What is Medicare Part B?

What does Medicare Part B cover?

In a short phrase, Medicare Part B covers two types of medical services — preventive services needed to detect and keep potentially severe diseases from advancing and medically necessary services needed to treat a disease or condition.

The connection between prevention and reducing treatment costs became more certain when the Affordable Care Act added new areas of prevention, testing, and screening to Medicare coverage.

Following this, Medicare subscribers got additional coverage at no cost including valuable lab work, diagnostics, and follow-up procedures.

With that in mind, the key concept in improving national health and reducing healthcare costs is that maintaining preventive wellness is preferred to treatment of disease.

Medically Necessary Services

To be sure, medical experts and doctors will determine what is needed to diagnose and treat a disease or condition.

Current standards of medical practice define the appropriate services and supplies to diagnose or treat an illness or condition. Those services and supplies are then considered medically necessary.

In effect, by addressing medical necessity, Part B medical insurance covers the services and items proven to be effective for patients.

With each passing year, standards of care continue to expand as new clinical research and technological innovations arise.

Preventive Services

In brief, preventative services include screenings and tests.

Primarily, early detection and treatment efforts help diminish the impact of severe disease — including untreated mental illness, alcohol abuse, and drug addiction.

Medicare Part B contributes greatly to the national effort to limit the impact of severe disease through early detection and treatment.

Not only does Part B reduce costs with preventive services, it also promotes the social medicine concepts of community wellness and availability of health education resources.

Part B Medical Insurance Coverage

Outpatient care, ambulance services and durable medical equipment form the foundation of complete medical care under Part B.

Inherently, to keep the standards of care current, Part B covers clinical research. Likewise, this capacity has proven a powerful tool for innovation in medical care.

With that said, Part B may cover some costs in certain qualifying clinical research.

Clinical research uses diagnostic tests, surgeries, medicines, or other types of care to find which treatment benefits patients in the greatest way.

Treating Mental Illness As We Treat Physical Illness

Overall, the philosophy of Medicare is to treat mental illness as any other physical condition.

In general, Part B covers the following mental health screenings and care categories:

• Part B can cover follow-on care related to a hospital stay in fields like detoxification and treatment for drug and alcohol addictions.
• Outpatient treatment services under Part B are an important resource to combat mental illness and addiction.
• Partial hospitalization can be essential for treating mental health issues. It offers a more intense focus than counseling and other outpatient therapies; it is a mode of choice when treatment does not require overnight hospitalization, but symptoms are acute.

How do I get Part B coverage?

For most, the Initial Enrollment Period (IEP) is the first opportunity to sign up.

Eligibility to apply during the IEP is based on age, and it is a seven-month period surrounding the 65th birthday month.

Generally, people can sign up for Medicare Parts A and B:

• Up to three full months before the 65th birthday month,
• During the 65th birthday month, and
• Up to three full months after the 65th birthday month ends.

What do I do after the IEP?

After the Initial Election Period (IEP), the next opportunity may be the General Enrollment Period (GEP) for Medicare Part B — from January 1st through March 31st each calendar year.

If past your IEP window of opportunity, signing up for Part B during the GEP will mean coverage begins on the first day of July of that year.

Should this option be taken, an applicant may have to pay a late enrollment penalty depending on how long they remained uncovered.

In light of any significant change in life circumstances, Medicare can provide what is known as a special enrollment period (SEP).

For example, change of address, loss of employer or union-sponsored coverage, natural disasters, or gain or loss of state Medicaid would each allow for an SEP.

If a special enrollment period is applicable, a person can avoid paying a late fee and sign up within the time frame of that special enrollment period.

Importantly, when a special enrollment period has been used to apply, coverage will start the very next month.

What Affects Out-of-Pocket Costs?

In Medicare health insurance, out-of-pocket costs have three primary sources:

1. The annual deductible amount. In 2021, the deductible is $203.
2. Charges beyond what the insurance pays for covered services and items, or coinsurance, defined as 20% percent of the Medicare-approved amount.
3. Services or items that Medicare does not actually cover.

Officially, the Medicare-approved amount is the maximum that can be charged by a provider who accepts assignment from Medicare.

Under Part B, this applies to doctor services, outpatient therapy and durable medical equipment, like oxygen tanks and wheelchairs.

Formerly, out of pocket costs had no limits. Then, health plans were reformed through the Affordable Care Act (ACA).

This reform added many free services to Medicare, particularly in prevention, to include annual screenings, tests, and mental health coverage.

Following suit, the services and support activities defined as essential health benefits with no additional charge have positively effected out-of-pocket costs.

Is there a Late Enrollment Penalty for Part B?

It’s helpful to be aware that those who delay sign up for Medicare Part B could face a penalty.

The Part B late penalty is multiplied by the number of full years a person went without coverage, but was eligible.

The penalty lasts for as long as the applicant has Part B,  as follows below:

• Penalty – Up to ten percent increase in monthly premiums per Term
• Term – 12 month period one could have had, but did not have Part B coverage

However, if a late enrollment penalty normally applies, people with special enrollment periods can avoid it.

Likewise, those with limited income can get relief from the state government to pay Part A and or B in the form of Medicaid.

At the same time, they may also get relief from Social Security’s Extra Help program to pay for prescriptions when they use their Part D or Medicare Advantage Prescription Drug plan.