Does Medicare Have an Out-of-Pocket Limit?

Does Medicare have an out-of-pocket limit? Well, yes and no. Original Medicare, which is Part A and B, does not. However, Medicare Advantage, also known as Part C, does. The maximum out-of-pocket limit for Medicare Advantage in 2022 is $7,550 per year for in-network providers. For in- and out-of-network providers, the maximum limit is $11,300 per year.

How Can I Reduce Costs?

If you enroll in a Medicare Advantage plan, the best way to keep your out-of-pocket spending low is by staying within your plan’s network to receive your care. You will have the out-of-pocket limit, but staying within the plan’s network (if it has one) will make your coverage cheaper than receiving your healthcare and services outside of the plan’s network.

If you stay with Original Medicare, there are no specific plan networks. You can receive coverage from any hospital or provider as long as they accept Medicare. However, if you’re still looking to reduce your out-of-pocket costs, you can add a Medicare Supplement (Medigap) plan. Medigap plans will provide coverage for the out-of-pocket costs that Original Medicare won’t cover, which include:

  • Coinsurance and hospital costs
  • Deductibles
  • First three pints of blood in a transfusion
  • Excess charges
  • Hospice care coinsurance and copayment
  • Foreign travel emergency care
  • Skilled nursing facility care coinsurance

What About Prescription Drug Coverage?

Part D plans cover prescription drugs and cost, on average, $33.37 each month in 2022. After meeting the yearly deductible ($480 in 2022), you will pay copayments and cost-sharing until you hit the “donut hole” limit of $4,430. In the donut hole, you will pay 25% of the cost of the drug until you hit the catastrophic coverage limit of $7,050 in 2022. Afterward, your costs are not capped but are very limited.

Learn More About Medicare with ReLion

At ReLion Insurance Solutions, we are dedicated to providing you with the resources you need to make educated decisions about your Medicare costs and coverage. Give us a call today to learn more about your Medicare options and find the plan that works best for you!