Sometimes, it comes as a surprise to older folks that Medicare is not free.

Depending on the coverage you have, Original Medicare can be very costly. If you choose not to participate in a Medicare Supplement or Medicare Advantage Part C plan your out of pocket expenses could be well over 6-figures throughout your retirement.

People are genuinely surprised that even after paying Medicare taxes over several decades, they may still be responsible for premiums, copays and coinsurances.

Generally speaking, Medicare only covers about two-thirds of the cost of health-care services for the program’s 62.4 million or so beneficiaries, most of whom are age 65 or older. That’s the age when you become eligible for Medicare.

As long as you have paid at least 10 years of Medicare taxes (accumulated 40 quarters), you will not pay premiums for Medicare Part A, which, covers hospital stays, skilled nursing, hospice and some home health services.

However, if you only have Original Medicare, Part A has a deductible of $1,408 per benefit period, along with some caps on benefits.
Part B, which covers outpatient care and medical equipment, has a standard monthly premium of $144.60 this year 2020 (although higher earners pay may pay more). It also comes with a $198 deductible (for 2020) and after it’s met, you typically pay 20% of Medicare approved covered services.

Most people aren’t aware that you can mitigate these costs with a Medicare Supplement or Medicare Advantage (Part C) plan. This is where the value of a Medicare Sales Agent/Broker really shows.