Medicare Part A
The standard Medicare Part A premium will rise in 2021. Part A premium for people with 30+ (but less than 40) quarters of work history is projected to be $263/month. And for people with fewer than 30 quarters of work history, the premium for Part A is projected to be $478/month. However, most people qualify for a $0/month premium.
Medicare Part B
The Medicare Part B premium will rise, with current projections showing the 2021 premium is estimated to be about $144.50/month. The Medicare Part B deductible for 2021 has not yet been announced by the federal government, but it is expected to rise above the current $198. As of 2020, any plan that does not require payment of the Medicare Part B deductible will no longer be allowed to be sold to people newly enrolling in Medicare 2020, which is why Medicare Supplement plans C and F aren’t available to new enrollees.
Supplement Plan C and F
Medicare Supplement Plan C and F will no longer be available for people enrolling in Medicare in 2020. That means people who were enrolled in Medicare Supplement Plan C or F before 2020 may keep their current plans or switch to another Plan F or C in the future. However, for those newly eligible for Medicare in 2020, plans C and F won’t be available. This is because all plans that cover the Medicare Part B deductible are no longer allowed to be sold to new Medicare beneficiaries. For this reason supplement plans C and F are being discontinued for new Medicare enrollees. These changes were created in 2015 legislation to save money on Medicare overall.
Medicare Part D
Medicare Part D covers prescription medications. In 2020 the Part D Coverage Gap—also known as the “Medicare Part D donut hole”—was finally closed. This “donut hole” refers to the high cost for prescription drugs after an initial amount of medication is reached ($4,131 in 2021). Previously, those on Medicare had to pay a higher percentage for brand-name and generic drugs before reaching this amount, however, since the “donut hole” was closed as of January 2020, the percentage has been lowered overall to make the program more affordable for most people. As of 2020, people with Medicare Part D won’t be asked to pay more than 25% of the costs of prescription medication, which is the normal amount paid once the plan’s deductible is met.
Medicare Part G
There’s a new high-deductible version of Medicare Supplement Plan G that was introduced in 2020. It’s similar to the high deductible version of Plan F, except it also covers the Medicare Part B deductible, making it compliant with the changes to 2015 law that requires this coverage. The Medicare Supplement Plan G High Deductible has a deductible amount of $2,370 in 2021. After your deductible is paid, Medicare pays the rest. The Medicare Supplement Plan G High Deductible will typically have a much lower premium than other plans because the deductible is so much higher. This makes it an ideal plan for someone who does not need medical care as often and isn’t worried about paying the cost of the deductible if needed.
Recap of the Biggest Changes
The biggest changes to Medicare in 2021 will be:
- Anticipated slightly higher premiums for Medicare Part A for those who are not entitled to premium-free Part A.
- Anticipated increase in premiums and deductibles for Medicare Part B, including continuation of the 2020 requirement that the Medicare Part B deductible be part of every supplement plan.
- As of 2020, supplement plans that don’t require payment of the Medicare Part B deductible—meaning Medicare Supplement plans C and F—will no longer be options for people enrolling in Medicare after 2020.
- The addition of a higher-deductible Medicare Supplement plan in the form of Medicare Supplement Plan G.
- The closing of the Medicare Part D “donut hole.”
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