Do you have to pay for Medicare?
- Medicare Part A is hospital inpatient coverage for people with Original Medicare, whereas Part B is medical coverage for doctor visits, tests, etc.... (hospital insurance) is free for most people.
- Medicare Part B is medical coverage for people with Original Medicare. It covers doctor visits, specialists, lab tests and diagnostics, and durable medical equipment. Part A is for hospital inpatient care.... (medical insurance) is based on your annual income.
- Medicare Advantage (MA), also known as Medicare Part C, are health plans from private insurance companies that are available to people eligible for Original Medicare (Medicare Part A and Medicare Part B).... (private health plan) is the same as Part B + the insurance carrier’s additional premium amount (often $0).
- Medicare Part D (prescription drug plan) start at about $20 per month, but may have a higher premium for higher income earners.
Medicare Premium Basics
Medicare hospital insurance (Part A) is free to most beneficiaries. A premium is an amount that an insurance policyholder must pay for coverage. Premiums are typically paid on a monthly basis. In the federal Medicare program, there are four different types of premiums. ... for Medicare’s medical insurance (Part B) and Medicare Part D is Medicare's prescription drug plan program. Plans are offered by private insurance companies and cover outpatient prescriptions.... (Part D) depend on a beneficiary’s income. Beneficiaries with a higher income pay a higher premium; however, this affects less than 5 percent of Medicare beneficiaries. Beneficiaries with incomes above $85,000 per year (for a single person) and above $170,000 per year (for a married couple) pay higher Part B premiums.
To determine if a beneficiary will pay a higher premium, the Social Security Administration looks at a beneficiary’s most recent federal tax information. If a beneficiary has to pay a higher premium, the adjustment will be based on a sliding scale that is based on the Modified Adjusted Gross Income (MAGI), which is a beneficiary’s total adjusted gross income and tax-exempt interest income.
Medicare pays 75 percent of each beneficiary’s Part B premium, while beneficiaries are responsible for 25 percent. The standard Part B premium adjusts each January. The premium is higher for individuals with incomes above $85,000 per year and for married couples with incomes above $170,000 per year. A breakdown of premiums by income is available here.
- Do Medicare Part B Medical Insurance Premiums Change From Year to Year?
- How Can Beneficiaries Appeal Medicare Income Decisions?