While Part A provides coverage for hospital, in-home, and institutional services, Part B primarily deals with doctor’s services and preventative care.
Part B– What does it cover?
Medicare Part B is designed to provide the following services:
- Preventative Care: Part B coverage incentivizes you to stay healthy by covering the following preventative services:
- Annual wellness exams
- Many types of preventative screening exams such as mammograms and colonoscopies
- Flu shots
- Smoking and obesity counseling
- Medical Services: In the event that health care is needed, Part B will step in and provide for the following:
- Medically necessary doctor’s visits (even while staying in the hospital, covered under Part A)
- Approved procedures such as x-rays, casts, stiches, or outpatient surgeries
- Home health services
- Durable medical equipment
- Ambulance services when other transportation options would risk your health
Part B – What does it cost?
Unlike Part A, which is free to most seniors, Part B does come with a monthly premium cost.
The base monthly premium for 2019 is $135.50/month per person. If you are collecting Social Security this amount will be automatically deducted from your monthly benefit. If you are delaying Social Security benefits then you’ll receive a bill in the mail with various payment methods available.
There is also a potential additional monthly premium surcharge, knowns as the income-related monthly adjustment amount (IRMAA), that is applied on top of the $135.50. This adjustment is based on the modified adjusted gross income reported on your IRS tax return from 2 years ago:
On top of the monthly premiums (and relevant adjustments listed above) there is also an annual deductible of $185 in 2019.
Once your deductible is met, you will also pay 20% of the Medicare-approved amount for doctor services, outpatient therapy, and durable medical equipment.
Note: You will want to have ample retirement resources available for coinsurance and deductibles under Medicare Part A and B in retirement. This is a very important part of the retirement planning process and a key deliverable of a knowledgeable advisor.
What is NOT Covered Under Medicare Part A and B?
Medicare doesn’t cover everything. If you need certain services that aren’t covered under Medicare Part A or Part B, you’ll have to pay for them yourself unless:
- You have other coverage (including Medicaid) to cover the costs
- You’re in a Medicare Advantage Plan that covers these services (we will discuss Medicare Advantage plans in our next post)
Some of the items and services that Medicare Part A and B do not cover include:
- Most dental care
- Eye exams related to prescribing glasses
- Cosmetic surgery
- Massage therapy
- Routine physical exams.
- Hearing aids and exams for fitting them
- Long-term care.
This wraps up our summary of Medicare Part B. Remember, an important consideration of a comprehensive retirement plan is accounting for the various parts of Medicare and what they mean for your out-of-pocket costs.
To learn more about Medicare and the specifics, the government has a great resource that it publishes annually, titled Medicare & You that reviews the Medicare system and coverages in greater detail.