The Cost of Medicare Coverage


Paying for Medicare coverage works a little differently then how we paid our health insurance premiums during our working years. While most of us have paid one large premium for all of our healthcare coverage (Doctor, hospitalization, and drug coverage) during our working years, Medicare coverage is paid in several smaller amounts for individual parts of coverage.


Medicare Cost for Part A for 2020


Typically, there is no cost associated with Medicare Part A (Hospital Insurance). As long as you have worked and paid taxes for at least 10 years (40 quarters) you will be entitled to Part A at no cost. Often times, you will hear people refer to this also as “premium-free Part A”. You may also be eligible for Part A at no cost if your spouse has met the previously mentioned requirements.

​If you have to buy Part A, you will pay up to $458 per month in 2020. People with less than 40 quarters work experience but more than 30 quarters can get a pro-rated premium of $252 per month in 2020. 

Should you have a hospital stay in 2020, you Part A deductible will be $1,408 (However, if you have a Medicare Supplement Plan, it will most likely cover this cost for you).


Medicare Costs for Part B for 2020


Premiums for Medicare Part B are based upon your modified adjusted gross income (MAGI) from 2 years ago; since this is the most recent tax return information provided to Social Security by the IRS.  Items that contribute to your MAGI include: wages, interest, required minimum dividends from investments, capital gains, Social Security benefits, and tax-deferred pensions.

The Medicare Part B premium for 2020 is $144.60 for those who are:

  • Not collecting Social Security benefits
  • Enrolled in Part B for the first time in 2018
  • Part B premiums are paid by Medicad

For the most part, you will pay the standard Part B premium.  However, if your income is over $87,000 (single) or $174,000 (married couple), then you may pay an Income Related Monthly Adjustment (IRMAA).

Your Part B premium will automatically be deducted from your benefit payment if you receive any of the following benefits:

  • Railroad Retirement Board
  • Social Security
  • Office of Personnel Management

Is there anything else for Part B that I have to pay for besides the monthly premium?

The Medicare Part B deductible for 2020 is $198. After you met your deductible, Medicare pays 80% of any Part B approved services. You are responsible for paying the remaining 20%. Medicare Part B covers the most frequently used services such as:

  • Most doctor services such as doctor visits, lab tests, x-rays, and other services received outside of the hospital
  • Outpatient Therapy
  • Durable Medical Equipment (DME)

One very important thing to remember is there is no cap on your out-of-pocket costs under Medicare Part B, which means if your total bill was $100,000, you would owe $20,000 or more as the bill rises.

See the chart below to find out what your premium will be in 2020.


Medicare Cost for Part D for 2020


Most Medicare Part D plans charge a monthly premium that varies by plan carrier. If you are enrolled in an Medicare Advantage Plan, or a Medicare Cost Plan that includes Medicare prescription drug coverage, your prescription drug coverage will most likely be included in your monthly premium, and in some Part C plans, there will not be a premium. You can find plans that start around $10 – $15 per month in most states. This is the base premium for Part D.

If you have a high income you may pay an extra amount on top of your standard plan premium. Just like with Part B of Medicare, if you make over $87,000 as an individual or over $174,000 if you file your taxes jointly then you will pay an Income Related Monthly Adjustment Amount also called an IRMAA. Below is a chart that will tell you the extra amount you may have to pay based on your income.



If you find this all a little confusing then don’t worry… your not alone! Our Medicare experts can help you understand exactly what you will pay for each part of your Medicare coverage. We can help you determine your premiums right over the phone. Simply give us a call or click the button below and one of our licensed agents will give you a call to to assist you.

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