Many folks approaching or entering retirement are in for an expensive surprise: Medicare is not free — and some Medicare costs may be deducted from their Social Security benefits.
Specifically, 53 percent of folks age 50 and older are unaware that Medicare Part B entails costs to the retiree, Money reports, citing the Nationwide Retirement Institute’s latest annual health care survey.
The survey targeted folks considered affluent, defined as those with household incomes of at least $150,000. But you need not be wealthy to learn from this cautionary tale.
While Medicare Part B premiums are higher for folks with higher incomes, they will still cost the typical person $1,608 in 2018. Add in the deductible, and it’s $1,791 — before any out-of-pocket costs.
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Medicare Part B
Medicare is the federally subsidized health insurance program primarily for folks ages 65 and older. And like other government programs, it’s an alphabet soup. We detail this in “7 Things You Need to Know About Medicare.”
Medicare Part B, in short, covers certain doctors’ services, outpatient care, medical supplies and preventive care services.
Some folks may pay more or less, but the standard premium for Part B is currently $134 per month. That amounts to $1,608 over the course of a year — and, for folks who are receiving Social Security benefits, that cost is deducted from their Social Security payments.
The deductible for Part B is currently an additional $183 per year.
To learn more about Medicare costs, check out “Some Medicare Deductibles and Other Costs to Rise in 2018.”
What it means for you
The Nationwide Retirement Institute study found that 72 percent of folks age 50 and older wish they understood Medicare coverage better.
No amount of wishing will change that, though. The only way to avoid being surprised by expenses like Medicare Part B premiums upon retiring is to educate yourself about them before you reach retirement.
The official source of information about Medicare is Medicare.gov, the federal government’s website for the Medicare program. But it’s full of so much information, often written in sterile language, that it can feel more overwhelming than helpful.
So, know that trustworthy third-party help is out there, too. As we’ve reported before, these options include:
The State Health Insurance Assistance Program, or SHIP, for your state or territory. Federal grants fund these programs, which offer counseling and assistance to Medicare beneficiaries. To learn more about them, visit the national SHIP website.
Services that, for a fee, do the heavy lifting for you when the time comes for you to sign up for Medicare.
For more Medicare news, check out Money Talks News’ Medicare page.