Next Avenue: How to keep your Medicare costs down

by | Oct 27, 2022 | Stock Market

This article is reprinted by permission from NextAvenue.org. Medicare is not free, and not all Medicare plans offer the same coverage or charge the same amount. Now, during Medicare’s annual “open enrollment period” from Oct. 15 to Dec. 7, is the time of year to compare your plan with the alternatives available in your state.

If you are 65 or over, you can join, switch, or drop a plan without a penalty during open enrollment. Be aware that what you do or do not do will affect the healthcare coverage you will get and the costs you will pay throughout 2023. It is no small matter. A recent study published by the Center for Retirement Research, which is affiliated with Boston College, concluded that retirees pay from 12% to 37% of their income on health insurance premiums, deductibles, coinsurance, copayments and other medical costs.The ABCs of Medicare To understand Medicare, you first need to know about the different parts and what you pay for in retirement. At age 65, Part A, which covers hospital costs, is “free” if you have earned it through 40 credits of qualified work. This covers hospital stays, surgeries, and long-term skilled nursing care. Part B, which covers certain doctors, outpatient care and preventive care, comes with a fee. The monthly premium will be $164.90 a month in 2023, down from $170.10 in 2022. There are also deductibles and other out-of-pocket expenses. The other parts of Medicare are run by private insurance companies according to rules set by the Centers for Medicare and Medicaid Services, a federal agency.Private options Part D is prescription drug coverage offered by private companies following Medicare’s rules. Plan D premiums, which averaged $33.37 a month in 2022, cover some costs of medicine but also have a deductible and often a copay. Supplemental policies, often referred to as Medigap insurance, help to pay Medicare copayments, coinsurance, deductibles and other out-of-pocket expenses. You pick which private insurance company to use based on what you want covered and what you can afford. Medicare Advantage, previously called Part C, includes all the benefits and services of Parts A, B and D bundl …

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