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At the beginning of November 2019, the Centers for Medicare and Medicaid released cost changes for Medicare Parts A and B. These changes will affect monthly premiums, deductibles, and coinsurance amounts for 2020. Medicare Part A covers hospital stays, skilled nursing facilities, and in some cases hospice and in-home health care while Part B covers most doctor services, outpatient therapies, and durable medical equipment.

Medicare Part A Changes

Most people with Medicare do not have premiums for Medicare Part A to begin with, which covers inpatient hospital care for the first 60 days per benefit period (after a deductible). However, deductibles and coinsurance costs tend to rise from year to year. The deductible for an inpatient hospital stay will go up to $1,408 in 2020, an increase of $44. 

Daily coinsurance costs for the 61st through 90th day will increase to $352 per day while costs for lifetime reserve days will rise to $704 per day. Those are increases of $11 and $22 respectively. The new cost of coinsurance for days 21 through 100 of extended care services at a skilled nursing facility will increase $5.50 to $176 per day.

When are Medicare Part A Premiums required?

There are no Medicare Part A premiums if the beneficiary (or their spouse) had accrued 40 or more employment quarters while paying Medicare taxes, which comes out to ten years. If individuals or their spouse had between 30-39 employment quarters, there will be a monthly premium for Medicare Part A of $252 in 2020, a $12 increase from 2019.

Individuals that have less than 30 quarters of employment, or are disabled and have exhausted other coverage, will need to pay the full Medicare Part A coverage. In 2020, that cost will be $458 a month, a $21 increase from 2019.

Medicare Part B Changes

Covering home health care services, equipment, and other services not covered by Part A, Medicare Part B premiums, deductibles, and copays will also see increases in 2020. These increases in cost are determined by Social Security, income, and other costs. 

The standard rate in the upcoming year for enrollees will be $144.60, an increase from $135.50. The annual deductible will increase to $198 in 2020 from $185 in 2019. As we mentioned earlier, an individual’s income also plays a part in Part B costs via income-related monthly adjustment amounts (IRMAA). These prices are for individuals that made $87,000 or less according to income tax returns or made less than $174,000 based on a joint filing.

The following is a chart for other incomes:

Medicare Parts A & B Premiums and Deductibles

If an individual was married and lived with a spouse, but filed separate income tax returns, they will see different increases. If income was $87,000 or less, there is no IRMAA and the monthly premium is still $144.60. Filing between $87,001 and $413,000 will see an adjustment of $318.00 for a total monthly payment of $462.70. Anything over $413,000 will pay a $491.60 premium after an adjustment of $347.00.

If you have any more questions about these increases or would like more information on Medicare Advantage plans, Medigap plans, Prescription Drug plans, or Medicaid services, contact VibrantUSA today. We have been helping clients find the right plans and the best prices since 2003. Already on Medicare or closing in on Medicare age? Get in touch with us and let’s see how we can help.

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