Having a basic understanding of Medicare’s calendar year and how it works with your benefit periods will help you better prepare for any out-of-pocket medical costs. In this article, we’re covering Medicare’s calendar year, how Part A benefit periods & deductibles work, and how Medigap coverage can help pay for these deductibles.
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Does Medicare Run on a Calendar Year?
Yes, Medicare’s deductible resets every calendar year on January 1st. There’s a possibility your Part A and/or Part B deductible will increase each year. The government determines if Medicare deductibles will either rise or stay the same annually. Medicare announces Part A & Part B deductible changes each year around the end of October or the beginning of November.
How Do Medicare Benefit Periods Work?
It’s important to understand the difference between Medicare’s benefit period from the calendar year. A benefit period begins the day you’re admitted to the hospital or skilled nursing facility.
In this case, it only applies to Medicare Part A and resets (ends) after the beneficiary is out of the hospital for 60 consecutive days. There are instances in which you can have multiple benefit periods within a calendar year. This means you’ll end up paying a Part A deductible more than once in 12 months.
How Do Lifetime Reserve Days Work with Medicare?
Part A covers inpatient hospital care, skilled long-term facility, and more, for up to 90 days. But if you ever need to extend your hospital stay, Medicare will cover 60 additional days, called lifetime reserve days.
For instance, if your hospital stay lasts over 120 days, you will have used 30 lifetime reserve days. Please note that you’ll pay a coinsurance for each lifetime reserve day you use. You can only use your lifetime reserve days once.
Yearly Medicare Deductibles
The calendar-year deductible is what you must pay before Medicare pays its portion, but you will still have coverage until you reach your deductible. In 2023, the deductible for Part A costs $1,600, while Part B’s deductible is $226. The Part A deductible must be met per benefit period, not per calendar year.
Medigap Plans that Cover Medicare’s Yearly Deductibles
One way to avoid paying for deductibles is by purchasing Medicare Supplement, also called a Medigap plan. There are 12 Medigap plans, letters A-N. Each plan varies by price and benefits. All Medigap plans, with the exception of Plan A, cover the Part A deductible. Medicare cost sharing covers a percentage of the Part A deductible. Only Medigap plans C and F cover the deductible under Part B.
FAQs
How to Get My Medicare Deductibles Covered With Medicare
You can get your Medicare deductibles covered by enrolling in a Medigap plan. As we mentioned above, Medigap pays for out-of-pocket costs not covered by Original Medicare. Give us a call so one of our licensed Medicare agents can get you enrolled. You may also complete our online rate form to see available Medicare plans in your area now.
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Can a physical exam or annual wellness visit be scheduled closer than 365 days from each other?
For Medicare coverage, you will need to schedule the appointments at least 365 days apart.
I’m 72 (73 in February) and Humana (medigap f) didn’t inform me of the big price hike until after open enrollment was over. I would like to change to an advantage plan but don’t think it’s possible right now. Any hope?
Phil, when you are on a Medicare supplement, there is no specified timeframe in which changes to your plan can be made. You can make changes at any time if you pass underwriting health questions. If you wish to change to a Medicare Advantage, you would need to wait until the Annual Enrollment Period. However, our licensed agents can review your health history and help you make an informed decision regarding the change. Fill out this form to be connected to an agent.
The following from https://www.medicarefaq.com/faqs/medicare-advantage-vs-medicare-supplement/
Hi Lindsay,
I believe we would much prefer the Medigap plan scenario. However, having lived outside the US since June 2015, how then would we be able to use the open enrollment? Also, would I have to begin paying Part B (we have been discussing this issue on another page: https://www.medicarefaq.com/faqs/medicare-calendar-year-and-benefit-periods/#comment-3258) in order to be able to acquire Medigap?
I much appreciate your help.
Hi, again Dwight! Yes, you have to enroll in Part B to be eligible for a Medigap plan. Your Part B effective date is what triggers your Medigap open enrollment period. Once you enroll in Part B, your 6-month Medigap OEP will begin with your Part B effective date.
Hello Lindsay,
My wife and I are Social Security Benefit Recipients and are Expats living in the Czech Republic.
At some point within a few months to as much as 22 months we are selling our apartment here and moving back to America. Specifically, we want to move to Binghamton, New York.
After entering the Social Security Benefits program in January of 2015, and retiring from my work in Iowa we moved here to the Czech Republic in July of 2015.
I am 72 and my wife is 63. I need to be aware of all the necessary ins and outs of being on Medicare and certainly also supplemental insurance in relation to expected premiums and other related out of pocket costs.
Where can I receive information to become fully aware of all that we need to know and understand about Medicare and the 4 parts of Medicare as well as supplemental insurance and related costs?
I have searched many websites related to my questions and there just seems to be a plethora of answers but not too much clarity about a best way forward.
If I were already in the US I could easily go to a Social Security office and get some answers, but this cannot be. Thus I need the answers regarding the possible costs before we definitely decide that our move back to America can be afforded. We only have our Social Security Benefit and no other income whatsoever.
Please if you can give some answers we would so appreciate any help you can offer. Even a list of websites where I can get some answers.
Thank you so much for your help, it is much appreciated.
Dwight and Svetlana Baker
Hi Dwight! Unfortunately, even if you were in the U.S., as of now all Social Security offices are still closed due to the pandemic. You would have to call them either way. You can sign up for a MyMedicare.gov account to manage your benefits. If you’re collecting Social Security benefits you may have been automatically enrolled in Part A & Part B. If you declined Part B, without another form of creditable coverage, you would have incurred penalties since your turned 65. This is true for both Part B & Part D. Part A is premium-free. The standard Part B premium is $148.50. If you went 7 years without creditable coverage since you turned 65, you would have incurred a Part B penalty of $104. That would make your Part B premium around $253 per month. Part D is your prescription drug coverage, the average premium is around $33. Again, if you went 7 years without creditable coverage since you turned 65, you would have incurred a penalty of around $24. That would make your Part D premium around $57 per month. Yes, even though you were not in the U.S., CMS still requires you to enroll in Medicare when you are first eligible. You will be penalized regardless if you were in the United States to use the benefits or not. You then would have to decide between a Medicare Advantage plan or a Medigap plan as your supplement. If you can afford a Medigap plan, that’s always the better route to go. Many beneficiaries are unhappy with the pros and cons of Medicare Advantage plans due to the restrictions it comes with. You can download the Medicare & You handbook to give you more information. You can also join our Facebook community and/or subscribe to our YouTube channel to learn more.
Hi Lindsay,
Would private health insurance we have had while in the Czech Republic count for creditable coverage? When we came here we anticipated never returning to America thus I declined to have Part B and consequently have not paid anything into Part B since turning 65.
Thoughts
Hi Dwight! Unfortunately no, private insurance outside the United States is not considered creditable coverage under Medicare. You can find more information on SSA.gov regarding Czech credits. Please note, work credits earned towards Social Security are NOT the same as Medicare credits in regards to premium-free Part A. However, you have paid into Medicare enough credits to get premium-free Part A. But you still needed to enroll in Part B when you were first eligible to avoid the late penalties since overseas insurance is not considered creditable.