Part of the POLITICAL ISSUES AND POLICIES SPECIAL REPORT
Medicare costs change each year, so if you’re 65 or older, it’s important to understand and review your benefits for the upcoming year. Some new rules affect the cost of prescription drugs covered under Part D (Medicare’s prescription drug benefit) and change the times when you can revise your Medicare health and drug coverage.
Medicare Premiums and Deductibles in 2019
Medicare premiums and deductibles have risen a bit since 2018.
Medicare Part A covers inpatient hospital services, skilled nursing facility services, home health care and hospice, and people who have worked for more than 10 years — about 99 percent of Medicare beneficiaries — generally do not need to pay a premium. If you have worked between 7 ½ and 10 years, your Part A premium will increase to $240 per month in 2019, and if you have worked fewer than 7 ½ years, your Part A premium will be $437 per month.
The Part A deductible and coinsurances are also increasing this year. The hospital deductible will be $1,364. Beneficiaries must pay a coinsurance amount of $341 per day for the 61st through 90th day of a hospitalization in a benefit period. For beneficiaries in skilled nursing facilities, the daily coinsurance for days 21 through 100 of extended care services in a benefit period will be $170.50
Medicare Part B covers physician services, outpatient services, certain home health services and medical items. This year, the standard monthly premium for Part B is $135.50 for individuals with a yearly income below $85,000 ($170,000 for a married couple). If your income is higher than that, you may have to pay an income-related monthly adjustment amount, also known as an IRMAA. In that case, your monthly premium will be between $189.60 and $460.50, depending on your income.
The Part B annual deductible is $185 in 2019, and you will continue to pay 20 percent for most Part B-covered services after meeting your deductible in 2019.
Medicare Prescription Drug Costs in 2019
The amount you pay for your prescription drugs on Medicare depends on which Part D prescription drug plan you are enrolled in and which coverage period you’re in. Every Part D plan has a premium; this year, the national average for Part D premiums is $33.19 per month.
Many Part D plans also have a yearly deductible. Deductibles vary from plan to plan, but no deductible in 2019 can be higher than $415. After meeting the deductible, you’ll pay your plan’s regular copays or coinsurances for any drugs you take (if you’re not sure of these amounts, call your plan using the number on the back of your membership card), until the total costs that you and your plan have paid for drugs in a year totals $3,820.
Once you and your plan have together paid $3,820 in drug costs, you will enter what is known as the donut hole or coverage gap. After falling into the donut hole, the amount you pay for prescription drugs increases, until you’ve spent $5,100 in out-of-pocket drug costs for the year. At that point, you enter the coverage phase known as catastrophic coverage. During this period, in 2019, you pay 5 percent of the cost of each drug, or $3.35 for generics and $8.25 for brand name drugs — whichever is greater.
Because of federal legislation, the donut hole will be closing for brand-name drugs in 2019. That means in this coverage period, you will be responsible for paying for 25 percent of the cost of your brand-name drugs. The coverage gap will close for generic drugs in 2020, at which point you will pay 25 percent of the cost of your brand-name drugs.
The Medicare Advantage Open Enrollment Period
If you have a Medicare Advantage Plan in 2019, you’ll have the opportunity to change your coverage using the Medicare Advantage Open Enrollment Period, which occurs from January 1 to March 31. During this time, you can switch from your Medicare Advantage Plan to another one or to Original Medicare, with or without a stand-alone Part D prescription drug plan.
If you make a change during the Medicare Advantage Open Enrollment Period, it will become effective the month after the month when you make the switch.
The Extra Help Special Enrollment Period
If you have Extra Help, the federal Part D Low-Income Subsidy program that helps pay for some to most of the out-of-pocket costs of Medicare prescription drug coverage, your opportunities to switch Part D prescription drug plans will change in 2019. Previously, people with Extra Help had a Special Enrollment Period to enroll in a Part D plan or switch between plans once every month. Starting in 2019, this Special Enrollment Period will be available once per calendar quarter for the first three quarters of the year. To qualify for Extra Help, your monthly income currently must be less than $1,538 ($2,078 for married couples) and your assets must be below specified limits.
If you have Extra Help, these new limits may mean that you are locked into a drug plan at certain times of the year. For this reason, it is important to make sure that any drug plan you enroll in covers as many of your drugs as possible with the fewest restrictions on coverage.
Increased Medicare Advantage Plan cFlexibility
Beginning in 2019, Medicare Advantage plans have increased flexibility in their plan offerings. This means that plans may be able to reduce cost-sharing for certain benefits, offer extra benefits or charge different deductibles for some enrollees who meet specific medical criteria.
Medicare Advantage plans are also gaining the ability to offer new supplemental benefits that are not directly considered medical treatment. Some services that plans can begin offering in 2019 include nutrition services, in-home supports and home modifications.
These changes mean that there may be more Medicare Advantage Plan options available in 2019, and it may become more complicated to compare these options. Remember to carefully review your Medicare Advantage plan’s Evidence of Coverage and any other materials from the insurer. If you need help understanding your plan’s benefits or reviewing your coverage options, call your State Health Insurance Assistance Program for assistance, 877-839-2675, or visit www.shiptacenter.org.
For more information on Medicare costs, visit Medicare Interactive, the free online resource powered by the Medicare Rights Center, and download the Medicare Rights Center’s free guide, Medicare in 2019.