Many refer to Medicare as “alphabet soup”, and Part B is one letter of this. Medicare Part B is one part of Original Medicare, which is made up of Part A and B. While Part A is hospital insurance, Part B is medical insurance, covering doctor and outpatient costs.  

What does Medicare Part B Cover?

Medicare Part B covers medical services and supplies that are medically necessary. This includes outpatient care, preventative services, ambulance services, mental health services, physical therapy, etc. For a full list of services covered under Part B, look to the Medicare handbook “Medicare and You”.

If you decided to opt-out of Original Medicare and go into a Medicare Part C Medicare Advantage plan, you will not get your Part B coverage through Medicare, but through a private company. By law, these Medicare Advantage Plans must offer at least the same level of coverage as Original Medicare, so all the services and supplies listed above will be covered, you might just have to go to specific doctors or hospitals to get it.

Who is eligible for Medicare Part B?

Anyone eligible for Part A is eligible for Part B. To be eligible for Part A, an individual must be entitled to Medicare based on their own earning record or that of a spouse, parent, or child. This requires working and paying Medicare payroll tax for at least 40 quarters, or 10 years. In many cases, if you are already receiving Social Security Benefits, you will automatically get Part A and Part B coverage the first day of the month you turn 65. If you are not automatically enrolled, you must enroll during your Initial Enrollment Period.

You may also qualify for Medicare Part B if you are receiving Social Security disability benefits. If you are under 65, you will automatically be enrolled in Parts A and B after 24 months of disability.  

If you have ALS or end-stage renal disease, you may also be eligible for Medicare Part B.

Enrolling in Medicare Part B

As mentioned above, if you are already taking Social Security benefits,  you are automatically enrolled in Medicare Part A and Part B.  If not automatically enrolled, you must enroll during your Initial Enrollment Period,which is the 3 months before and the 3 months after your birth month, as well as your birth month, totaling 7 months.  

There are also Special Enrollment Periods, which are triggered when events, such as losing work coverage, occur. Since you have to pay a premium for Part B, you are not penalized for not signing up when you have other creditable coverage. You must sign up within 8 months of losing coverage to not receive any penalties.

The Annual General Enrollment Period, which lasts from January 1st – March 31st, is when you can sign up if you did not sign up during your Initial Enrollment Period or a Special Enrollment Period. If you sign up during this time, coverage will not start until July 1st. You usually have to pay a late enrollment penalty for not signing up when you were first eligible.

It is important to remember that once you sign up for Part B, your 6 month Open Enrollment Period for Medicare Supplements starts. This period is when you can sign up for a Medicare Supplement without any health questions, which guarantees you get the best coverage for the best price. Make sure to compare companies when shopping for a supplement: the plans are standardized – the only thing that varies between them is the price.

How much does Medicare Part B cost?  

Medicare Part B does have a premium, which can change every year. Currently it is $134 a month. This price is regularly only paid by new enrollees to Medicare  due to Social Security’s “hold harmless” provision. This provision states that Medicare Part B premiums cannot be raised higher than Social Security’s Cost of Living Adjustment each year, resulting in about a quarter of Medicare beneficiaries not paying the full $134.  High earners pay more than $134 due to IRMAA, or the Income Related Monthly Adjustment Amount.

The annual deductible for Medicare Part B is $183 in 2018. Only one Medicare Supplement plan covers this, which is Plan F. Otherwise, most Medicare beneficiaries pay this themselves.

Medicare beneficiaries are also responsible for 20% coinsurance for most covered services as Medicare only covers 80%. Medicare Supplements are there to fill this gap. Medicare supplement prices vary by plan, age, gender, location, and smoking status. You can compare Medicare Supplement prices in your area without giving away any personal information on Cardinals site.

Medicare Part B is only one piece of the Medicare puzzle. To learn more about the other parts of the puzzle, go here or call Cardinal Advisors at 919-535-8261.