Medicare’s 2021 premium announced

The Center for Medicare and Medicaid Services (CMS), the government agency that regulates Medicare, has announced the 2021 Medicare premiums and deductibles for the coming year.

Most people on Medicare have Medicare Part A “free.” In reality, this was pre-paid, as when you receive your payroll check, Social Security and Medicare taxes have been deducted. The Medicare tax is to pay for Part A. This is the hospital benefit.

There are people and their spouse who have never worked under the Social Security system. These people will be paying $471 (up from $458) per month per person. There is a discount for people who earned between 30–39 quarters in their lifetime: $259 (up from $252). Persons, or their spouse, whom have earned 40 or more quarters of work experience pay nothing for Part A.

Medicare Part B, which most people have, will cost $594 per month in 2021. This is up from $578.40. When you see these numbers, they tell us that Medicare benefits are not some cheap insurance. Medicare’s value is $1,065 per month.

The cost of Part B is borne primarily by the American taxpayer. Individually, most persons with individual income (as reported on their 2019 tax returns … two year look back) will get a 75% discount. Therefore, for 2021 the amount either billed or automatically deducted from your Social Security payment will be $148.50, up from $144.60, a very modest increase.

People with higher income as reported on their 2019 tax return who have reported earnings above $88,000 will pay a greater share than the standard 25%. For individuals who earned more that $500,000, or married couples filing jointly, the cost of Part B is $504 per month, the majority of the $594 real cost.

Now that you see the true cost of Medicare insurance, it is understandable why you are seeing all the advertising during this Annual Medicare Enrollment Period (Oct. 15–Dec. 7). Nary does an hour go by on television that you don’t see a Medicare Advantage HMO ad. The mailbox is filled almost daily by proclaimations of one plan or another’s virtues.

According to the Kaiser Foundation study, in 2019 the payment to the insurance companies to the Medicare Advantage plans was equal to 100% of the Medicare cost. No wonder why 40% of Californians have joined a Medicare Advantage plan. Your Medicare Advantage plan is receiving approximately $1,065 per month. That’s $12,780 per person a year!

To control costs, Medicare Advantage plans are in a category known as “Managed Care.” This is why your primary care physician is required to get the okay from the medical group before referrals or expensive tests are performed.

For a limited time, people who would like to get out of the HMO and return to Original Medicare and get a Medicare Supplement policy without Medical questions (medical underwriting) can get a Medicare supplement! With a supplement there are no referrals needed and the policy pays 100% of Medicare allowed expenses after the $203 Medicare Part B deductible.

Call staff at the Harry P Thal Insurance Agency, The Medicare GURU 760-376-2100. Ask for Platinum Service.

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