Phil Moeller: Filling the coverage gaps in Medicare
Written by Phil Moeller, UnitedHealthcare contributor, Medicare and Retirement expert
While the various parts of Medicare provide widespread health coverage, these do not always pay 100% of the cost of what it covers. For example, there may be deductibles for:
- Part A hospital services
- Part B doctor and outpatient services
- Part D prescription drugs
After these deductibles are paid, there are often gaps in what Medicare will pay for your covered health care, such as:
- Part A of Medicare has expensive copays for people with long stays in hospitals and skilled nursing facilities.
- Part B of Medicare pays only 80% of covered expenses for the costs of doctors, durable medical equipment and other outpatient expenses.
- Copays and drug costs charged by Part D drug plans can differ among Part D insurers, even for the same drug.
Original Medicare (Parts A and B) is provided by the federal government, but people may decide to select other coverage options beyond Original Medicare to help fill these gaps.
Some may opt to buy private Medicare Supplement plans, or Medigap plans, to pay some of these uncovered expenses. There are 10 different Medigap “letter” plans that provide different levels of gap coverage. Each identical letter plan must cover the same benefits, but premiums can differ, so shop carefully.
People with private Medicare Advantage plans are offered similar out-of-pocket protections when it comes to annual out-of-pocket health spending for care and often prescription drugs.
- First, the plans provide a cap on what you pay for health care you receive from doctors, hospitals, and other care providers who have agreed to participate in a plan’s network of care providers.
- Second, plans may cover care from providers outside their provider network. Those who do may charge higher rates than for in-network care. When they do, there will be a separate ceiling on annual out-of-pocket spending for this care.
- Third, Medicare Advantage Part D drug plans will provide annual maximums on spending for prescription drugs. Out-of-pocket costs may vary before hitting the $2,000 maximum.
These three maximums can differ among plans. You should research these differences when selecting a Medicare Advantage plan.
Author bio
Philip Moeller is the principal author of the Get What’s Yours series of books about Social Security, Medicare, and health care. Read his Substack newsletter and his posts on Threads @healthauthor.