What Is a Medicare Copayment?

There are generally no copayments with Original Medicare — Medicare Part A and Part B — but you may have coinsurance costs. You may have a copayment if you have a Medicare Advantage plan or Medicare Part D prescription drug plan. The amount of your copayment in those cases varies from plan to plan.

Terry Turner, writer and researcher for RetireGuide
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    Terry Turner

    Terry Turner

    Senior Financial Writer and Financial Wellness Facilitator

    Terry Turner has more than 35 years of journalism experience, including covering benefits, spending and congressional action on federal programs such as Social Security and Medicare. He is a Certified Financial Wellness Facilitator through the National Wellness Institute and the Foundation for Financial Wellness and a member of the Association for Financial Counseling & Planning Education (AFCPE®).

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    Lee Williams, senior editor for RetireGuide.com

    Lee Williams

    Senior Financial Editor

    Lee Williams is a professional writer, editor and content strategist with 10 years of professional experience working for global and nationally recognized brands. He has contributed to Forbes, The Huffington Post, SUCCESS Magazine, AskMen.com, Electric Literature and The Wall Street Journal. His career also includes ghostwriting for Fortune 500 CEOs and published authors.

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  • Published: February 4, 2021
  • Updated: October 20, 2023
  • 4 min read time
  • This page features 12 Cited Research Articles
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APA Turner, T. (2023, October 20). What Is a Medicare Copayment? RetireGuide.com. Retrieved April 11, 2024, from https://www.retireguide.com/medicare/costs-and-coverage/copay/

MLA Turner, Terry. "What Is a Medicare Copayment?" RetireGuide.com, 20 Oct 2023, https://www.retireguide.com/medicare/costs-and-coverage/copay/.

Chicago Turner, Terry. "What Is a Medicare Copayment?" RetireGuide.com. Last modified October 20, 2023. https://www.retireguide.com/medicare/costs-and-coverage/copay/.

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What Is a Medicare Copayment?

A Medicare copayment is a fixed, out-of-pocket expense that you have to pay for each medical service or item — such as a prescription you receive if you have a Medicare Advantage plan or a Medicare prescription drug plan. Your Medicare plan pays the rest of the cost for the service.

Copayments are different from coinsurance. If you have Original Medicare, you typically don’t have to pay copayments. But you will have to pay coinsurance after you meet your Medicare deductible.

Difference Between Copayment, Coinsurance and Deductible
Copayment
A fixed amount of money you pay for each medical service or item, like $25 for each doctor’s visit or prescription.
Coinsurance
A percentage, such as 20% of the cost of a service or item, that you have to pay after you’ve met your deductible.
Deductible
The amount you have to pay out of pocket until your coinsurance kicks in.

Medicare Advantage plans and Medicare Part D prescription drug plans are sold by private insurers who have contracted with Medicare.

Because they are private insurers, they are able to set their own amounts for copayments. These amounts are generally based on where you live, the amount of benefits you receive and the type of plan you’ve purchased.

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Coinsurance and Copayments Under Medicare

Typically, you will be responsible for a copayment if you have a Medicare Advantage or Part D prescription drug plan. And you will have to pay coinsurance if you have Original Medicare — Medicare Part A and Part B.

Copayments and Coinsurance by Medicare Part
Medicare Part A
In 2024, you will pay no copay but will owe coinsurance for inpatient hospital stays after you reach your deductible of $1,632 for each benefit period. Coinsurance starts at $408 per day after 60 days in the hospital and increases to $816 per day after 90 days. You must pay all costs after exhausting your lifetime reserve days.
Medicare Part B
You will have no copay for outpatient services that Medicare covers. But you will have to pay coinsurance of 20% of the Medicare-approved costs for services after you meet your yearly deductible – $240 in 2024.
Medicare Advantage
Medicare Advantage plans have to cover everything Medicare Part A and Part B cover. But these plans may provide you with additional benefits including dental, vision, hearing and prescription drugs. You will have to pay any copayments associated with primary care doctor and specialist visits as well prescriptions. The amount varies according to your plan.
Medicare Part D
Your copayment will vary depending on your plan and the medications you are prescribed. Each plan uses a different formulary — or list of drugs it covers. And the drugs are arranged in tiers with different copayment or coinsurance amounts. In 2024, once you spend $5,030 on prescriptions, you will pay no more than 25% of the cost until your spending totals $8,000.

Medigap Helps Cover Medicare Copayments

There are 10 standardized Medigap plans available in most of the United States. These plans help you pay out-of-pocket costs associated with Original Medicare.

Most Medigap plans cover some or all of the costs of your Medicare Part A and Medicare Part B deductibles, copayments and coinsurance. Two of the 10 plans cover either 50% or 75% of copayment and coinsurance costs.

You cannot, however, buy a Medigap plan if you have a Medicare Advantage plan.

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Frequently Asked Questions About Medicare Copayments

How are Medicare Advantage plans able to offer zero-dollar premium copay and deductibles?
Medicare Advantage plans receive payments from Medicare for each beneficiary they enroll. The plans rely on networks of health care providers. The insurers can negotiate lower payments to these providers. You will have fewer choices of doctors, but it lowers the overall cost for the insurer, allowing it to turn a profit on the fee from Medicare while reducing the premiums it charges to $0.
What resources are available to help to cover Medicare copay costs?
Medigap plans can help with out-of-pocket costs if you have Original Medicare. A Medicare Savings Program (MSP) can help pay Medicare Part A and Part B premiums, deductibles and coinsurance. If you have limited income and resources, Medicaid or Extra Help may help cover some of your costs for medical and prescription costs.
What is the maximum copay for Medicare?
There is no cap to out-of-pocket costs in Original Medicare. The maximum out-of-pocket — or MOOP — limit set for Medicare Advantage plans in 2024 is $8,850. This includes Medicare deductibles, premiums and coinsurance. While this is the highest out-of-pocket limit for any Medicare Advantage plan, but most plans cap your out-of-pocket costs below this limit.
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Last Modified: October 20, 2023

12 Cited Research Articles

  1. National Council on Aging. (2023, October 13). What You'll Pay in Out-of-Pocket Medicare Costs in 2024. Retrieved from https://www.ncoa.org/article/what-you-will-pay-in-out-of-pocket-medicare-costs-in-2024
  2. Centers for U.S. Medicare & Medicaid Services. (2023, October 12). 2024 Medicare Parts A & B Premiums and Deductibles. Retrieved from https://www.cms.gov/newsroom/fact-sheets/2024-medicare-parts-b-premiums-and-deductibles
  3. U.S. Centers for Medicare & Medicaid Services. (2023, July 31). Center for Medicare. Retrieved from https://www.cms.gov/files/document/july-31-2023-parts-c-d-announcement-pdf.pdf
  4. U.S. Centers for Medicare & Medicaid Services. (2023, July 31). Yearly Deductible for Drug Plans. Retrieved from https://www.cms.gov/newsroom/fact-sheets/cms-releases-2024-projected-medicare-part-d-premium-and-bid-information
  5. U.S. Centers for Medicare & Medicaid Services. (2023). Costs in the Coverage Gap. Retrieved from https://www.medicare.gov/drug-coverage-part-d/costs-for-medicare-drug-coverage/costs-in-the-coverage-gap
  6. U.S. Centers for Medicare & Medicaid Services. (2022). Costs. Retrieved from https://www.medicare.gov/basics/costs/medicare-costs
  7. U.S. Centers for Medicare & Medicaid Services. (2021, November). 2022 Medicare Costs. Retrieved from https://www.medicare.gov/Pubs/pdf/11579-medicare-costs.pdf
  8. Blue Cross Blue Shield of Michigan. (2017, November 20). How Do Copays, Coinsurance and Deductibles Work With Medicare Plans? Retrieved from https://www.bcbsm.com/medicare/help/faqs/works/copays-coinsurance-deductibles.html
  9. U.S. Centers for Medicare & Medicaid Services. (n.d.). Copayment/Coinsurance in Drug Plans. Retrieved from https://www.medicare.gov/drug-coverage-part-d/costs-for-medicare-drug-coverage/copaymentcoinsurance-in-drug-plans
  10. Healthcare.gov. (n.d.). Copayment. Retrieved from https://www.healthcare.gov/glossary/co-payment/
  11. Healthcare.gov (n.d.). Coinsurance. Retrieved from https://www.healthcare.gov/glossary/co-insurance/
  12. Healthcare.gov. (n.d.). Deductible. Retrieved from https://www.healthcare.gov/glossary/deductible/