2016 Medicare Premiums

Medicare and You

The following is for Original Medicare Parts A, B and D.

Go here to see a version of the following chart in larger text.
Go here for information on the Part B penalty.
Go here for information on the Part D penalty.

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What is Covered and What You Pay

Part A

Monthly Premium
Most people pay $0 each month for Part A, because they worked 40+ quarters. If you have between 30 and 39 quarters, you may buy into Part A for $226 per month. Otherwise the premium for Part A is $411 per month.

Hospital Stay
$1,288 deductible and $0.00 coinsurance for days 1-60 of each benefit period*.
$322 Coinsurance per day for days 61-90 each benefit period.
$644 Coinsurance per day for Lifetime Reserve days. (Lifetime Reserve Days are 60 extra days of coverage you can use in your lifetime). You pay all costs for each day over 90 days once Lifetime Reserve days are exhausted.

Skilled Nursing Facility
$0 copay for the first 20 days each benefit period*.
$161 per day copay for days 21-100 each benefit period.
You pay all costs for each day after day 100 in benefit period.

*A benefit period begins the first day you’re admitted into a hospital or covered SNF stay and ends when you’ve been home for 60 days with readmittance into either type of facility.

Hospice Care
$5 co-pay for out-patient prescription drugs. 5% of Medicare approved inpatient respite care.

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Part B
Part B Monthly Premium for 2016
$121.80 *
*except $104.90 if your Part B premium was withheld from your Social Security check in 2015
There is also a Part B premium adder for those with higher incomes. See below under the Part D section.Annual Deductible
$166.00.

What Part B Covers and What You Pay
Medicare Approved Services
20% coinsurance for most doctor services, outpatient therapy, preventive services, and durable medical equipment.
Home Health
$0 copay for Medicare approved services.
Clinical Laboratory Services
$0 copay for Medicare approved services.
Mental Health
20% – 35% coinsurance for Medicare approved services
Blood (inpatient)
You pay all costs for first three pints of blood.
Blood (outpatient)
You pay all costs for first three pints of blood, then 20% of Medicare approved amount for additional pints of blood.

Part B Late Enrollment Penalty

If you don’t enroll in Medicare Part B when you’re first eligible during what is known as your Initial Enrollment Period (IEP), you may face delays getting coverage as well as a late enrollment penalty. The only time you can safely defer enrollment past your IEP is if you or your legal spouse are working for what is considered a large employer and you have group health coverage through that same employer.  In this case you have what’s called a Special Enrollment Period (SEP) to apply for Part B without penalty.

Your SEP is 8 months from the end of your active employment or the end of the group coverage, whichever comes first. Note that retiree coverage and COBRA don’t count as active employer coverage and will not allow you a SEP. They are typically not considered primary coverage either and are secondary to Medicare whether or not you’ve actually enrolled in Medicare. That means that if you stop active employment and you’re eligible for Medicare but haven’t signed up, you will be without primary coverage even if you have a retiree plan or COBRA. These plans can recoup payments made in error.

Should you miss your IEP and not have a SEP then your only opportunity to enroll in Part B is during the General Enrollment Period (GEP). This is only during the first quarter of each year, Jan. 1 – March 31 and your coverage won’t start until July 1 of that year. Most people who enroll during the GEP will have a permanent late enrollment penalty added to their monthly Part B premium. The penalty is equal to 10% of the current year’s base Part B premium for each 12 month period that you were eligible for Medicare but not enrolled and did not have active employer group coverage.

It can be complicated so see HICAP for assistance. HICAP Counseling

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2016 Parts B and D Income Adjustments for Higher Income Beneficiaries

If your yearly modified adjusted gross income from your 2014 tax return is: Part B Monthly Adjustment Total Part B Monthly Premium Part D Monthly Premium Adjustment *
File Individual Tax Return: File Joint Tax Return:    
$85,000 or less $170,000 or less $.0.00 $104.90/$121.80 $0.00
$85,001 to $107,000 $170,001 to $214,000 $48.70 $170.50 $12.70
$107,001 to $160,000 $214,001 to $320,000 $121.80 $243.60 $32.80
$160,001 to $214,000 $320,001 to $428,000 $194.90 $316.70 $52.80
Above $214,000 Above $428,000 $268 $389.80 $72.90
Married filing separately with modified adjusted gross income: Part B Monthly Adjustment Total Monthly Part B premium Part D Monthly Adjustment
$85,000 or less $0 $104.90/$124.80 $0.00
$85,001 to $129,000 $194.90 $316.70 $52.80
Above $129,000 $268 $389.80 $72.90

* Plus your Plan’s premium and any late enrollment fee (Part D penalty).

How much is the Part D penalty? What is creditable coverage?

Medicare calculates the Part D penalty by multiplying 1% of the “national base beneficiary premium” (which is $34.10 in 2016) times the number of full, uncovered months you didn’t have Part D or creditable coverage (another drug plan that has at least the benefits offered by Part D). The national base beneficiary premium may increase each year, so the amount of your penalty may also increase each year. The Part D penalty is permanent unless you qualify for Extra Help. The penalty is added to your monthly base premium for your prescription drug or Medicare Advantage plan.

Avoid the Part D penalty by making sure you have a Stand-Alone Part D drug plan, or a Medicare Advantage plan with prescription drug coverage, or another plan, such as an employee medical plan or an employee retirement plan that includes creditable prescription drug coverage, in force from the month when you reach age 65.

  • All 2016 Medicare Advantage plans in Contra Costa County have creditable prescription drug coverage.
  • All 2016 Stand-Alone Prescription Drug Plans in Contra Costa County provide creditable coverage.
  • Veteran’s Administration prescription drug coverage is creditable.
  • Employer, Union, Retiree and COBRA plans may or may not have creditable coverage for prescription drugs.
  • Drug store prescription discount cards are not creditable coverage.

You can meet with a HICAP counselor to review your current prescription drug coverage and help you determine if it is creditable coverage and what steps you can take.

To see what Part D covers see the Medicare Advantage Plans and Stand-Alone Drug Plans pages. For information about the Part D coverage gap go to the Donut Hole page.

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· 2017 Open Enrollment
· What Part A Covers
· Part B Premiums
· What Part B Covers
· Part B penalty
· Part D Income Adjustments and the Part D Penalty

 

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