What is Medicare Part B?
Medicare Part B is medical insurance that pays for health care services you receive as an outpatient. It also covers physician services both in and out of the hospital.
Medicare Part B is part of the Federal Medicare Program. Medicare consists of four parts, each of which covers a specific set of services:
- Medicare Part A: inpatient hospital coverage
- Medicare Part B: outpatient medical coverage
- Medicare Part C: an optional way to get Medicare Part A and Part B coverage
- Medicare Part D: outpatient prescription drug coverage
Medicare Part B, along with Part A, make up what is called Original Medicare. Original Medicare is also often called traditional Medicare or fee-for-service Medicare. Most beneficiaries opt to receive their Medicare benefits through Original Medicare. With Original Medicare, you have the choice to receive services from any Medicare participating provider.
An alternate way of receiving Medicare benefits is through Medicare Advantage Plans (MAPs). MAPs frequently have network restrictions as to which physician you see. They might also require referrals to specialists. If you choose coverage through Medicare Advantage, you cannot receive benefits through Original Medicare.
By law, MAPs must offer — at a minimum — the same coverage provided by Original Medicare. MAPS might also include Medicare Part D coverage as well as dental or vision coverage.
What Does Medicare Part B Cover?
Medicare Part B medical insurance covers two categories of healthcare costs:
- Medically necessary: supplies and services required to treat a health condition
- Preventive: services that prevent a health condition from developing or catch it while in its infancy
Medicare Part B medically necessary services are subject to deductibles and coinsurance and include the following:
- Doctor visits
- Physical therapy (if requested by a doctor)
- Clinical laboratory services (blood and urine samples, for example)
- Ambulatory surgery center
- Diagnostic tests such as MRIs, CT scans, EKGs, and X-rays
- Durable medical equipment used at home (wheelchairs or walkers)
- Emergency room services
- Physician services while in the hospital
- Outpatient mental health care
- Periodic skilled nursing care for the homebound
- Ambulance services
- Cardiac Rehab
You typically will not pay anything for preventive services, including Medicare Part B’s one-time “Welcome to Medicare” visit. Medicare Part B also covers the following preventive care:
- Hepatitis B, flu, and pneumococcal shots
- Diabetes, cancer, and cardiovascular screenings
- Glaucoma tests
- Bone density measurements
- Alcohol misuse and depression screenings
It is important to remember that Medicare Part B does not cover all of your healthcare costs. Medicare Part B does not cover:
- Outpatient prescription drugs
- Hearing exams or hearing aids
- Eyeglasses or routine vision exams
- Routine dental services, including dentures
- Routine foot care
- Long-term care
- Cosmetic procedures
- Medicare Part B excess charges
Medicare Part B excess charges might apply if a nonparticipating provider delivers your care. Under federal law, doctors who sign up with Medicare (accept assignment) are not allowed to charge more than Medicare’s approved amount for a service. Doctors who do not participate in Medicare are allowed to charge up to 15% more than the approved rate. Medicare Part B does not cover this 15% excess charge.
Medicare Part B might pay for some oral surgery such as repair of jaw or facial fractures or wiring resulting from jaw surgery. Medicare Part B will pay for certain eye care services such as cataract surgery.
Eligibility: Who Qualifies for Medicare Part B?
Eligibility requirements for Medicare Part B medical insurance depend on whether you qualify for premium-free Medicare Part A or whether you have to pay a premium for Part A. To be eligible for premium-free Part A, you must:
- Be entitled to Medicare based on your earnings
- Be entitled to Medicare based on your spouse, parent, or child’s earnings
You (or your spouse) must have worked 40 calendar quarters (10 years) to be eligible for Medicare Part A based on earnings. Eligibility can be through Social Security (SS) or Railroad Retirement Board. If you or your spouse did not work enough quarters, you must pay a premium for Part A.
If you qualify for premium-free Part A, you are eligible for Medicare Part B once you qualify for Part A. If you pay a premium for Part A coverage, you must meet the following requirements to be eligible for Medicare Part B:
- Be 65 or older
- Be a U.S. resident and
- Be either a U.S. citizen or a lawfully abiding U.S. resident for at least five continuous years
You are also eligible for Medicare Part B if you are under 65 and meet the following conditions:
- You are receiving disability benefits through SS or Railroad Retirement
- You have end-stage renal disease (ESRD)
- You have amyotrophic lateral disease (ALS or Lou Gehrig’s disease)
Enrollment Periods: When to enroll in Medicare Part B?
If you are receiving SS or Railroad Retirement benefits, you are automatically enrolled in Medicare Part B medical insurance.
If you are not receiving SS or Railroad Retirement benefits, you have to sign up for Medicare Part B. You can do this by contacting the Social Security Administration in one of several ways:
If you are not automatically enrolled in Medicare Part B and have to sign up, the best time to do so is during your initial enrollment period (IEP). Your seven-month IEP starts three months before your 65th birthday includes your birthday month, and ends three months after you turn 65.
You can opt not to enroll in Medicare Part B when you are first eligible. However, if you wait to join, you might face a penalty. If you delay enrollment, you have two other times when you can enroll in Medicare Part B:
- General Enrollment Period (GEP). If you opt out of Medicare Part B automatic enrollment or do not enroll during your IEP, you can join during the GEP. General enrollment runs from Jan. 1 through Mar. 31 of each year. You will pay a penalty for late enrollment; the penalty will be added to your Medicare Part B premium.
- Special Enrollment Period (SEP). Individuals who do not sign up for Medicare Part B during their IEP because they had coverage under a group plan through their employer (or spouse’s employer) can enroll during an SEP. The SEP is an eight-month period that starts when your employment (or your spouse’s employment) ends or your group coverage ends, whichever comes first. You will not be charged a late penalty if you sign up for Medicare Part B during a special enrollment period.
Be aware that COBRA coverage is not based on employment and does not qualify you for a special enrollment period.
Keep in mind that when you are first eligible for Medicare Part A and Part B, you can choose whether to get your coverage through Original Medicare or Medicare Advantage.
Also be aware that once you are 65 and enrolled in Medicare Part B, you are eligible for a Medicare Supplement insurance plan (Medigap policy). You have six months to join a Medigap plan during which time you cannot be denied coverage or charged higher premiums for an existing health condition. Once you are outside of your initial Medigap enrollment period, you lose the right to guaranteed coverage.
If you have questions about Original Medicare, Medicare Advantage, or Medicare Supplement insurance plans, feel free to give one of our agents a call.
Medicare Part B Premiums: How Much Does it Cost?
You must pay a monthly premium for your Medicare Part B medical insurance. The federal government sets the Medicare Part B premiums and will automatically deduct the premium from your benefits check if you receive benefits from one of the following:
- Social Security
- Railroad Retirement
- Office of Personnel Management
If you do not receive any of these benefit checks, you will receive a quarterly bill. You can pay your Medicare Part B bill with a check or credit card. You can also choose to pay your Medicare Part B premium through Medicare Easy Pay, a service that deducts your monthly Medicare Part B premium from a savings or checking account.
Your premium amount is based on income. Most seniors pay the base rate. However, if your modified adjusted gross income (MAGI) is above a certain threshold, you will pay more for your Medicare Part B premiums. Following is the breakdown of income ranges and their monthly premiums for 2019:
MAGI of $85,000 or less, $135.50
$85,001 to $107,000, $189.60
$107,001 to $133,500, $270.90
$133,501 to $160,000, $352.20
$160,001 to $500,000, $433.40
$500,001 and above, $460.50
- Couples filing jointly:
MAGI of $170,000 or less, $135.50
$170,001 to $214,000, $189.60
$214,001 to $267,000, $270.90
$267,001 to $320,000, $352.20
$320,001 to $750,000, $433.40
$750,001 and above, $460.50
- Married filing separate returns:
MAGI $85,000 or less, $135.50
$85,001 to $415,000, $433.40
$415,001 and above, $460.50
Coverage Gaps: Medicare Part B deductible and coinsurance amounts
Medicare Part B pays 80% of its approved rate for medically necessary services, not 100%. The remaining 20%, called Medicare Part B coinsurance, is your responsibility to pay.
You also have an annual Medicare Part B deductible that you must pay before Medicare Part B pays anything on your claims. In 2019, your Medicare Part B deductible is $185.
Medicare Part A uses benefit periods to track your inpatient and skilled nursing facility stays. For Part A, a benefit period starts the day you are admitted and ends when you have been out of the hospital or skilled care facility for 60 days.
Unlike Part A, your Medicare Part B deductible is tied to a calendar year, not a benefit period. Your deductible starts over each year on Jan. 1.
The coverage gaps between the Medicare Part B payment and your Medicare Part B deductible and Medicare Part B coinsurance responsibility can add up quickly if you have a chronic health condition. Medicare Supplement Plans (also called Medigap plans) can bridge this coverage gap.
There are 10 Medigap plans available, and each plan features a different level of benefits. For help with a Medicare Supplement Plans quote, feel free to give our agency a call.