When you enroll in Medicare and get Original Medicare, you usually must sign up for Medicare Part B. Although you may have premium-free Part A, you will have to pay monthly premiums to get Part B coverage. There are certain aspects that affect how much you have to pay. In this article, we will explain what you need to know about Medicare Part B costs.
Monthly premiums of Medicare Part B
Whether you get Medicare Part B automatically or you have to sign up for it, you will have to pay monthly premiums to get the coverage. You will get a bill to pay the monthly premium unless you have certain benefit payments, which apply if you get Social Security, Railroad Retirement Board of Office of Personnel Management benefits. In those three cases, you won’t get a bill and your monthly premium will be automatically deducted from your benefit payment.
Most people pay the standard premium monthly amount, which is $134 in 2018. However, some people who get Social Security benefits pay a lit bit less, $130 on average.
How much you have to pay will also depend on your modified adjusted income. If it is above certain amount, you will pay an Income Related Monthly Adjustment Amount (IRMAA). This means that you will have to pay the standard premium amount plus the IRMAA. To calculate your IRMAA, Medicare will use the modified adjusted gross income report on your IRS tax return from two years ago, which is the most recent provided to Social Security by the IRS.
You pay the standard amount of $134 or higher (depending on your modified adjusted income) if you enroll for Part B for the first time in 2018, you don’t get Social Security benefits, you are directly billed for your Part B premiums, your modified adjusted gross income is above a certain amount or you have Medicaid and they pay for your premiums. In the last case, your state will pay the standard premium amount of $134 because you have Medicaid.
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How much do I have to pay depending on my Modified Adjusted Gross Income (MAGI)?
In 2018, the monthly premium amounts depending on your Modified Adjusted Gross Income (MAGI) are the following:
- If your MAGI is $85,000 or less, or you are a married couple with a MAGI of 170,000 or less, you only pay the standard premium of $134.
- If your MAGI is above $85,000 up to $107,000, or you are a married couple with a MAGI above $170,000 up to $214,000, you pay the standard premium of $134 plus $53.50.
- If your MAGI is above $107,000 up to $133,500, or you are a married couple with a MAGI above $214,000 up to $267,000, you pay the standard premium of $134 plus $133.90.
- If your MAGI is above $133,500 up to $160,000, or you are a married couple with a MAGI above $267,000 up to $320,000, you pay the standard premium of $134 plus $214.30.
- If your MAGI is above $160,000, or you are a married couple with a MAGI above $320,000, you pay the standard premium of $134 plus $294.60.
In case you disagree with the amount you have to pay, you have the right to appeal the decision.
In case your income goes down and that could make a difference in how much you pay, contact Medicare.
Part B late enrollment penalty
If you don’t enroll to Medicare Part B when you were first eligible, your monthly premium will go up 10% for each 12-month period that you could have had Part B, but didn’t sign up for it. You will have to pay the Part B late enrollment penalty for as long as you have Part B.
Part B Deductibles and Coinsurance
Part of Medicare Part B costs are deductibles and coinsurances. Your deductible will be $183 per year. After you pay your deductible, you pay 20% of the Medicare-approved amount (coinsurance) for most doctor services, outpatient therapy and durable medical equipment.