The Centers for Medicare and Medicaid Services recently announced Medicare Parts A and B’s premiums, deductibles and copays for 2020. What does it mean for you and your clients?
We’re glad you asked.
Medicare Part B
A beneficiary’s monthly Medicare Part B premium will increase from $135.50 in 2019 to $144.60 for 2020 (an increase of $9.10.) The annual deductible for Medicare Part B is $198 in 2020, an increase of $13 from 2019 when the deductible was $185.
Medicare Part A
A beneficiary’s monthly Part A premium will be $458/month for 2020 (a $21 increase from 2019 when it was $437/month.) However, keep in mind most Medicare beneficiaries are exempt from this premium since they (or a spouse) paid into the Medicare program while working. For 2020, the Part A deductible is $1,408 (a $44 increase from 2019.)
As for the Part A premium, CMS will raise it from $437 per month to $458 per month next year, which is a $21 increase from 2019. (Note: Most Medicare beneficiaries are exempt from paying the Medicare Part A premium since they or their spouse paid into Medicare while working.) The 2020 Part A deductible is $1,408 — $44 more than in 2019. A beneficiary’s coinsurance amounts also see a minor increase from 2019, as shown in the chart below.
Medicare Part A 2020 Deductible & Coinsurance Amounts
|Form of Cost Sharing||2019||2020|
|Inpatient Hospital Deductible||$1,364||$1,408|
|Daily Coinsurance (Days 61-90)||$341||$352|
|Daily Coinsurance for Lifetime Reserve Days||$682||$704|
|Skilled Nursing Facility Coinsurance||$170.50||$176|
Do you have a client who is considered “held harmless?” (CMS’s Hold Harmless Provision states that certain beneficiaries’ Part B premium increases cannot exceed the increase in their Social Security benefits.) If so, he or she will pay less than the standard Part B premium. However clients who have higher incomes will be responsible for paying high income-related surcharges for their Part B premiums.
The chart below breaks down how your clients’ annual incomes may affect their 2020 Part B monthly premiums.
|File Individual Tax Return||File Joint Tax Return||Monthly Adjustment||2020 Part B Monthly Premium|
|$87,000 or less||$174,000 or less||$0||$144.60|
|$87,001 to $109,900||$174,001 to $218,000||$57.80||$202.40|
|$109,001 to $136,000||$218,001 to $272,000||$144.60||$289.20|
|$136,001 to $163,000||$272,001 to $326,000||$231.40||$376.00|
|$163,001 to $500,000||$326,001 to $750,000||$318.10||$462.70|
|$500,001 or more||$750,001 or more||$347.00||$491.60|
|File Separate Tax Return from Spouse||Monthly Adjustment||2020 Part B Monthly Premium|
|$87,000 or less||$0||$144.60|
|$87,001 to $413,000||$318.10||$462.70|
|$413,001 or more||$347||$491.60|
CMS reports there are nearly 61 million Americans currently enrolled in Medicare Part A, Part B or both, which means you likely have many insurance clients who will be impacted by these cost increases. In order to best serve your clients, make sure you are prepared to walk them through these newly released figures, and potentially assist them in adjusting their coverage, as needed.
Note: Table figures are from CMS’ 2020 Medicare Parts A & Premiums and Deductibles Fact Sheet.
Using a local Medicare FMO in North Carolina keeps you up to date with the most important news in your industry. We want you to be successful in 2020, and we’re here to help you be prepared. If you would like to talk with us about helping you market for 2020, give us a call at 919-460-6073 or email us at email@example.com.