Important Medicare Changes for 2021
Every new year, Medicare benefits costs and availability undergo several changes, and 2021 is no different. Here is what you can expect to change.
Healthcare costs increase each new year, so it’s no surprise that premiums and deductibles for Medicare rise to keep up the pace. Although Medicare costs may increase by only a few dollars, over time this adds up.
It’s crucial for beneficiaries of Medicare, especially seniors, to keep up with these recent developments. Beneficiaries need to understand how these fresh changes will impact their coverage choices and wallet.
Below, you’ll find all the information you need to know about Medicare changes in 2021.
Changes for Medicare Part A 2021
Medicare Part A covers hospital, nursing home, and inpatient services costs. Most seniors rarely pay for Medicare Part A since they prepaid for their coverage during their working years.
However, those who pay should know that the costs for premiums have increased in 2021. Individuals who worked for 30 to 39 years in their lifetime will now have to pay $259 monthly, a $7 rise from 2020. Those who worked 30 years and less in their lifetime will now pay up to $471 monthly, a $13 increase from 2020.
Medicare Part A deductible has also increased in 2021. It’s now $1,484, up to $76 from 2020. The Medicare Part A deductible covers the period a person is admitted to a hospital or care facility and lasts for 60 consecutive days. Since the deductible is paid per period, you might end up paying more than one deductible per year in case of multiple hospital stays.
If you’re admitted for only 60 days, you won’t pay any coinsurance. But when the care requires 61 to 91 days, you will pay a coinsurance of $371 for each day, a $19 increase from 2020.
Medicare Part A also covers patients admitted to skilled nursing facilities. You’ll pay nothing if you stay for 20 days. But, past 21 days, you’ll owe $185.50, a $9.50 increase from $179 in 2020. Deductible and coinsurance rates get rested when patients are out of the hospital or nursing home for 60 consecutive days.
Changes for Medical Part B 2021
Medicare Part B covers your doctor visits, medical supplies, home health services, medical insurance, and more.
In 2021, Part B costs premiums and deductibles increased by 7%. We can link this increase to the increasing cost of medications administered by health professionals. Part B premium cost in 2021 increased by $3.90 to $148.50 per month. This applies to people who earn less than $88,000 yearly or couples with a yearly income of less than $176,000. Keep in mind premium costs depend on your income. The Part B deductible also increased to $203 in 2021 from $193 in 2020.
Changes for Medicare Part D 2021
Medicare Part D offers coverage for prescription drugs. However, Part D costs differ from one provider to another, and premium costs depend on a person’s income.
Although Part D deductible in 2021 varies depending on the plan an individual selects, the maximum Part D deductible in 2021 is $445. That’s a $10 increase from 2020. The maximum amount of money you must pay out-of-pocket before your catastrophic coverage kicks in increased too. In 2021, the out-of-pocket threshold has increased to $6,550 from $6,350 in 2019.
Changes for Medicare Supplement (Medigap) 2021
Medigap covers a portion of your Medicare costs. The plan helps to offset deductibles and premiums costs for Medicare coverage. Nevertheless, the rates of the plans vary depending on the private companies selling them.
Under Plan G for 2021, Medicare offsets its share of the costs, and then patients pay out-of-pocket until they reached a deductible threshold of $2,370. From that point, Plan G will kick and cover the remaining costs.
Other Changes in 2021
There will also be an update to income brackets for Medicare in 2021. Introduced in 2017, income brackets were set at $85,000 and $175,000 for individuals and couples, respectively. But in 2021, the threshold increased to $88,000 for individuals and $176,000 for couples.
In conclusion, Medicare costs increase every year. While changes in Medicare costs might only be a few dollars, they eventually add up over time. This is unfortunate for beneficiaries on a fixed income.
Medicare rates changes for 2022 are yet to be announced. But based on past trends, it’s wise to plan for a slight rise in Medicare Parts A, B, and D costs.