What Does It All Cost
All Medicare plans have some level of cost sharing. Here are some of the costs you might be responsible for paying.
Premium
A fixed, monthly amount you pay your insurer for your plan coverage.
Deductible
What you pay before your insurer begins to pay its share of the costs. Some Part C plans charge an annual deductible for medical and/or prescription drug costs.
Copay
A defined amount you pay each time you receive care. Copays vary by services and benefits.
Coinsurance
A percentage you pay for medical services after you’ve met your deductible. Insurers set their own percentages.
Out-of-pocket maximum
Medicare Advantage plans have an annual limit on how much you pay for covered services. When you reach that limit, you don’t pay additional costs for covered services. Original Medicare doesn’t have this limit.
| Part A | Part B | Part C | Part D | Medicare Supplement | |
|---|---|---|---|---|---|
| Premium | No premium if you or your spouse worked and paid Medicare taxes for at least 10 years. | Vary depending on income. | Vary by plan. Some plans have no premiums. | Yes | Yes, varies by plan. |
| Deductible | Part A deductibles apply to each inpatient stay. | Yes | Vary by plan | Vary by plan | Some plans |
| Copay | Vary by service and length of care | No | Yes | Vary by plan | Vary by plan |
| Coinsurance | No | Yes | Yes | Vary by plan | Vary by plan |
| Out-of-Pocket Maximum | No | No | Yes | No | No |
Breaking Down Medicare Part D Cost Sharing
There are several stages of cost sharing with Part D plans. Most Medicare drug plans have a Coverage Gap, often referred to as the Medicare “donut hole.” In the Coverage Gap, there is a temporary limit on what the plan covers.
Deductible
stage
Patient pays
*varies by plan
Initial
coverage
Patient pays
Copay/Coinsurance
varies by plan
When total drug costs reach:
2022: $4,430
2023: $4,660
Enter Coverage Gap
Coverage
Gap
Patient pays
Brands
25%
Generic
25%
Exit Coverage Gap
When out-of-pocket costs reach:
2022: $7,050
2023: $7,400
Catastrophic
coverage
Brands:
2022:Patient pays Greater of 5% coinsurance or $9.85 copay
2023:Patient pays greater of 5% coinsurance or $10.35 copay
Generics:
2022:Patient pays Greater of 5% coinsurance or $3.95 copay
2023:Patient pays greater of 5% coinsurance or $4.15 copay
Part D Formularies and Your Costs
Part D plans have a Drug List, or Formulary, that shows all the brand-name and generic drugs it covers.
Many plans have a tiered Formulary, where drugs are divided into groups called "tiers".
In general, the lower the tier, the lower the cost to you.
Y0083_2023AEP_Webpages_ABM_HA_M CMS Approved
Last updated 10/01/2022