Chapter 2 – Medicare Part B Medical Insurance
Understanding Medicare Part B
While Part A of Medicare is the first half of “Original Medicare,” the second half is called Medicare Part B. It covers routine health services such as doctor visits, medical testing, lab services, outpatient services, preventive care, durable medical equipment and supplies, ambulance services and more. Everyone who is a U.S. citizen is eligible for Part B.
Before Age 65 – What to Do for Part B
If you started receiving your Social Security benefit before age 65, then you will automatically be enrolled in Medicare Part A and Part B. If you are covered by a qualified workplace plan, you may want to decline the Part B coverage since it carries a monthly premium. We cover this topic in more detail below.
When you enroll in Part A at age 65, you are automatically eligible for Part B. You can enroll in Medicare Part B during your Initial Enrollment Period (IEP). Your IEP includes the three months before you turn 65, your 65th birthday month, and the three months after you turn 65. If you miss your IEP, there are still ways to apply. However, you could incur penalties if you wait too long. For more information on how to apply, visit the Social Security Administration website.
What if I am Still Working?
If you or your spouse is still working, you may want to delay enrollment in Part B, and continue to use the insurance provided by your employer. If you continue to use your employer’s health benefits, you will have the opportunity to enroll in Medicare Part B after you retire, and without penalty. If you are still working, always research this option with your employer. It may be to your advantage to delay Part B enrollment. If you were enrolled in Part B automatically because you have applied for Social Security in the past, you may voluntarily terminate Medicare Part B by completing a series of steps with the government.
Monthly Premium for Medicare Part B
The monthly premium for Medicare Part B is based upon your income. The premium for Part B may potentially increase if your income goes up. Visit the Medicare Website for current pricing and payment information.
Coinsurance for Medicare Part B
Like Part A, Part B is an 80/20 system. The government has negotiated the cost of everything it will cover with companies providing service, and Medicare will pay 80% of that negotiated cost. You, the patient, will be responsible for the other 20%. This is called coinsurance. The portion you are responsible for does not have a limit, and this is one reason people purchase additional insurance. The purchase of additional insurance is covered in Chapter Four, “Medicare Supplement Insurance” and Chapter Five, “Medicare Part C – Advantage Plans.”
Deductible for Medicare Part B
Another cost associated with Medicare Part B, in addition to the monthly premium and the coinsurance, is the annual deductible. When you visit the doctor, you will be responsible for meeting your deductible and paying the remaining amount of the negotiated cost. Medicare will begin to pay for its 80% of the cost only after your annual deductible has been met.
Not All Medical Providers Take Medicare Part B
Unfortunately not all medical service providers accept Medicare. Before selecting a provider, be sure to ask if they accept Medicare. If they do not, you will be responsible for paying for their services without the assistance of Medicare.
You May Not Need Medicare Part B
If you believe you will not need Medicare Part B because you are using another medical health benefit program, be sure to do your research with Medicare and the other program provider.
Contact an Advisor
Investment advisory services are offered through Provision Asset, LLC, a Registered Investment Advisor in the state of Texas. Insurance products and services are offered through Provision Retirement, LLC, or through our team of independent agents. Provision Asset, LLC and Provision Retirement, LLC are affiliated companies. Provision Asset, LLC and its advisors do not render tax, legal, or accounting advice.