The world of Medicare can be challenging to navigate. Many seniors receive multiple calls daily from insurance agents trying to sell them a plan, making everything more overwhelming. All the different parts and plans and what they cover are confusing enough, and that’s before the various premiums and deductibles enter the conversation.

It is crucial retirees understand the ins and outs of Medicare, as you could make a grave mistake that leaves you stuck with lousy coverage.

So, what does Medicare cost in 2022? Let’s get into it.

Medicare Part A and Part B

Original Medicare is divided into Parts A and B.

Part A

Part A covers your inpatient hospital stay as well as skilled nursing facility stays and hospice. If you’ve worked and paid Medicare taxes in the U.S. for at least ten years (40 quarters), you qualify for premium-free Part A. Most people qualify for premium-free Part A, but if you have more than 30 quarters but less than 40, you will pay a premium for Part A ($274 for 2022). If you have less than that, the cost for Part A rises to $499 monthly for 2022.

In 2022, Part A also has a deductible of $1,556 per benefit period.

Part B

Part B covers your outpatient services. This part pays for services like doctor visits, surgeries, lab work, and physical therapy. Medicare Part B does have a monthly premium based on a person’s modified adjusted household gross income. Most people pay the minimum amount, which is $170.10 for 2022, but if you made more, you could pay more for your monthly premiums.

Part B also has a yearly deductible ($233 for 2022). After the deductible is satisfied, Medicare will pay 80% for outpatient care and services, leaving you with the remaining 20%. The 20% also has no cap, so if Medicare paid 80% of your $100,000 bill, you would be responsible for the $20,000 left over.

Because of this reason, many seniors opt to get additional coverage to help pay some of their remaining costs.

Medicare Supplements

Medicare Supplements, also known as Medigap plans, are sold by private insurance carriers, but they must follow Medicare’s guidelines. These plans help cover the remaining 20% that beneficiaries are responsible for out of pocket. The coverage for a type of plan is the same whether you enroll through one insurance carrier and your friend chooses another.

There are multiple types of supplements, such as Plan A, B, C, D, F, G, K, L, M, and N. Plan G and Plan N are two of the most popular ones on the market right now due to their comprehensive coverage. Plan G covers all of your out-of-pocket Medicare Part A and Part B costs except the Part B deductible. After the deductible is satisfied, Plan G will pay secondary to Medicare.

Plan N offers similar coverage, but in addition to paying the Part B deductible, you will have copays for doctor appointments and emergency room visits. Plan N also does not cover excess charges, which means if you see a provider that does not accept Medicare assignment, Medicare’s approved rate for a service, then they can charge up to 15% above what Medicare allows. This amount would have to be paid out-of-pocket by you under Plan N.

All in all, the various supplement plans have their advantages and disadvantages. Since Plan G covers more, they also tend to have higher monthly premiums than Plan N. Whichever you pick as secondary coverage comes down to what you think is best for your situation.

One major thing to note is that Medicare Supplements do not have prescription drug coverage, so if you choose a supplement plan, you need to enroll in a Part D plan for your medications.

Medicare Advantage Plans

Medicare Advantage plans, also known as Part C, are Medicare-approved plans you enroll in through private insurance carriers. These insurance plans usually have HMO or PPO networks. These plans function similarly to employer group coverage, where you will have copays and coinsurance whenever you receive care.

Advantage plans tend to have very low or even $0 premiums. Beneficiaries also have a maximum out-of-pocket for medical spending. This amount could be $3900 under some plans and $7,000 under another. The benefits and drawbacks can depend on your health situation and needs.

Many Medicare Advantage plans include prescription drug coverage in their benefits, unlike Medicare Supplements.

Part D

Medicare Part D is your prescription drug coverage. This part is also based on your income, so you may be subject to paying more in monthly premiums if you make more. Many of these plans can be as low as $10 a month, but your plan options will vary by state and zip code. What type of prescriptions you need and how the medications are covered is another reason each person’s plan will differ.

Part D plans get divided into tiers for their medication. Depending on the type of prescription and your drug plan benefits, there are various copays and coinsurance you could be responsible for paying.

So, how much is it?

We wish it could be as simple as stating a number, but it depends on each person’s income, budget, and preferences. If you don’t mind multiple copays and coinsurance, Medicare Advantage plans might be the additional coverage you want. Still, if you don’t mind higher premiums for more comprehensive coverage, a Medicare Supplement could be the right one for you.

If you need help figuring out how to choose a plan, contact a Medicare expert so that they can go over all your options with you and help you make the decision that best suits your needs.