How Do the Original Medicare and Medicare Advantage Costs Work?

In Original Medicare, you will be charged for standardized Part A and Part B costs. In 2020, these costs include:

  • Part A premium: The Part A premium may be different depending on your work history. If you or your spouse has worked more than 10 years, you will generally not have to pay a Part A premium. If you have worked between 7.5 and 10 years, your Part A premium will be $252/month. If you have worked less than 7.5 years, your Part A premium will be $458/month.
  • Part B premium: The Part B premium is $144.60 for people with a yearly income below $87,000 ($174,000 for a married couple). If your income is higher than that, you may have to pay an income-related monthly adjustment amount (IRMAA), which is an amount you pay in addition to your Part B premium if your income is over a certain level.
  • Part A deductible and coinsurance:
    • The hospital deductible (the amount you have to pay before Medicare begins covering your costs) is $1,408.
    • The hospital coinsurance is $0/day for days 1-60 of a hospital stay after meeting your deductible. The coinsurance is $352/day for days 61-90 and $704/day for days 91-150.
    • The skilled nursing facility (SNF) coinsurance is $0 for the first 20 days after a qualifying inpatient hospital stay, and the coinsurance for days 21-100 is $176/day.
  • Part B deductible and coinsurance: In Original Medicare, you will pay a Part B deductible of $198 in 2020. There is a coinsurance of 20% for most services that are covered by Part B.
    Keep in mind that if you have a Medigap, you will be responsible for fewer out-of-pocket costs.

Keep in mind that if you have a Medigap, you will be responsible for fewer out-of-pocket costs.

If you have a Medicare Advantage Plan, you will be responsible for paying:

  • Part A premium, if you have one (see above).
  • Part B premium (see above).
  • A Medicare Advantage Plan premium, in many plans. The amount of this premium can vary widely.
  •  Medicare Advantage Plan deductible: Your Medicare Advantage Plan might have a deductible—an amount you are responsible for paying out of pocket before your plan will begin to cover your services.
  • Copayments and coinsurances: The cost-sharing for Medicare Advantage-covered services can vary from plan. Contact your plan to learn more about the cost-sharing you’ll be responsible for.

If you have a Medicare Advantage Plan, your plan has an out-of-pocket limit. This is the maximum amount that you can be required to pay out of pocket for covered services. This amount does not include your Part A or B premiums or your Medicare Advantage Plan monthly premium. Plans can have different out-of-pocket limits, but in 2020, the maximum out-of-pocket limit is $6,700 for in-network services and $10,000 for out-of-network services.

Read More: Do I Have to See Specific Providers When I Have Original Medicare vs. Medicare Advantage?
Learn About: What is Considered a Supplemental Benefit?
Return to: Medicare Advantage

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