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  • Writer's pictureBob Wilkowski, ASA

How to Save on Medicare Costs (Part 1)

Updated: Jun 9

Medicare beneficiaries often live on a fixed income that’s stretched out under normal circumstances. So, with today’s inflation affecting the cost of food, healthcare, and other expenses, their standard of living could be severely diminished. Some may even have to choose between buying food and prescription drugs. (Reports indicate that poverty is rising among senior citizens.)

If you’re on Medicare and under financial stress, there are many ways to find relief! In this and next month’s articles, I’ll provide a list of resources that can help reduce your Medicare premiums and out-of-pocket expenses (such as copays and deductibles). Let’s get to it!

Medicare Savings Programs (“MSPs”) offer assistance with your hospital (“Part A”) and medical (“Part B”) expenses – especially the premiums. To qualify, your resources and monthly income must fall below certain limits that increase every year. (Side note #1: “Resources” are your stocks, bonds, and the money in your checking, savings, and retirement accounts.) You can apply for MSPs through your state’s Medicaid program.

Another cost-saving measure is to explore the Medicare Advantage (“MA”) Plans in your area. (Side note #2: There are two primary ways to get Medicare coverage. The first is through the government, which is known as “Original Medicare”. The second way is through a private insurance carrier, which is known as “Medicare Advantage”. MA Plans include the benefits of Original Medicare plus dental, hearing, vision, and other extra benefits.)

  • Fortunately, many MA Plans are available, all of which have different designs. So, you may find one that, when compared to your current plan, better fits your needs and reduces your costs. (For example, if you have recurring appointments with a number of specialty doctors, you may discover an MA Plan with lower copays for specialists.)

  • If you’re in good health (or a veteran who utilizes your VA benefits), the Part B premiums could be your largest medical expense. (Side note #3: In 2023, the Part B premium is $164.90 per month.) So, you may want to find an MA Plan with a “giveback” feature that lowers your Part B premium. (Side note #4: If you’ve seen the commercials about putting money back in your Social Security check, they’re referring to an MA Plan with a Part B “giveback”.)

(Side note #5: These side notes are piling up.)

Extra Help – also known as the Part D Low-Income Subsidy – is a federal government program that offers assistance with your prescription drug costs. Like the Medicare Savings Programs above, your resources and annual income must fall below certain limits to qualify. You can apply for Extra Help through the Social Security Administration.

If you’re not eligible for Extra Help, then Pennsylvania has two programs – called PACE and PACENET – that offer low-cost prescription drugs. Eligibility for either program is based on your previous year’s gross income.

I hope this serves as a good starting point for saving on your Medicare costs. I look forward to sharing additional resources next month!

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