirement should be a time of relaxation, vacations, and less worrying. Having a financial burden because of a lack of healthcare is not one you should have to carry. Medicare Parts A and B are beneficial to you and help cover many of your medical costs. Enrolling in Medicare Part B will help relieve a lot of the financial burden that can come from any outpatient services that you may need.