Most of us look forward enthusiastically to the day we are eligible for Medicare coverage – because it costs less than traditional health insurance. But it’s not free. For starters, everyone pays the monthly Part B premium ($170.10 in 2022).
With Medicare Advantage (Part C) plans, besides the Part B premium, you could have plan premiums, plus out-of-pocket costs for deductibles, copayments and coinsurance.
With Original Medicare (Parts A and B), besides the Part B premium, you could pay 20% of most covered expenses with no upper limit. Plus, premiums and payments for an optional Medigap (Supplement Insurance) plan and a private Part D prescription drug plan.
So, even after carefully selecting the best coverage for you, you could have difficulty covering all your Medicare costs.
How to cover the costs of Medicare
Help is on the way! Depending on your income and resources, you may be eligible for one or more of the following:
Medicaid. If you need help affording medical costs, Medicaid (a joint federal and state program) might help. The rules vary state-by-state, so contact your state’s Medicaid office to see what’s available.
Medicare Savings Programs. Your state can help you pay your Medicare premiums, plus some deductibles, coinsurance and copayments through one of the four programs known best by their alphabet-soup initials:
QMB – Qualified Medicare Beneficiary Program
SLMB – Specified Low-Income Medicare Beneficiary Program
QI – Qualifying Individual Program
QDWI – Qualified Disabled and Working Individuals Program
Again, contact your state’s Medicaid office about your eligibility.
Extra Help. Do you need help paying the costs of your Medicare Part D prescription drug plan (such as premiums, deductibles and coinsurance)? If so, check out the Extra Help program. However, it only works for Part D of Original Medicare, not Medicare Advantage.
If you qualify, you could pay no more than $3.95 for a generic drug and $9.85 for a brand-name covered medicine in 2022. Social Security (who runs Extra Help) says it could save you about $5,000 per year.
You might qualify automatically for Extra Help if you have Medicare coverage plus Medicaid, a Medicare Savings Program or Supplemental Security Income (SSI) benefits. Otherwise, apply through the Social Security Office.
Program of All-inclusive Care for the Elderly (PACE). Do you have considerable health care needs but prefer to stay in your community instead of going to a care facility? PACE builds teams of health care professionals to coordinate your care and make that happen. Unfortunately, it is not available everywhere, so check with your state’s Medicaid office.
State Health Insurance Assistance Program (SHIP). SHIP is a free state-level counseling service that can answer any questions you have about Medicare, including the various financial assistance programs in your state. The program’s name might change in each state, but the services are similar.
“Takeaway” action step
The various programs can sound confusing, seemingly offering overlapping assistance. However, a call to your state’s SHIP service can steer you in the right direction to any available services.