For most people, there is no premium for Medicare Part A if they have worked 10 or more years and paid into Social Security. There are other out-of-pocket costs associated with Medicare Part A and Part B.
Medicare Part B Costs
Medicare Part B helps pay for health care services such as doctor services, preventive benefits, hospital outpatient surgery and care, ambulance services, outpatient mental health services, durable medical equipment, and home health care (not covered by Part A).
Part B Out-of-Pocket Costs in 2021
|Part B Premium||$148.50 monthly for most people|
|Part B Deductible||$203 annually|
|Part B Coinsurance||20% of service costs, deductible must be paid first|
Doctors or other providers who accept assignment agree to accept the amount that Medicare will pay for a visit or service (called the Medicare-approved amount) as payment in full. This helps to reduce out-of-pocket costs.
Providers who see Medicare beneficiaries but do not accept assignments can charge up to 15% more than the Medicare-approved amount. Out-of-pocket costs could be the standard 20% coinsurance plus up to an extra 15%.
For example, if the Medicare-approved amount for a doctor visit was $100, but a doctor did not accept the assignment, they could charge up to $115 for the visit. Out-of-pocket costs could be $35 (20% of the $100 Medicare-approved amount, plus the extra $15 not covered by Medicare).
Part A Costs
Part A Part A is often called hospital insurance because it pays for care while admitted at the hospital. It also pays some costs outside a hospital, such as skilled nursing facility stays, home health care, and hospice care.
Most Medicare recipients do not owe a monthly premium for Medicare Part A because they (or their spouse) paid it while working. Beneficiaries that did not work long enough can buy Part A.
What You Will Pay for Monthly Premiums in 2021
|Time Worked*||Premium Cost|
|For 10 or more years||$0|
|Between 7.5 and 10 years||$ 259|
|For fewer than 7.5 years||$471|
*If you or your spouse worked and paid into Social Security
What You Will Pay for a Hospital Stay in 2021
|Length of Stay||What You Pay|
|Days 61-90||$371 per day|
|Days 91-150*||$742 per day|
*These are called "lifetime reserve days" because Medicare will only pay for these extra days once in your lifetime.
What You Will Pay for a Skilled Nursing Facility Stay in 2021
|Length of Stay||What You Pay|
|Days 21-100||$185.50 per day|
|After 100 days||All costs|
There is no deductible or copayment for hospice care, only minimal costs for medications and inpatient respite care.
Home Health Care
There is no deductible or copayment for home health care, as long as the beneficiary meets the eligibility criteria for coverage.
Providers can also “opt-out” of the Medicare program. That means that they can charge any amount for a service and will not bill Medicare. If a provider has opted out of Medicare the full costs of the service must be paid out-of-pocket, Medicare will not cover any of the costs. Providers that opt-out of Medicare should have signed contracts from beneficiaries stating they consent to pay the full cost of services.