The number of U. S. citizens age 65 and older has grown from 3.1 million in 1900 to 35 million in 2000 and from 53.7 million in 2018 to 55.4 million in 2019. This trend foretells the increasing reliance of the aging population on the U.S. health care system, while treatments grow more costly over time.
Due to these facts, Medicare Parts A, B, C, and D are of great significance to seniors, who are particularly well served by Part B, the cost of which is typically deducted from your Social Security check.
Part B Coverage
Part B covers a lot of what's considered medically necessary services such as doctor visits, tests, injected drugs, medical equipment, ambulances and lab work. Also covered are physical therapy, outpatient surgeries, preventive care and screenings as well as other non-hospital services.
Part B Enrollment
You should sign up for Part B during the Initial Enrollment Period in the year you turn 65 unless you continue to work and rely on either the health coverage that your employer provides or that of your working spouse. If you wait until the day you turn 65 to enroll, or delay your enrollment well after you reach that age, your Part B coverage will be delayed. In either case, the delay may cause a gap in your coverage and an increase in your premium.
When you enroll, the Social Security Administration (SSA) manages the process. You can enroll in person, online or by mail.
If you begin receiving Social Security at age 62, Medicare enrollment occurs automatically when you become 65. Otherwise, you’ll receive Medicare coverage only if you complete the necessary forms.
Part B Cost
All retirees who enroll in Medicare Part B must pay a monthly premium for coverage. Medicare bases that premium on your income. In 2020, an individual who earns $87,000 or less will pay a standard Part B monthly premium of $144.60. In contrast, if your income is $500,000 or more, your premium is $491.60. For people with low incomes, assistance with the monthly premiums is available. Any penalty for late enrollment in the program increases these amounts.
Once you enroll in Part B, Medicare’s administrator, the Centers for Medicare and Medicaid Services, can deduct the premium automatically from your Social Security benefits payment. If you prefer, they can bill you.
Late Enrollment Penalty
If you're not covered by an employer-provided plan and don't sign up for Medicare Part B either three months before or three months after you reach age 65, you'll pay a late enrollment penalty. That penalty amounts to 10 percent of the standard monthly premium for each year you were eligible for Medicare Part B but did not enroll. You pay your premium along with the penalty each month as long as you are enrolled in Part B.
If you continue to work after you reach age 65 and remain enrolled in an employer-provided insurance plan, you won't face a penalty as long as you enroll for Medicare Part B within eight months after your insurance or work ends.
Read More: Traditional Medicare vs. Medicare Advantage
Health costs have climbed as an aging population makes greater use of medical services funded in part by the Medicare program. Some of these costs are due to new medical technology related to hospital stays that are paid by Medicare Part A and expensive prescription drugs covered by Part D of traditional Medicare. Still other costs relate to services paid for by Medicare Part B.
- United States Census Bureau: 65 and Older Population Grows Rapidly as Baby Boomers Age
- News Break: 65 & Older Population Grows Rapidly as Baby Boomers Age
- Medicare.gov: What Part B Covers
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- Medicare.gov: Enrolling in Medicare Part A and Part B
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- Medicare.gov: Part B Late Enrollment Penalty
- CMS.gov: Centers for Medicare and Medicaid Services
- Medicare.gov: The Official U.S. Government Site for Medicare
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- CMS.gov: Deciding Whether to Enroll in Medicare Part A and Part B When You Turn 65
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- U.S. Centers for Medicare & Medicaid Services. "Medicare Savings Program." Accessed July 16, 2020.
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- U.S. Department of Health and Human Services. "Who Is Eligible for Medicare?" Accessed July 16, 2020.
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- Centers for Medicare & Medicaid Services. "2020 Medicare Parts A & B Premiums and Deductibles." Accessed July 16, 2020.
- Centers for Medicare & Medicaid Services. "Trump Administration Drives Down Medicare Advantage and Part D Premiums for Seniors." Accessed July 16, 2020.
- Social Security Administration. "Workers with Maximum-Taxable Earnings." Accessed July 16, 2020.
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- U.S. Congress. "H.R. 748 -- CARES Act." Accessed July 16, 2020.
Billie Nordmeyer is an IT consultant of 25 years standing. As a senior technical consultant for SAP America and Deloitte Touche DRT Systems, a business analyst, senior staff, and independent consultant, Billie has worked across the retail, oil and gas, pharmaceutical, aeronautics and banking industries. Billie holds a BSBA accounting, MBA finance, MA international management as well as the Business Analyst and Software Project Management certificates from the Cockrell School of Engineering at the University of Texas at Austin.