I was approved for SSDI because of multiple sclerosis almost two years ago. I should become eligible for Medicare in early 2020. Is Medicare free for disability recipients, or will I have to pay premiums? If so, how much?
You are eligible for Medicare two years after your entitlement date for Social Security disability insurance (SSDI). (This is the date that your backpay was paid from; see our article on when medicare kicks in for SSDI recipients). Medicare isn’t free for most disability recipients though. There are premiums, deductibles, and copays for most parts of Medicare, and the costs go up every year. Here are the new figures for 2020, and how you can get help paying the costs.
Part A Costs
You'll have to pay a premium for Medicare Part A (hospital insurance) if you aren’t fully insured under Social Security. Generally, being fully insured means having worked 40 quarters (the equivalent of 10 years) in a job paying FICA taxes. Many disability recipients aren't fully insured because they became physically or mentally unable to work before getting enough work credits. If you (or your spouse) don’t have enough work credits, you’ll pay a premium of $458 per month, or if you (or your spouse) have between 30 and 39 credits, you'll pay a premium of $252.
If you need hospital or skilled nursing care, you’ll have to pay the first $1,408 in costs (your deductible) before Medicare will start paying anything. Once you've satisfied the deductible, the first 60 days in the hospital (or 20 days in skilled nursing care) are free. If you still need inpatient care after that, you will be responsible for the following copays.
Medicare can be quite expensive for those on disability who aren’t fully insured, but if you are eligible to be a Qualified Medicare Beneficiary (QMB) because of low-income, a Medicare Savings Program will pay your Part A premium, and possibly other costs as well.
Part B Costs
Part B pays for doctor's visits. Most people pay a Part B premium of $144.60 each month. But some people who have been on Medicare for several years will pay slightly less (about $135) if their Social Security checks are low (due to a hold harmless provision). And some people will pay more. If your adjusted gross income is over $87,000 (or $174,000 for a couple), the monthly premium can be over $400.
The Part B deductible for 2020 is $198 per year. Again, if you have low income, there are various programs that can pay your Part B premium and deductible, called Medicare Savings Programs (funded by Medicaid).
Part D Costs
Part D premiums vary depending on the plan you choose. The maximum Part D deductible for 2020 is $435 per year (though some plans waive the deductible).
There are subsidies available to pay for Part D for those with low income (called Extra Help). See Nolo’s article on Extra Help for Part D for when you are eligible.
As for the "donut hole," when Part D helps you less, in 2020 the donut hole begins after you've spent $4,020 on generic prescription drugs and ends when you've spent $6,350. You'll have to pay 25% of the cost of your drugs while you're in the donut hole.
Medicare Advantage Plans
You can often save money on Medicare costs by joining a Medicare Advantage plan that offers coverage through an HMO. Many Medicare Advantage plans don't charge a monthly premium over the Part B premium, and some don't charge copays for doctor visits and other services. Medicare Advantage plans often include prescription drug coverage, with small copays. Many Medicare Advantage Plans also offer extra benefits such as dental care, eyeglasses, or wellness programs. People entitled to Medicare due to a disability are allowed to join any Medicare Advantage plan, with the exception of those who have ESRD.
For more details on the 2020 costs of Medicare, see Nolo’s article on Medicare premiums, deductibles, and copays in 2020.