There are certain premium costs associated with Medicare Part A and Part B. In most cases, Medicare recipients don’t pay a monthly premium for Part A coverage (Hospital Insurance) – provided that the individual and / or their spouse paid Medicare taxes while they were working. Therefore, most people will receive Medicare Part A premium-free if they are age 65 and if they also meet the following conditions:
Some individuals who are under age 65 may also be able to obtain Medicare Part A without paying a premium if they have been receiving Social Security or Railroad Retirement Board disability benefits for 24 months, or they have End-Stage Renal Disease and they meet certain requirements.
If an individual is not able to obtain Medicare Part A premium-free, they can purchase it. In 2015, the monthly premium can be up to $407. In most cases, if a person chooses to purchase Medicare Part A, they must also have Medicare Part B, and pay monthly premiums for both.
In 2015, most people pay a premium of $104.90 per month for Medicare Part B. However, the premium could be higher if your modified adjusted gross income on your IRS tax return from two years prior is over a certain amount.
For example, if your 2013 adjusted gross income was above a certain amount based on the chart below, and based on the way in which you file your annual IRS tax return, then you may be required to pay a higher amount for your Medicare Part B monthly premium.
|File individual tax return||File joint tax return||File married and separate tax return||Monthly Medicare Part B premium (in 2014)|
|$85,000 or less||$170,000 or less||$85,000 or less||$104.90|
|Above $85,000 up to $107,000||Above $170,000 up to $214,000||Not applicable||$146.90|
|Above $107,000 up to $160,000||Above $214,000 up to $320,000||Not applicable||$209.80|
|Above $160,000 up to $214,000||Above $320,000 up to $428,000||Above $85,000 and up to $129,000||$272.70|
|Above $214,000||Above $428,000||Above $129,000||$335.70|
Your Medicare Part B premium may also be higher if you did not enroll in Part B when you initially became eligible for it. For instance, if you do not sign up for Medicare Part B when you are first eligible, then the premium will go up 10% for each full 12-month period that you could have had this coverage, but did not sign up for it.
If you later decide to sign up for Medicare Part B, you may be required to pay this higher premium amount for as long as you have this coverage. You must also pay an annual Medicare Part B deductible before coverage will pay out. In 2015, the amount of this deductible is $147.