Nearly every American 65 or older turns to Medicare for help to pay for healthcare. Traditional Medicare relies on two components: Part A coverage for hospital and inpatient care, and Part B coverage for doctor visits and outpatient treatment.

Every year, changes to Medicare affect those who rely on the program for their financial security during their retirement years. Let's take a closer look at the latest for Part B in 2021.

Medicare Part B coverage

Medicare Part B covers most care for which you do not need to be admitted to a hospital or other treatment facility. That includes routine doctor visits as well as outpatient surgery. You'll also turn to Part B for a host of needs ranging from medical equipment and ambulance transportation to diagnostic testing and treatment for mental health issues.

Stethoscope, calculator, pen, and benefits explanation.

Image source: Getty Images.

Part B covers a couple different types of care. Medically necessary conditions are generally covered, with services used to help detect, diagnose, and effectively treat a medical condition or disease. However, there are also preventive care services that fall under Part B, including an initial intake when you turn 65 and annual checkups to follow up and make sure you're still healthy.

Medicare Part B isn't totally comprehensive in its coverage. Many older patients need dental care, eye exams for glasses or contact lenses, and hearing aids, and Part B generally doesn't cover those. In addition, some less universally accepted treatment options don't qualify for Medicare reimbursement, leaving it up to you to cover those costs.

Medicare Part B costs are headed higher in 2021

To get Part B, you have to pay monthly premiums. Most people will pay $148.50, which is up $3.90 per month from 2020. The increase would have been significantly higher had it not been for a special legislative provision that Congress passed to limit the increase.

Medicare looks back two years at your income in deciding whether you need to pay higher monthly premiums for Part B. The table below shows the income levels that correspond to 2019 income, in determining Part B premiums for 2021. You might owe as much as $504.90 in monthly premiums.

For Individuals With This Income:

Or Joint Filers With This Income:

Total Monthly Premium in 2020 Will Be:

$88,000 to $111,000

$176,000 to $222,000

$207.90 (up $5.50)

$111,000 to $138,000

$222,000 to $276,000

$297 (up $7.80)

$138,000 to $165,000

$276,000 to $330,000

$386.10 (up $10.10)

$165,000 to $500,000

$330,000 to $750,000

$475.20 (up $12.50)

Over $500,000

Over $750,000

$504.90 (up $13.30)

Data source: Centers for Medicare & Medicaid Services. Note: Married persons filing separately who lived together at any time during the year pay $475.20 if their income is $88,000 to $412,000, or $504.90 if their income is more than $412,000.

There are also two other things Medicare Part B participants have to pay. First, a deductible of $203 applies in 2021, which is $5 higher than it was in 2020. You'll need to pay that amount before Part B coverage starts to pay its share. Also, Medicare covers only 80% of costs for most items. You need to pay the other 20%.

Be smart about your health

To keep yourself healthy, you'll need healthcare in retirement, and Medicare Part B is a key part of making it affordable. What you'll pay for coverage could save you from facing bills you'd never be able to pay without it -- so make sure you know everything you're entitled to receive from the federal program.