Most people do not pay a monthly premium for Medicare Part A hospital insurance. This is because the benefit is mostly financed through the payroll taxes you paid when you were working.
Medicare Part B medical insurance and Medicare Part D drug insurance costs are different.
Most people pay $148 each month for their Part B insurance, which for convenience is automatically withheld from a person's social security check.
Very low income people typically pay less and very high income seniors usually pay more.
If you have Original Medicare and do not have a Medicare supplement insurance policy, you will be subject to a $203 annual deductible for medical care such as doctor visits, medical equipment, lab tests and more.
After paying the deductible, you will pay 20% of the cost of any Part B covered care. Keep in mind there is no annual cap on that co-insurance.
If you have a very low yearly income and qualify for your state's Medicaid program, some or all of these costs may be paid for you.
Medicare Part D drug insurance is provided through companies having a Medicare contract. Enrollees typically pay a premium plus an assortment of co-pays and co-insurance when a prescription is filled.
In 2021, the average monthly premium for Medicare drug plan coverage is $33.06. Most enrollees also have a yearly deducible.
Some people with low incomes qualify for the Part D Low Income Subsidy, also called “Medicare Extra Help”. If you are enrolled in the Extra Help program, you will pay a lower Medicare Part D premium and your drug co-pays will be less expensive.
Remember that the price you pay for a prescription medicine will depend on your plan’s approved drug list (called a formulary) and the pharmacy where you choose to fill the prescription.
Medicare Part C (Medicare Advantage) is a program through which a person's Medicare benefits are provided by a managed care company.
Most Medicare Advantage plans charge no monthly plan premium but their members continue to pay their normal Part B premium each month.
The Medicare Advantage plan gets the rest of its funding from the federal government as part of a contract awarded to them by Medicare.
If you have one of these "all in one" Medicare plans, you will pay a co-pay when you see the doctor, visit the hospital or fill a prescription at the pharmacy. Those amounts vary depending on the kind of care you receive and the place where it's provided.
Many people with Original Medicare (Part A and Part B) also purchase Medicare supplemental health insurance that pays some or all of the costs not paid by Original Medicare.
Each Medicare supplement insurance (Medigap) plan is known as a letter of the alphabet. Plan C, Plan F and Plan G pay the most but they also cost the most.
Monthly premiums vary by plan type, enrollee age and the insurance company offering the coverage. Most policyholders pay between $100 and $200 per month in addition to their normal Part B premium.
Medigap premiums typically increase as you get older. Although the premium might go up each year, your benefits will not change and you cannot be disenrolled because of your health.
Keep in mind that Medicare supplement plans only pay for care that's covered by Original Medicare; things like doctor visits and hospital care. They do not help pay for routine dental care or everyday prescription medicine because those things are not covered by the Original Medicare plan.