When shopping for or comparing different Medicare plans available to you, there are 4 main pieces to pay close attention to. After you have found a plan that meets your preferences for a network of providers and pharmacies, it’s important to compare the different cost aspects of a plan.
Premium
This is the amount you will pay monthly for your plan. This typically does not count towards your deductible or out-of-pocket maximum.
Deductible
This is the amount you pay out of pocket for health care costs until your insurer picks up a greater share of the costs.
Copay
This is the amount you will pay out-of-pocket for medical visits, services, or prescription drugs.
Out-of-pocket maximum
This is the maximum you will be required to pay out of pocket in a year before your insurer picks up 100% of the costs of your care.
Some Tradeoffs to Keep in Mind
Sometimes people pick a plan with a lower premium because they want to keep costs low. However, often a plan with a lower premium has a higher deductible. This means that if you have to use a lot of services, you will have to pay more out-of-pocket before your plan picks up a greater share of the costs.
Another thing to consider is the out-of-pocket maximum. Traditional Medicare plans do not have an out-of-pocket maximum. This means that even when you have met your deductible you will continue to have to pay a share of your medical costs, no matter how high they get. Most Medicare Advantage plans do have an out-of-pocket maximum, but be sure to check what they are.
For more information on plan costs, or for questions about specific details of the plan, you can contact your local SHIP agency or check out Medicare.gov.