Updated August 1,
2019 Marc A. Figlar, CSA
Marc has been an insurance advisor for
over 15 years, specializing in working with individuals and small business
owners to create an effective strategy for navigating the Medicare maze.
Medicare Part B is
one of the two parts of Original Medicare. Original Medicare is managed by the
Federal Government and is considered a fee-for-service healthcare plan, where
you pay a percentage of the costs for healthcare services you utilize.
Medicare Part B is
frequently referred to as the “medical insurance” portion of Original Medicare.
It can help cover doctors’ services, preventive care, medical devices, hospital
outpatient care, home health care, and more.
The other part of
Original Medicare is called Medicare
Part A. Part A is frequently referred to as the “hospital insurance”
portion of Original Medicare. It helps cover inpatient care costs when you are
in a hospital or skilled nursing facility that accepts Medicare.
Note: Unlike Medicare Part
A, it may make sense to delay your enrollment in Part B if you have additional
health coverage through an employer. We’ll cover this in detail below.
Medicare Part B
eligibility
Just like Medicare
Part A, most people are automatically eligible for Medicare Part B when they
turn 65. However, you must be a U.S. citizen or a legal resident who has been
living continuously in the U.S. for at least 5 years.
If you are under 65,
you may also be eligible for Medicare Part B if you have end-stage renal
disease or amyotropic lateral sclerosis (Lou Gehrig’s disease).
Medicare Part B
premiums
The standard Medicare
Part B premium in 2019 is $135.50 per month. However, you may pay more or less
than this amount depending on your income and other factors.
People who
receive Social Security benefits will
pay slightly less, around $130 on average. If you don’t receive Social Security
and your income is over a certain amount, you’ll pay more.
Medicare Part B
deductibles and other costs
A deductible is the
amount you must pay out of pocket before Medicare starts covering your medical
bills. For 2019, the Part B deductible is $185 per year.
After you meet your
deductible, Medicare will start paying 80% of the Medicare-approved amount for
Part B covered health services. You will be responsible for the 20% that is not
covered by Medicare.
This is why many
people get a Medicare Advantage or Medicare Supplement (Medigap) plan. These
supplemental plans can cover most or all of the 20% left over after Medicare
pays.
The most popular
Medigap plan is currently Medigap
Plan F. However, Medigap
Plan G is fast becoming the most popular plan since Plan F is being
taken off the market.
What are Part B
excess charges?
Part
B excess charges are the difference between how much a doctor charges
for a service and how much Medicare has agreed to pay for it.
It is pretty rare to
pay excess charges since most doctors only charge the Medicare-approved amount.
If you do have a doctor who charges more than the Medicare amount, you can find
a Medigap policy that will pay for those excess charges.
How to enroll
If you started to
receive Social Security or Railroad Retirement Board (RRB) benefits at least
three months before your 65th birthday, you do not need to apply for Parts A or
B (Original Medicare). You’ll be auto-enrolled in Original Medicare and should receive
information in the mail explaining your benefits.
If you did not start
your Social Security or RRB benefits at least three months before your 65th
birthday, you’ll need to enroll on your own. You can do this during your Initial
Enrollment Period (IEP), which spans the three months prior to your
65th birthday month, your birthday month, and the three months following your
birthday month. For example, if your birthday is in April, you have from
January 1 to July 31 to enroll.
Enrolling is a
relatively quick process and there are three ways you can do it:
- Online: https://www.ssa.gov/retireonline/
- Over the phone:
800-772-1213
- In person at
your local Social Security office. Look up your office here.
Your first enrollment
period is crucial, as missing this window will almost certainly result in
higher premiums for the rest of your life.
If you are receiving
any other kind of Social Security benefits besides regular retirement benefits
(such as spousal benefits), you should contact your local Social Security
office to see if you will be auto-enrolled in Medicare.
What services are
covered by Medicare Part B?
- Helps cover
doctors’ services, hospital outpatient care, and home health care.
- Helps cover
tests, shots and some preventive services to maintain your health and to
keep certain illnesses from getting worse (flu shots, PAP tests).
What is not covered
by Medicare Part B?
Generally, Part B
won’t cover prescription drugs (with some exceptions), routine foot care,
dental, vision, hearing care, hearing aids, dentures, and acupuncture.
Should I delay
enrolling in Part B?
The monthly premiums
for Medicare Part B can be quite expensive so it may make sense to delay your
enrollment if you are still employed and have creditable
coverage from your employer’s health plan.
If you decide to
delay enrollment and don’t have creditable coverage from your
employer-sponsored health plan, you may pay a late
enrollment penalty once you do enroll in Part B. The penalty can be
fairly large and will continue for the entire time that you are on Medicare.
After your
employer-sponsored coverage ends, you will enter into a Special Enrollment
Period (SEP) that lasts for 8 months. During this 8 month period you will be
able to enroll in Medicare Part B without paying a late enrollment penalty.
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