The Centers for Medicare & Medicaid services has announced the new Medicare cost sharing amounts for 2021.
The changes are incremental – and lower in some areas than in 2020. We discuss the numbers below and how they affect your premiums, deductibles, coinsurance and out-of-pocket exposure.
These changes affect all insurance plans – both new and old. All Medicare plans must abide by any new cost sharing rules no matter when they were purchased.
Medicare Premiums, Deductibles & Coinsurance For 2020-2021
|Medicare Feature||2020 Amount||2021 Amount||$ Increase|
|Medicare Part B Premiums (For Most)||$144.60||$148.50||$3.90|
|Part A Deductible (Impatient Hospital)||$1,408||$1,484||$76|
|Part B Deductible (Physician's Services)||$198||$203||$5|
|Hospital Coinsurance Days 61-90||$352||$371||$19|
|Hospital Coinsurance Days 91-150||$704||$742||$38|
|Skilled Nursing Facility Coinsurance||$176||$185.50||$9.50|
|High Deductible Plans F, G & J||$2,340||$2,370||$30|
Medicare Part B Premiums & IRMAA Surcharges
Medicare Part B premiums increase each year and 2021 is no different. By rule, those who fall under the “hold-harmless” provision must have their Part B premiums offset by increases in Social Security payments.
Most others will see their premiums increased to $148.50 per month. Higher earners will also experience increases based on their income. Those who are new to Medicare in 2021 will pay $148.50 per month – a $3.90 increase from 2020. It was $9.10 increase in 2019 – so that’s welcome news.
The Income Related Monthly Adjustment Amount (IRMAA) requires individuals making more than $88,000 – and couples filing jointly making over $176,000 – to pay more for Medicare Part B coverage.
|Individual Filers||Joint Filers||Married - File Separately||Your 2021 Monthly Premiums|
|AGI Less Than Or Equal To $88,000||AGI Less Than Or Equal To $176,000||AGI Less Than Or Equal To $88,000||$148.50|
|AGI Greater Than $88,000 And Less Than Or Equal To $111,000||AGI Greater Than $176,000 And Less Than or Equal To $222,000||N/A||$207.90|
|AGI Greater Than $111,000 And Less Than Or Equal To $138,000||AGI Greater Than $222,000 And Less Than or Equal To $276,000||N/A||$297.00|
|AGI Greater Than $138,000 And Less Than Or Equal To $165,000||AGI Greater Than $276,000 And Less Than or Equal To $330,000||N/A||$386.10|
|AGI Greater Than $165,000 And Less Than Or Equal To $500,000||AGI Greater Than $330,000 And Less Than or Equal To $750,000||AGI Greater Than $88,000 And Less Than or Equal To $412,000||$475.20|
|AGI Greater Than $500,000||AGI Greater Than $750,000||AGI Greater Than $412,000||$504.90|
IRMAA premiums are determined by your income from 2 years ago. There are four tiers to the IRMAA payment schedule as seen above. What you made in 2019 determines your 2021 Part B premiums.
Medicare Part A & Part B Deductible Amounts
The Part B deductible is important for a lot of consumers. The Medicare Part B deductible for 2021 is $205 – a $5 increase from 2020. This is helpful for those who own a Medicare supplement that does not cover the Part B deductible. Popular Plans G & N fall into that category.
These two popular policies are purchased often as they have low and stable rates. And since Plan F (which covers the Part B deductible) is no longer available to new enrollees, it’s nice to see this amount remain stable.
The Part A deductible (Inpatient Hospital Care) is increasing to $1,484 – an increase of $76. Most Medicare supplements cover the Part A deductible, but this number is starting to increase more quickly each year. The most popular policies like Plans F, G and N cover this gap.
These are the kinds of changes that make your Medicare Supplement more expensive as most policies cover the amounts listed in the table above.
What is the 2021 High Deductible Plan F, G & J Amount?
Some consumers prefer High Deductible Medicare supplement plans due to their very low premiums. Consumers also like the known out of pocket exposure. Th deductible for all High Deductible policies will increase slightly to $2,370 in 2021. That’s a $30 increase from 2020 which is smaller than the $40 increase from 2019.
Plans F, G and J are the only policies with a high deductible option. Plan J hasn’t been available for many years, but some still own it. Plan F is only be available to those who were Medicare eligible before 2020.
The only plan available for those who are new to Medicare in 2020 and beyond is High Deductible Plan G. In many states, HD Plan G will offer the lowest monthly premiums of any Medicare supplement for sale.
Medicare Supplement Plans K and L Changes
Plans K and L were introduced in 2010 as part of the Medicare Modernization Act. We don’t see a lot of interest in these two policies. They have larger out of pocket exposure, but higher premiums than similar (or even more comprehensive) Supplements.
In terms of cost-sharing, they somewhat resemble Medicare Advantage coverage. Plans K and L do not have network restrictions, however. You can see any doctor or hospital accepting Supplements – which most do.
The increases with these two plans is inline with what we’ve seen in prior years. The out of pocket will be $6,220 for Plan K and $3,110 for Plan L. When you compare benefits and premiums with these two, it’s wise to also consider Plan N or one of the High Deductible policies. There may be more value in the latter.
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