Medical Costs Medicare Won’t Cover
There’s no doubt many seniors would face bankruptcy without Medicare, the federal health insurance program for those aged 65 and older. But while Medicare is a godsend, especially for those facing catastrophic or chronic illness, the program doesn’t cover all of the medical care many Americans will need as they age.
Medicare Parts A and B: Traditional Medicare Doesn’t Cover the Cost of Prescription Drugs
Medicare Parts A and B are known as Original or Traditional Medicare. Medicare Part A serves as hospital insurance and covers inpatient hospital stays, stays in skilled nursing facilities, surgery, hospice care, and sometimes home healthcare. Medicare Part B is standard medical insurance and helps pay for doctors’ visits, outpatient care, certain preventive services, and some medical equipment and supplies.
Neither plan covers the cost of outpatient prescription drugs, but seniors can enroll in Medicare Part D, which helps pay for some of those costs. They can also opt for a Medicare Advantage plan – Medicare Part C – which offers more coverage, including prescription drug coverage, for an additional cost. To qualify for Medicare Part C or D, seniors must first enroll in both Parts A and B. They’ll have to pay a premium for the added coverage, and there may be deductibles and co-pays as well. Most Medicare Advantage plans also limit enrollees to doctors, hospitals, and other healthcare providers included in their network.
Traditional Medicare Doesn’t Cover Deductibles and Co-Pays
Medicare Part A requires seniors to pay a deductible, as well as a portion of any hospital stay longer than 60 days. In 2018, that deductible was $1,340, while the hospital stay cost was $344/per day for days 61 through 90 and $677/day for anything past 90 days. Medicare Part B pays 80% of doctors’ services, lab tests, and x-rays once enrollees reach their deductible ($183.00 in 2018). A Medicare supplement policy (Medigap) will usually cover at least part of the deductibles and co-pays associated with Parts A and B, while Medicare Advantage plans frequently offer coverage beyond what’s provided by traditional Medicare.
Traditional Medicare Won’t Cover Most Dental Care
Traditional Medicare plans don’t cover most dental care, include routine dental visits, dentures, fillings, or most tooth extractions. Some Medicare Advantage plans cover basic services, but seniors may still face an annual coverage gap of about $1,500. Some Medicare enrollees opt to purchase private dental insurance or join a dental discount plan. Others deposit funds in a Health Savings Account (HSA) before they enroll in Medicare, which can be used tax-free for medical, dental, and other out-of-pocket costs at any age. However, seniors are prohibited from making new contributions to an HSA once they’ve enrolled in Medicare.
Traditional Medicare Doesn’t Cover Routine Vision Care
For the most part, Medicare Parts A and B don’t cover routine vision care, including the cost of regular exams and eyeglasses. As with dental care, limited vision coverage might be available through some Medicare Advantage plans or through a supplemental policy. Funds from an HSA an also be used to pay routine vision care.
Traditional Medicare Will Not Pay for Hearing Aids
While seniors can’t use Medicare Parts A or B for hearing aids, some Medicare Advantage plans will pay for the devices and fitting exams. There are also discount programs that provide lower-cost hearing aids, and seniors who contributed to an HSA before enrolling in Medicare could use those funds as well.
Don’t Count on Traditional Medicare While Traveling Overseas
Traditional Medicare plans won’t pay for the cost of care when seniors become ill or suffer an injury while traveling overseas. Certain Medigap plans (C through G, M, and N) pay 80% of overseas emergency care, and some Medicare Advantage Plans also offer overseas coverage.
Many travel insurance policies will cover at least a portion of medical costs incurred abroad, and may even pay for medical evacuation.
Medicare Doesn’t Cover Long-Term Care
Medicare will cover skilled nursing care in some limited circumstances, such as rehab after a hospital stay. But the program won’t cover personal care services to assist seniors with bathing, dressing, and other activities of daily living.
With costs on the rise, those 60 or older might want to consider investing in a long-term care policy or explore other means of paying for long-term care, including:
- Medicaid (for low-income seniors)
- Combined Life Insurance with Long-Term Care Benefits
- Combined Annuity with Long-Term Care Benefits
- Home Equity Conversion Mortgage
- Life Insurance Settlement
- Veterans Aid and Assistance (if eligible)
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Sources:
https://www.medicare.gov/what-medicare-covers/whats-not-covered-by-part-a-part-b
https://www.kiplinger.com/article/retirement/T036-C032-S014-6-options-to-fund-long-term-care-in-retirement.html
https://www.medicare.gov/sign-up-change-plans/different-types-of-medicare-health-plans
https://www.medicare.gov/coverage/travelretirement.html
