How Much of All My Health-Care Costs Does Medicare Cover?

Last Updated : 12/19/20197 min read

Medicare covers a wide range of health-care services. But does Medicare cover all your medical expenses? Be aware of the limits of Medicare coverage so you will know how much you can expect to pay.

Medicare coverage: what costs does Original Medicare cover?

Here’s a look at the health-care costs that Original Medicare (Part A and Part B) may cover.

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If you’re an inpatient in the hospital:

  • Part A (hospital insurance) typically covers health-care costs such as your care and medical services.
  • You’ll usually need to pay a deductible ($1,408 per benefit period* in 2020).
  • You pay coinsurance or copayment amounts in some cases, especially if you’re an inpatient for more than 60 days in one benefit period. Your copayment for days 61-90 is $352 for each benefit period in 2020.
  • After you’ve spent more than 90 days in the hospital during a single benefit period, you’ll generally have to pay a coinsurance amount of $704 per day in 2020. You pay this coinsurance until you’ve used up your “lifetime reserve days” (you get 60 altogether). After that, you typically pay all health-care costs.

*A benefit period begins when you’re admitted as an inpatient. It ends when you haven’t received inpatient care for 60 days in a row. You could have more than one benefit period within a year, and you generally pay a deductible for each benefit period.

If you’re not a hospital inpatient:

  • Part B (medical insurance) generally covers costs such as doctor visits and preventive care, such as a yearly wellness visit and flu shot.
  • Part B typically covers certain disease and cancer screenings for diseases.
  • Part B may also help pay for certain medical equipment and supplies.
  • You’ll usually need to pay a deductible ($198 in 2020).
  • You pay coinsurance or copayment amounts in most cases. Under Part B, the coinsurance amount is usually 20% of the Medicare-approved amount. You may get some services at no cost.

For example, if the Medicare-approved amount for a doctor visit is $85, your coinsurance would be around $17, if you’ve already paid your Part B deductible.

Be aware that Original Medicare has no annual out-of-pocket maximum spending limit. If you meet your Medicare Part A and/or Part B deductibles, you still generally pay a coinsurance or copayment amount – and there’s no limit to what you might pay in a year.

Medicare coverage: what prescription drug costs does Medicare cover?

Medicare Part A and Part B don’t cover health-care costs associated with prescription drugs except in specific situations. Part A may cover prescription drugs used to treat you when you’re an inpatient in a hospital. Part B may cover medications administered to you in an outpatient setting, such as a clinic.

So, if you take prescriptions at home and you want Medicare coverage, you’ll need to sign up for this optional coverage. Medicare Part D provides prescription drug coverage through private insurance companies that contract with Medicare.

You can get Medicare prescription drug coverage through a stand-alone Medicare Part D Prescription Drug Plan, or a Medicare Advantage Prescription Drug Plan.

If you’re concerned about how much Original Medicare (Part A and Part B) doesn’t typically cover, you might want to learn about Medicare Supplement (Medigap) insurance. This type of insurance works alongside your Original Medicare coverage.

Medicare Supplement insurance plans typically help pay for your Medicare Part A and Part B out-of-pocket costs, such as deductibles, coinsurance, and copayments. In 47 states, there are up to 10 standardized Medicare Supplement insurance plans available, with lettered names such as Medicare Supplement Plan G. Massachusetts, Minnesota, and Wisconsin have their own standardized Medicare Supplement insurance plans.

Remember those Part A costs you have to pay when you’ve been a hospital inpatient longer than 90 days? Medicare Supplement insurance plans typically pay up to 365 days of hospital costs when your Part A benefits are used up. (Under Medicare Supplement Plan N, you might have to pay a copayment up to $20 for some office visits, and up to $50 for emergency room visits if they don’t result in hospital admission.)  Learn more about Medicare Supplement insurance plans.

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Medicare coverage: what health-care costs does a Medicare Advantage plan cover?

So, how much does health care cost when you have a Medicare Advantage plan? To answer that question, here’s a quick rundown on how the Medicare Advantage (Medicare Part C) program works.

When you have a Medicare Advantage plan, you still have Medicare – but you get your Medicare Part A and Part B benefits through the plan, instead of directly from the government. (Hospice benefits are still covered under Part A.) Private, Medicare-approved insurance companies offer Medicare Advantage plans.

But what about those health-care costs? Since Medicare Advantage plans include Part A and Part B benefits, you know the plans cover them as long as you follow plan rules and Medicare rules. But your cost-sharing portions may vary among plans. There may be an annual deductible, and typically there are copayments or coinsurance amounts as well.

Of course, there’s also the plan premium to pay each month. Some plans have premiums as low as $0 per month. You must still pay your Medicare Part B premium every month, along with the plan premium (if any).

Most Medicare Advantage plans include prescription drug coverage, and many plans offer extra benefits. Routine vision and dental services and acupuncture are examples of some of the benefits a Medicare Advantage plan might offer.

Unlike Original Medicare, Medicare Advantage plans have annual out-of-pocket spending limits. So, if your Medicare-approved health-care costs reach a certain amount within a calendar year, your Medicare Advantage plan may cover your approved health-care costs for the rest of the year.

The table below compares health-care costs among certain Medicare coverage options. We’re using an example of one possible scenario. Dollar amounts listed below are merely for example purposes and may not be the same as your costs.

In this example, Mr. Johnson is recovering from a heart attack two months ago. He visits his cardiologist, who recommends an intensive cardiac rehabilitation program in an outpatient setting. Mr. Johnson has already paid any applicable deductible. This example shows how much he might pay depending on the kind of coverage he has.

Service Medicare Part B Original Medicare plus Medicare Supplement Medicare Advantage
Cardiologist visit 20% of $180 = $36 $0 (under most standardized Medicare Supplement insurance plans). Medicare Supplement Plan N might charge a copayment up to $20. You’re likely to pay a coinsurance or copayment (the amount may vary among plans).
Cardiac rehabilitation program 20% of $1000 = $200 $0 (under most standardized Medicare Supplement plans) You’re likely to pay a coinsurance or copayment (the amount may vary among plans).


Please note that to get the kind of coverage listed in this table, you must go to a doctor that accepts Medicare assignment. Some Medicare Advantage plans require you to use doctors and facilities in the plan’s network.

We hope this article helps you understand how much Medicare might pay toward your health-care costs. As you can see, there are different types of Medicare coverage. We’d be happy to talk with you about the various Medicare coverage options available where you live.

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