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What Is the Out-of-Pocket Maximum with Medicare? 

If you are in the process of considering your Medicare options, out-of-pocket costs may have become a potential factor in your final decision. Medicare Part A and Part B do not have an out-of-pocket maximum. However, this does not apply to the Medicare Advantage plans, which do have an out-of-pocket maximum. We’ve compiled a list of what you need to know when it comes to out-of-pocket maximums and how they affect the Medicare options available to you.  

General Medicare Out-of-Pocket Maximum 

As mentioned previously, there is no current out-of-pocket maximum under the Original Medicare which can lead to other costs instead. If you are under the Original Medicare, you are responsible for the Part B annual deductible, a Part A deductible for each benefit period (a new benefit period can be started every 60 days, leading to multiple benefits in a year), and your coinsurance and copayment amounts.  

Medicare Advantage Plans 

Original Medicare and Medicare Advantage plans work differently from each other. Medicare Advantage plans are offered solely from private insurance companies that are approved by Medicare. This means that these private insurance companies are meeting the standards and requirements in place by Medicare. In addition to this, as soon as these companies meet the minimum requirements for coverage under Medicare rules, the companies now have the ability to set their own premiums, benefits, and cost-sharing structures. Typically, Medicare Advantage plans will utilize a network of proffered providers, which means that your direct out-of-pocket costs will be lower when you use the providers listed in the network selected. This doesn’t mean that you can’t use other providers. Some of these plans allow you to continue receiving care from any provider outside of the network that is listed to accept your plan. The catch to this option is that these services are considered out-of-network and can lead to a higher out-of-pocket cost if you do decide to go that route.  

As of 2021, the Medicare out-of-pocket maximum for Medicare Advantage plans is $7,550 for in-network expenses and $11,300 for combined in-network and out-of-network expenses. Once you and your family have reached the out-of-pocket maximum, your plan will then pay 100% of the expenses on covered medical services for the remainder of the year.  

Want to learn more about out-of-pocket maximums with Medicare? Reach out to your local agent today for more information.