While Medicare costs can add up fast depending on an individual’s needs and coverage selections, it is a myth that Medicare is unaffordable, or that it is more always more expensive than other forms of healthcare coverage. In fact, many people are surprised to discover that Medicare can lower their medical expenses. There are customizable options available for individuals considering Medicare, and these are worth exploring with the guidance of an experienced Licensed Insurance Agent to better understand all available Medicare options, and what Medicare costs.

Medicare may be expensive for some depending on their financial situation, but Medicare costs vary based on everyone’s healthcare needs and what type of Medicare coverage they select. Let’s look at the costs associated with some of the most common types of Medicare coverage: Medicare Advantage and Medigap, also known as Medicare Supplement, Plans.

How much is Medicare?

When asking what Medicare costs, it’s helpful to break it down by plan type, as Medicare costs can vary significantly based on a variety of factors.

How much is Medicare Advantage?

Medicare Advantage, also known as Medicare Part C or MA Plans, combines Medicare Parts A and Part B, and, in many cases, Medicare Part D prescription drug coverage. If you are wondering how much Medicare Advantage Plans cost, or why you have heard that some Medicare Advantage Plans are free, you may be pleased to learn that many Medicare Advantage Plans are quite affordable. Medicare Advantage Plans are largely federally funded, and thus most plans boast $0 premiums - with the exception of Part B. Medicare Part B premiums must be paid by Medicare beneficiaries directly. The 2024 Medicare Part B premium is $174.70 per month. This amount is subject to change each year, along with deductibles and other costs associated with the selected Plan. However, Medicare Advantage Plans, or Part C, also have out-of-pocket limits to protect beneficiaries from becoming financially overburdened.   

In many cases, utilizing Medicare Advantage can be like having an all-inclusive health plan, making Medicare Part C appealing because it not only offers coverage for standard healthcare needs like doctor and hospital visits, but also typically includes rich dental, vision, and hearing benefits. Additionally, many Medicare Advantage Plans offer coverage/discounts for helpful services like transportation, healthy meals, over-the-counter item benefit allowance, and gym memberships, just to name a few. If Medicare expenses are a concern, Medicare Advantage plans should be considered as a comprehensive, low-cost alternative to Original Medicare.

How much is Medigap?

Medigap, or Medicare Supplement Plans, are insurance designed to be purchased separately and work with Original Medicare. This is important because, despite all the benefits of Original Medicare, it does not cover all the costs associated with healthcare services and supplies. Medigap can help cover some of the remaining healthcare costs including coinsurance, deductibles, and copayments. 

When making your Medicare selections, you might be asking yourself “How much is Medigap insurance?” and the answer is subjective based on your unique healthcare and financial needs. It’s important to consider that some Medigap policies offer coverage for services that Original Medicare does not cover, including travel outside of the United States, but, Medigap generally does not cover long-term care, vision, dental, hearing aids, eyeglasses, Prescription Drug Coverage, or Private Duty Nursing. The Medicare Supplement premium you pay will vary based on the Plan you select, where you live, and other demographic factors. 

Medigap coverage can be customized to meet your needs, but the more coverage you choose, the more expensive is likely to be - and not all Supplemental Plans set out-of-pocket maximums, so you could incur some significant expenses if you are sudden impacted by a new illness or injury or if you need specialty care or equipment like eyeglasses or hearing aids. Depending on your healthcare needs, Medigap, or Medicare Supplement coverage, can be a great option – but it’s important to be wary of potential expenses that could add up fast if you select Medigap coverage.

Considering what Medicare costs

Another important consideration in deciding if Medicare coverage is right for you is the potential benefits that extend beyond cost savings. Transitioning onto Medicare can create a great deal of personal freedom by reducing your dependence on full-time employment for health benefits, thus opening up new doors for the future, whether that be retirement by choice, or leaving the workforce to focus on your healthcare needs.

Ultimately, if you are wondering how much Medicare costs, it’s important to take the time to learn more about Medicare expenses, including deductibles, premiums and common out-of-pocket costs, as well as the many ways in which Medicare coverage might be able to reduce your medical costs and provide you with additional valuable benefits so that you can choose the plan that’s right for you.