Next up at Simple Senior Health is Part B.  Some people opt to take Part B, and some don’t.  I think Part B is great for those who don’t have everything else covered by retirement benefits.  This is your Medical insurance that focuses on outpatient and doctor-related expenses.  Most people look at this as the 80/20 part of Medicare (Medicare pays 80%, you pay 20%).  Let’s look at what it covers.  Again, what this part doesn’t cover is in red text and words included in the glossary are in purple text.

Part BThere are lots of complementary things that come with Part B that many people don’t realize.  The first thing you should understand that you have as an entitlement is your preventative services doctor visits.  All Part B subscribers are able to have these free visits that are very valuable:

 

Welcome to Medicare Visit

  • One-time review of your health–Free with no deductible
  • Preventative services counseling
  • Includes screenings including EKG/ECG, shots, and referrals to other doctors if needed
  • Must happen within the first 12 months of start Part B

Annual Wellness Visit

  • Once every 12 months after the initial year–Free with no deductible
  • Updating or starting a personalized preventative services plan
  • You can keep track of preventative services related to your plan in your Medicare and You booklet.

Note that neither of these visits are considered physical exams.  You should still get one done for a more extensive look into your overall health.  Be sure to keep track of all preventative services you have done, because there is a Medicare Approved Schedule!

80/20 Medical

The rest of Part B covers “medically necessary services.”  There is an annual deductible of $166 for 2016.  Note that this deductible is annual while the Part A deductible is per benefit period.  This means that the initial $166 that is paid as a deductible is the only one you have to worry about for the whole year, where the Part A deductible can be paid up to 5 times if you have a bad year!  After this deductible is met for the year, Medicare Part B pays 80% of covered expenses, and you pay the remaining 20%.  Part B also pays for 100% of diagnostic exams and varying amounts for preventative services (on a schedule).  There can be excess charges that you are also responsible for.  Let’s review:

Part BMedicare Part B Made Simple

  • Welcome to Medicare Visit and Annual Wellness Visits
  • Annual Deductible of $166 for 2016
  • Medicare pays 80% after deductible is met
  • You pay 20% as well as any excess charges (please read below)
  • Medicare Part B covers diagnostic exams that are covered by Medicare
  • Preventative services at different amounts (see link for details)
  • You are responsible for the cost of preventative services that are done outside of Medicare’s schedule (also at above link).

A word about 80/20.  There is a thing called “accepting assignment” that doctors have the right to do or not do.  When a doctor accepts assignment, he or she basically agrees to charge what Medicare says is acceptable.  If a doctor doesn’t accept assignment, Medicare will still use the Medicare assignment amount to base their 80% on.  The doctor then has the right to charge an additional 15%.  This 15% is called the excess charge.   Here’s a scenario:

You go to the doctor for a checkup and his or her charge is $200.  Medicare’s assignment is $100 (meaning that that’s what Medicare will base their payment on).  The doctor accepts Medicare’s assignment and amends the charge to $100.  Medicare Part B will pay $80, and you’re responsible for $20.

Or, take that same checkup at $200.  Medicare’s assignment is $100.  But instead of accepting Medicare’s assignment, the doctor chooses not to.  The doctor can then charge an additional 15% over Medicare’s assignment.  The good news is that the Medicare-approved amount for these non-participating providers is actually 95% of their assignment, so in this case, $95 (making the 15%  $14.25). Medicare will still pay $76 (80% of $95), and you’re responsible for the $19 PLUS the extra $14.25 making it a total of $33.25 instead of just $20. Of course, you can add a zero to all the numbers and see that the result could be an extra $142.50 on top of the $190.

This again is just Part B made Simple.  There are lots more details, but these are things that are important to know and understand on the most basic level.  More details can be found at Medicare.gov.

Next up, Part C.

related links: When do I sign up, How much does it cost, Glossary