The Centers for Medicare and Medicaid Services (CMS) announced that it is increasing premium and deductible costs in the Original Medicare program. Healthcare costs rise more each year, and to make up these costs, premiums, and deductibles for Medicare increase. Medicare deductibles, premiums, and coinsurance costs are adjusted annually.
Medicare Deductibles and Premiums Changes Explained
Medicare Deductibles for Part A
Medicare Part A is the part of Medicare that pays for hospitalization, nursing home, and some home healthcare costs. Medicare Part A beneficiaries will pay an inpatient hospital deductible of $1,484 when they’re admitted to the hospital, up from $1,408 last year. This amount covers the first 60 days of a Medicare-covered inpatient hospital stay, after which a patient will pay a daily coinsurance of $371 per day for days 61 to 90 and $742 per day for lifetime reserve days. Beneficiaries in skilled nursing facilities will pay $185.50 per day in coinsurance for days 21 to 100.
Medicare Deductibles for Part B
Medicare Part B covers physician fees, outpatient services, some home health services, medical equipment, and some medications. This year, the annual Medicare Part B medical insurance deductible increased from $198 in 2020 to $203 in 2021. After meeting your deductible, you’ll pay 20% coinsurance for the Medicare-approved cost of most doctor services, outpatient therapy, and durable medical equipment.
Medicare Advantage
The cost of Medicare Advantage deductibles varies based on the plan a beneficiary chooses and the zip code in which they live.
Medicare Deductibles for Part D
Medicare Part D is known as the prescription drug plan for Medicare. Yearly deductibles for Medicare Part D prescription drug plan varies by provider, and some policies don’t charge a deductible at all. Still, no drug plan can charge more than $445 in 2021, up from $435 last year.
Medigap
Most Medigap policies typically don’t have their own deductible. However, Plan F, Plan G, and Plan J (all high-deductible options) will have a $2,370 annual deductible.
COVID-19 Vaccines
CMS adjusted coverage to allow comprehensive, affordable coverage due to the coronavirus (COVID-19). Medicare would cover 100% of the cost of COVID-19 vaccines approved by the Food and Drug Administration. There is no need to pay a deductible or coinsurance for vaccine administration. Medicare Part B, Medicare Part D, and Medicare Advantage plans all cover vaccines at no additional cost. Currently, coverage includes:
- Testing for coronavirus with no out-of-pocket costs
- All medically necessary hospitalizations related to coronavirus
- A vaccine for coronavirus, should one become available (covered by all Medicare Part D plans)
- Medicare expansion of telehealth services and virtual visits to increase access and meet patient needs due to the Public Health Emergency created by COVID-19
- Waiver of the requirement that patients have a 3-day hospital stay before entering a nursing home to clear hospital resources for more critically ill patients
Keeping a close eye on such policy changes is crucial for the financial sustainability of your practice. You can outsource your medical billing to us. We are having a team of HIPAA-compliant experts with a clean claim submission rate of 98%. Get in touch with us!
FAQs
1. Why are Medicare premiums and deductibles increasing?
Costs rise annually to offset growing healthcare expenses, leading to adjusted premiums, deductibles, and coinsurance rates.
2. What is the Medicare Part A deductible for 2021?
Medicare Part A inpatient hospital deductible is $1,484, covering the first 60 days of a hospital stay.
3. What does Medicare Part B cover, and what are its costs?
Part B covers physician fees, outpatient services, and medical equipment. The annual deductible is $203, with a 20% coinsurance after that.
4. Are COVID-19 vaccines and related services covered under Medicare?
Yes, Medicare covers COVID-19 vaccines, testing, and hospitalizations at no cost, with expanded telehealth services.
5. How can outsourcing medical billing help with Medicare compliance?
Our HIPAA-compliant team ensures accurate claim submissions with a 98% clean rate, helping practices stay compliant and financially sustainable.
