Nearly one in five Americans are covered by Medicare: the federal health insurance program designed to help people aged 65 and up to access the healthcare they need after retirement. In many ways, Medicare simplifies the process to receiving care—but there are still a number of key details to understand about the Medicare program.
Read on to learn more about Medicare Part B, then check out the other articles in the Medicare 101 series to get the scoop on Medicare Part A, Medicare Part C, and Medicare Part D.
Medicare Part B: The Basics
While Medicare Part A is known as hospital insurance, Medicare Part B is sometimes called medical insurance. It covers most forms of outpatient care that don’t involve an overnight stay at the hospital. If you visit your doctor with a sore throat, receive outpatient dialysis treatment, see a physical therapist for recovery support after a broken bone, or go in for a yearly wellness check-up—all these needs are covered by Medicare Part B.
Home health services, such as skilled nursing care or occupational therapy delivered in your home, are covered by Medicare Part B if you haven’t been previously hospitalized. If the home health need occurs after an inpatient stay, however, this is covered by Medicare Part A. The same goes for medical equipment such as a walker or wheelchair.
You don’t need to do any special enrollment for Medicare Part B. By signing up to Medicare, you are automatically enrolled in this portion of Medicare coverage. People who have already applied for Social Security are also enrolled in Medicare; or you can sign up online.
Medicare Part B requires a monthly premium. In 2023, Medicare recipients pay $164.90 per month for their Part B coverage; but the cost is higher for people who report a salary over $97,000 per year. Once you sign up for Medicare, your Part B premiums are automatically deducted from your monthly Social Security payments—so there’s no need to worry about missing a payment.
However, do be aware that there is a late enrollment penalty for people who don’t sign up to Medicare and start paying this monthly Part B premium at age 65. The “Part B Penalty” means you pay an extra 10% for each year you qualified for Part B but opted not to sign up. The penalty is added on to your monthly premiums. However, there is an exception for people who hold similar-value coverage to Medicare and those who qualify for a Special Enrollment Period.
People who have trouble affording the monthly Part B premiums often qualify for Medicaid, which can assist low-income individuals in getting the care they need. There are also Medicare Savings Programs to help reduce the financial burden of Part A deductibles and Part B premiums, as well as various copayments.
Deductibles & Copays
The flipside to Medicare Part B premiums is that Medicare Part B deductibles are relatively small. The Medicare Part B deducible is $226 per year, which means as soon as you’ve paid $226 out of pocket, your insurance coverage will be activated to help cover qualifying outpatient care.
Do be aware that many Part B services also require a copay or coinsurance payment. Generally, the patient is responsible for 20% of the service cost; so if a doctor’s visit costs $100, you would need to cover $20. If the deductible hasn’t yet been met, you’d be responsible for the entire $100. Clinical laboratory services and some mental health care, including a yearly depression screening, have no copay.
Supplemental Medicare insurance, sometimes known as Medigap, is available to help Medicare recipients to cover the cost of deductibles, copays and coinsurance. If you are a frequent user of outpatient healthcare services, you might investigate Medigap plans designed to relieve some of the financial burden of Part B cost sharing.
Do I Need Medicare Part B?
When you enroll for Medicare, you are automatically signed up to receive Part A (inpatient care) and Part B (outpatient care). The required premiums for Part B are automatically deducted from Social Security benefits; but if you don’t receive Social Security and don’t pay your Part B premiums for three months, you may lose all Part B coverage. Programs are available to assist low-income households with Medicare payments, so check in with your state Medicaid office if making monthly premium payments is a concern.