If you have Medicare, you know there are changes every year. The Centers for Medicare and Medicaid Services (CMS) provides information about new things for the upcoming year. This can include changes to your benefits, coverage, and how much you pay out of pocket.
1. What Are the 2021 Changes for Medicare?
Here is a quick rundown of the changes you can expect in 2021. People with Medicare will pay more every month for Medicare Part B. The cost of Medicare Part D, or prescription drug coverage, will go down. And if you take insulin, you will pay only $35 a month for it in 2021. Medicare Advantage members will see several changes. They will pay less for their monthly premiums. They will also have more choices for virtual doctor visits — what’s known as “telehealth” — more options for long-term care coverage, and new benefits if they have end-stage renal disease (ESRD).
2. What You Need to Know
For 2021, you can expect the following Medicare changes:
- Medicare Part B will cost more. Your monthly premium may go up by about 6%. Congress is working on a law that may lower how much your premiums go up.
- Medicare Advantage will cost less. Changes in these plans mean you will pay less every month. You will also have more options for virtual doctor visits. Other changes include more long-term care benefits and expanded ESRD coverage.
- Cheaper drugs will lower monthly costs for Medicare Part D insurance. Also, people who take insulin will pay no more than $35 a month.
3. What Are the 2021 Changes for Original Medicare?
Original Medicare, also known as Medicare Part A, remains free for most people. The standard Part B premium for 2020 is $144.60. Medicare.gov has not yet said how much premiums will be for 2021.
Part B premiums generally go up every year. In April, Medicare trustees said they thought premiums would go up around 6%. That would mean your costs per month could go from $144.60 in 2020 to about $153 in 2021.
The report came out before the coronavirus spread across the U.S. Why does that matter? Because of the timing, the report doesn’t account for the economic fallout from COVID-19. A proposed bill in Congress may make the increase in costs in 2021 much smaller.
4. What Are 2021 Changes for Medicare Advantage?
Here are the changes you can expect to see in Medicare Advantage plans for 2021.
Lower premiums, more plans
If you have a Medicare Advantage plan, you can expect to pay 11% less per month for it in 2021 than you paid in 2020. If your plan cost $23.64 a month in 2020, you’ll pay $21 in 2021. According to CMS, this is the lowest cost in 14 years.
You will also have more options for Medicare Advantage plans. The number of plans per county will increase from 39 in 2020 to 47 in 2021.
2020 saw a dramatic rise in telehealth visits. States ordered people to stay home to prevent the spread of COVD-19. The typical in-person visit to the doctor was discouraged or impossible. Instead, doctors and health plans turned to telemedicine to provide care.
Medicare Advantage plans will continue this trend. In 2021, 77% of them will offer virtual doctor’s appointments0.
CMS may also allow virtual doctor visits after the pandemic ends. Which types of visits are covered will depend on the law and on each beneficiary’s needs.
Coverage options for long-term care
Like Original Medicare, Medicare Advantage plans pay for rehabilitative care or skilled services for up to 100 days. Some plans also pay for home care if a doctor says it’s needed.
In 2021, some plans will add more supplemental healthcare benefits. These include caregiver support services, adult day health services, in-home support services and home-based palliative care. Some plans will also pay for therapeutic massage.
Coverage options for end-stage renal disease
If your kidneys don’t work, you may have end-stage renal disease (ESRD). If you do have ESRD, your options for Medicare will expand in 2021.
Beginning Jan. 1, 2021, thanks to the 21st Century Cures Act, anyone who has ESRD and is eligible for Medicare can get a Medicare Advantage plan. The new rules also change who pays for an organ for a kidney transplant.
In the past, people with ESRD could only get a Medicare Advantage plan in special cases. For example, if they got the disease while already on a Medicare Advantage plan, they could keep the plan.
5. What Are 2021 Changes to Part D and Prescription Drugs?
In 2021, you will pay less for Medicare Part D. If you are on insulin, you will also pay less per month with the new rules.
Prescription drug insurance will cost less in 2021. The monthly premium for the average basic Part D coverage will be about $30.50 in 2021. That’s $2.24 less per month than the 2020 Part D average basic premium of $32.74.
Insulin at a monthly copay of $35
Medicare patients will pay only $35 per month for insulin. Seniors can pick from more than 1,600 Medicare Advantage and Part D plans that offer this option.
The Part D Senior Savings Model will pay for different insulins, but none will cost you more than $35 per month. You can search for Part D plans with this option when signing up later this year.
6. What Are 2021 Changes for Medicare Supplement Insurance (Medigap)?
For 2021, Medigap policies will have an annual deductible of $2,370, an increase of 1.3% from the $2,340 deductible in 2020. The deductible is your out-of-pocket cost, or how much you have to pay before your insurance coverage kicks in.
CMS updates the Medigap policy deductible every year. Changes to the deductible are based on the Consumer Price Index for all Urban Consumers, which is determined by the Bureau of Labor Statistics.
One reminder: Medicare Supplement Plans C and F are only an option for people who turned 65 before January 1, 2020. If your birthday was on or after January 1, 2020, you can’t sign up for either.
7. What Proposed Medicare Changes Could Affect You?
Some proposed Medicare changes could affect the prices you pay for healthcare. For 2021, CMS proposed a change to doctor payments, lowering the physician conversion factor to $32.26. This represents a drop of $3.83 from the current rate of $36.09. This proposed change would mean doctors would get paid less for treating Medicare patients.
What providers would be affected? Doctors who do specialist surgery would get paid less. This includes payment drops for the following types of surgeries:
- Cardiac: 9%
- Thoracic: 8%
- Vascular: 7%
- Orthopedic: 5%
On the flip side, the proposed rates would pay doctors more for office visits. This includes office visits for transitional care management services, therapy evaluations, psychotherapy services and more.