Medicare What's Buzzing

Medicare costs high for older adults and people with disabilities

Written by Diane Archer

No one should think that Medicare provides more than partial health care coverage.  A new Kaiser Family Foundation report reveals high costs for people with Medicare.  Average out-of-pocket spending was $4,734 in 2010, (the most recent year for which data was available), about 20 percent of the median income of people with Medicare, $23,500. (In 2014, it’s $24,150).

The ten percent of people with Medicare with the highest costs spent an average of $19,236 in 2010 on premiums, coinsurance and services that Medicare does not cover.  People with costly conditions requiring multiple hospitalizations and long-term care incurred particularly high out-of-pocket costs.

The oldest Medicare recipients also spent significantly more out-of-pocket on health care. People over 85 spent about three times more out of pocket ($5962) than people between 65 and 74 ($1926).

Women spent more than men on average in 2010, $5036 and $4363 respectively.  Higher health care spending by women with Medicare is largely attributable to women living longer and needing long-term care, which Medicare for the most part does not pay for.

Even with Medicare, people who were hospitalized and then admitted to nursing homes had the highest documented out-of-pocket costs, which amounted to $9508. Medicare does not cover most home care or nursing home care. People with Alzheimer’s also had particularly high out-of-pocket health care costs of $8305 on average.

But the people with the largest health care bills were the people living in long-term care facilities, paying $17,534.  They spent nine times more than people with Medicare living in the community, whose average costs were $1858.

Here are three tips to plan for long-term care.



  • Great article. Most of my friends in the soon-to-be-on-Medicare age group do not understand those facts. They generally feel that once they get onto Medicare all of their health care costs will be taken care of. Little do they know.

    But the next articles should be on (1) whether Medicare Advantage (Medicare Part C) does any better, and (2) How well does Medigap fill in the holes in what regular Medicare covers.

    • Do not even consider Meducare Advantage unless you are very healthy and are very sure you will never get sick or be injured! The only “advantage” is to the private, for-profit insurance company! You will have to get permission for most treatment and may have to file appeals or beg for exceptions for treatment that would not be questioned under traditional Medicare. Never a good choice in my opinion unless you are willing to accept substandard medical care and, potentially, to pay many of your medical costs yourself. The “free” benefits you are promised can be very expensive!

  • I had a stroke when I was 55. My company luckily let me keep my health insurance until I was 62 then the company changed it to medicare supplemental. My typical yearly bill for after medicare was around 20k and the medicare supplemental picked up all but 2K a year which comes out of my SS which is sparse to say the least.
    Don’t think Medicare will pay for everything, even with supplemental it comes to a tidy sum every year.

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