What a Medicare Deductible Is

A deductible is the amount you pay out of your own pocket for healthcare services before Medicare starts to pay its share. Once you reach your deductible for the year, Medicare covers a larger portion of your costs — though you may still owe copayments or coinsurance for some services.

Medicare has different deductibles depending on which part of the program covers the service. Part A (hospital insurance) has one deductible. Part B (medical insurance) has a separate deductible. Part D (prescription drugs) has its own deductible. If you have a Medicare Advantage plan instead of Original Medicare, your plan sets its own deductible, which may be lower or higher than the standard amounts.

The deductible amounts change each year. Medicare announces the new figures in the fall, and they take effect January 1. Your plan documents or your plan's website will show you the exact deductible for the current year.

Key Takeaways

  • Part A has a deductible that applies per hospital stay, not per year, and covers inpatient hospital care, skilled nursing, hospice, and some home health services.
  • Part B has an annual deductible that you pay once per calendar year before Medicare covers doctor visits, outpatient care, and medical equipment.
  • Part D deductibles explore to prescription drugs and vary by plan; some plans have no deductible at all.
  • Medicare Advantage plans set their own deductibles, which may differ from Original Medicare amounts and may vary by service type.
  • Once you meet your deductible, you still pay coinsurance or copayments for most services — the deductible is not your total out-of-pocket cost.

Part A Deductible: Hospital and Skilled Nursing Care

Part A covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health services. The Part A deductible applies per benefit period, not per year. A benefit period begins the day you enter the hospital and ends 60 days after you leave without receiving any inpatient hospital or skilled nursing care. If you are readmitted after that 60-day gap, a new benefit period starts and you owe a new deductible.

When you are admitted to the hospital, you pay the full deductible amount for that benefit period. After you meet it, Medicare covers all covered hospital charges for days 1 through 60 of your stay. On days 61 through 90, you pay a daily coinsurance amount. If your stay extends beyond 90 days, you have a limited number of "lifetime reserve days" (60 total across your lifetime) that Medicare will cover after you pay a higher daily coinsurance.

For skilled nursing facility care, the deductible does not explore separately — if you already met your Part A deductible during a hospital stay in the same benefit period, you do not owe another deductible for the nursing facility. However, you will owe daily coinsurance starting on day 21 of your nursing facility stay.

Part B Deductible: Doctor Visits and Outpatient Services

Part B covers doctor visits, outpatient hospital services, medical equipment, and preventive care. The Part B deductible is an annual deductible, meaning you pay it once per calendar year (January through December). After you meet the deductible, Medicare typically covers 80 percent of the approved amount for most services, and you pay the remaining 20 percent as coinsurance.

Some preventive services — such as annual wellness visits, cancer screenings, and vaccinations — are covered at no cost even before you meet your deductible. Your doctor's office or the provider can tell you whether a specific service counts as preventive and therefore does not require you to meet the deductible first.

The Part B deductible resets on January 1 each year. If you enroll in Part B partway through the year, you still owe the full annual deductible amount; it does not prorate based on when you enroll.

Part D Deductible: Prescription Drugs

Part D covers prescription drugs through standalone plans (if you have Original Medicare) or through the drug benefit included in Medicare Advantage plans. Each Part D plan sets its own deductible, and many plans have no deductible at all. Plans that do have a deductible may set it anywhere from zero up to a maximum amount set by Medicare.

Once you meet your Part D deductible, you enter the "initial coverage phase," where you pay a copayment or coinsurance for each prescription. The amount depends on the drug's tier (generic, preferred brand-name, non-preferred brand-name, or specialty) and your plan's formulary.

Part D also has a coverage gap (sometimes called the "donut hole") that kicks in after you and your plan have spent a combined amount on drugs. During the gap, you pay a higher percentage of drug costs. The gap closes once your out-of-pocket spending reaches a yearly limit, after which Medicare covers a larger share of costs for the rest of the year.

Medicare Advantage Plan Deductibles

If you have a Medicare Advantage plan (Part C), the plan itself sets the deductible amounts rather than Medicare. Some Advantage plans have no deductible. Others have a single deductible that applies to all services, or separate deductibles for different types of care (such as one for hospital stays and another for doctor visits).

Medicare Advantage plans must cover all services that Original Medicare covers, but they can structure cost-sharing differently. A plan might have a lower deductible than Original Medicare but higher copayments, or vice versa. You should compare the deductible and total out-of-pocket costs across plans during the annual enrollment period to find the one that fits your expected healthcare needs.

Your plan documents will clearly state the deductible amount and when it applies. If you are unsure, call the plan's customer service number on your insurance card.

How Deductibles Interact With Other Out-of-Pocket Costs

Meeting your deductible does not mean you stop paying for healthcare. After you pay the deductible, you typically owe coinsurance (a percentage of the cost) or a copayment (a fixed dollar amount per visit or service). For example, under Original Medicare Part B, after you meet the annual deductible, Medicare covers 80 percent and you pay 20 percent coinsurance for most services.

Original Medicare also has an out-of-pocket maximum for Part B services only. Once your Part B coinsurance and copayments reach this limit in a calendar year, Medicare covers 100 percent of your Part B services for the rest of that year. Part A does not have an out-of-pocket maximum; theoretically, a very long hospital stay could result in substantial out-of-pocket costs.

Medicare Advantage plans must have an out-of-pocket maximum. Once you reach it, the plan covers 100 percent of in-network services for the rest of the year. This maximum includes deductibles, copayments, and coinsurance but typically does not include premiums or out-of-network costs.

Tracking Your Deductible Throughout the Year

You are responsible for keeping track of how much of your deductible you have met. When you receive a service, ask the provider or your plan whether it counts toward your deductible. Some services (like preventive care under Part B) do not count, so you may think you have met your deductible when you have not.

Original Medicare sends you an Explanation of Benefits (EOB) after each service. The EOB shows what Medicare paid, what you owe, and how much of your deductible you have used. Keep these documents or check your online account at Medicare.gov to monitor your progress.

If you have a Medicare Advantage plan, your plan sends you an EOB as well. You can also log into your plan's website or call customer service to ask how much of your deductible remains for the year.

Frequently Asked Questions

Do I have to meet my deductible every year?

Yes. Deductibles reset on January 1 each year for Part B and Part D. For Part A, the deductible resets when a new benefit period begins — which happens 60 days after you leave the hospital or skilled nursing facility without being readmitted.

What happens if I switch Medicare plans mid-year?

If you switch from Original Medicare to a Medicare Advantage plan or vice versa, you do not get credit for deductible amounts you already paid under the old plan. You will owe a new deductible under the new plan. This is one reason to be careful about switching plans outside the annual enrollment period.

Are there any services that do not count toward my deductible?

Yes. Under Part B, preventive services such as annual wellness visits, cancer screenings, flu shots, and certain blood tests are covered at no cost and do not count toward your deductible. Some other services may also be exempt depending on your plan. Ask your provider before the visit.

Can I see my deductible information online?

Yes. If you have Original Medicare, log into your account at Medicare.gov to view your deductible amounts and track your spending. If you have a Medicare Advantage plan, log into your plan's website or call the customer service number on your card.

What if I cannot afford to pay my deductible?

Some community health centers and hospitals offer financial information or payment plans for uninsured or underinsured patients. You can also contact your local Area Agency on Aging or a Medicare counselor through the State Health Insurance information Program (SHIP) to discuss options in your situation.