What Exactly Are Medicare Copays and Deductibles?


Quick Answer

A deductible is the amount of money that Medicare enrollees need to pay before Medicare starts to help cover the cost of medical needs or prescription drugs, reports AARP. Copayment is a percentage or set amount that Medicare enrollees must pay as their share of services or drugs.

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Full Answer

Medicare Part A hospital insurance, Medicare Part B medical insurance and Medicare Part D prescription drug coverage all have deductible amounts that patients must pay before Medicare pays anything, according to WebMD. For instance, the deductible for Part A is $1,260 per benefit period, and the annual deductible for Part B is $147 as of 2015, states Medicare.gov. Private insurance companies supply Medicare Part D drug coverage, and the deductible varies from plan to plan, but the maximum yearly deductible that the law allows is $320.

Each part of Medicare coverage carries copayments or coinsurance, explains WebMD. For example, although patients do not pay for the first 60 days of hospital stay under Medicare Part A, after 60 days patients must pay a coinsurance of $315 per day, and after 90 days they must pay $630 per day as of 2015, reports Medicare.gov. Coinsurance for Part B is generally 20 percent of health care costs, states WebMD. Copayment costs for prescription drugs in Medicare Part D varies according to plan.

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