What Medicare Options Are Available If You Live In California?
- Throughout the U.S., including the state of California, the cost of Original Medicare is standardized.
- If you are a California resident, you have two main choices for Medicare coverage: Original Medicare (federally-managed), or Medicare Advantage (provided by private companies that contract with Medicare).
- Medicare Advantage plan costs vary widely and serve as an alternate form of coverage if Original Medicare doesn’t meet your healthcare needs.
- Medicare Supplement and prescription drug plans can fill gaps left by your Original Medicare coverage.
As an eligible California resident, it is important to understand your Medicare options. As of December 2018, California had over 6.1 million people enrolled in Medicare. According to The Centers for Medicare and Medicaid Services, 57.3% of enrollees opted to enroll in Original Medicare. Around 42.7% enrolled in Medicare Advantage and other plans.
Original Medicare in California
Original Medicare (Part A and Part B) is standardized across the nation and is directly managed by the federal government.
- Medicare Part A, or hospital insurance, covers inpatient hospital stays, skilled nursing facility care, hospice, and certain home health aid.
- Medicare Part B, also known as medical insurance, covers physician visits, medical supplies, outpatient care and preventive care.
- Medicare Part D is prescription drug coverage that can be added to your Original Medicare coverage.
- Medicare Supplement Insurance, or Medigap, is sold by private companies. As of 2020, there are 10 standard Medigap plans offering varying levels of coverage (A, B, C, D, F, G, K, L, M and N). If you became eligible for Medicare after January 2020, none of the plans available cover the Part B deductible, and Plan C and Plan F are no longer available to new enrollees in 2020.These plans help pay your copayments, coinsurance, and deductibles not covered by Original Medicare. However, it is important to note that Medigap does not cover dental, vision, hearing care, long-term care or private duty nursing.
Original Medicare does not cover prescription drugs, dental, vision or hearing care, but other plans, like Medicare Advantage and prescription drug, and Medicare Supplement plans are available to fill these gaps in your coverage.
Cost of Original Medicare in California
In California and the U.S. in general, your Original Medicare costs at a glance will look like the chart below, assuming that you:
- Are buying Part A
- Have spent less than 60 days in the hospital
- Make $87,000 or less annually by yourself, or
- Make less than $174,000 jointly with a spouse
|Part A monthly premium||Part A hospital inpatient deductible||Part B monthly premium||Part B deductible|
Part A Premium — You do not have to pay the Part A premium if you have paid at least 40 quarters (10 years) in Medicare taxes. If you paid Medicare taxes for 30-39 quarters, your standard Part A premium for 2020 is $252. The maximum Part A premium you will pay if you paid Medicare taxes for less than 30 quarters is $458.
Part A Deductible and Coinsurance — When you are admitted to the hospital, your deductible will be $1,408. Your resulting coinsurance will vary according to the length of your hospital stay. For the first 60 days of your hospital stay, you will not owe any coinsurance. This cost increases to $352 per day from the 61st-90th day spent in the hospital. After using these first 90 days for your hospital stay, you have an additional 60 days in your plan to draw from. This extra period is called your store of “lifetime reserve days.” The coinsurance for these days rises to $704 beginning with your 91st inpatient day.
Part B Premium — Your monthly premium will be more than $144.60 if your income tax return indicates more than $87,000 income (filed individually), or more than $174,000 per year when filed jointly. You can view the full income-based premium chart at Medicare.gov.
Part B Coinsurance and Deductible — Your Part B deductible for 2020 is $198. Once you have met your annual deductible, you will then be responsible for covering 20% of amounts approved by Medicare. These costs may include inpatient doctor services, outpatient therapy, and medical equipment.
Medicare Advantage in California
Medicare Advantage (Part C) is provided by private companies that contract with Medicare. Instead of Original Medicare, you may opt for an all-inclusive Medicare Advantage plan. At a minimum, these plans must have the same coverage as Part A and Part B.
Beyond that, they usually provide bundled combinations of:
- Prescription drugs
- Preventive care
- Wellness care
Additionally, these plans may offer benefits like transport to doctor visits, adult day care, and over-the-counter drugs.
Most Part C plans provide Health Maintenance Organization (HMO), or Preferred Provider Organization (PPO) insurance plans. With an HMO plan, you may only use in-network doctors and hospitals. In contrast, PPOs usually let you see some out-of-network providers, according to the plan’s terms and conditions.
Cost of Medicare Advantage Plans in California
The cost of Medicare Advantage plans vary widely. We sampled four top plans in San Francisco Bay Area counties that bundle health and drug costs. These plans ranked highly according to lowest drug and health premiums, customer experience, preventive care, and how well they manage chronic conditions.
Although they bundle prescription drugs, dental, vision, and hearing benefits, none of these plans charge a premium or deductible in 2020. Below we have outlined maximum costs you will pay if you receive care from providers within these plans’ networks:
- Anthem MediBlue StartSmart Plus (HMO) — $3,400 in-network plan maximum
- Alignment Health Plan My Choice (HMO) — $3,400 in-network plan maximum
- Health Net Healthy Heart (HMO) — $3,400 in-network plan maximum
- Anthem MediBlue Care On Site (HMO I-SNP) — $3,000 in-network plan maximum
- SCAN Options (HMO) — $3,400 in-network plan maximum
Although these plans do not charge premiums, you will still pay your standard Medicare Part B premium which starts at $144.60.
With an HMO plan, you may only use in-network doctors and hospitals. PPOs usually let you see some out-of-network providers, according to the plan’s terms and conditions.
Cost of Medigap Plans in California
Although Medigap plan benefits are standardized, their costs vary based on your:
- Zip code
- Age (premiums of the plan you buy will not change with age, but the cost may be adjusted for inflation).
- Level of coverage, which may include:
- Skilled nursing facility stay
- Foreign travel emergencies
- Insurance company