What You Pay for Medicare Part B Depends on Your Income

Medicare Part B is not free for most people, but your monthly premium may be reduced or waived entirely if your income falls below certain thresholds. The standard premium changes each year — it was $164.90 per month in 2024, but the amount you actually pay depends on your Modified Adjusted Gross Income (MAGI) from two years prior. If your income is low enough, you may owe nothing at all.

The program that reduces or eliminates your Part B premium is called Medicaid, which is a separate program from Medicare. Medicaid can pay your Part B premium, your deductible, and your coinsurance if you meet your state's income and asset limits. Because Medicaid rules vary by state, what qualifies you in one state may not in another.

There is also a federal program called Medicare Savings Programs (MSP) that specifically covers Part B premiums, deductibles, and copays for people with limited income. This is different from Medicaid and has its own income cutoffs, which are higher than Medicaid's in most states.

Key Takeaways

  • Medicare Part B premiums are reduced or eliminated through Medicaid or Medicare Savings Programs, both based on your income from two years ago.
  • Medicare Savings Programs have higher income limits than Medicaid and exist in every state, though the exact income threshold varies by location.
  • You must contact your state Medicaid office or your state's Medicare Savings Program directly — Medicare itself does not process these reductions.
  • If your income drops during the year, you can request a recalculation rather than waiting for the annual adjustment.
  • Your state's 211 service or your local Area Agency on Aging can tell you which program you may be able to use and how to contact the right office.

Medicare Savings Programs: Income Limits and What They Cover

Medicare Savings Programs exist in all 50 states and the District of Columbia. They are run by state Medicaid offices but are separate from Medicaid itself. There are three tiers: may have access to Medicare Beneficiary (QMB), Specified Low-Income Medicare Beneficiary (SLMB), and may have access to Individual (QI). Each tier has a different income limit and covers different costs.

The QMB program covers your Part B premium, deductible, coinsurance, and copays. To may have access to, your income must be at or below 100% of the federal poverty level. For 2024, that means a single person earning $1,385 per month or less, or a married couple earning $1,868 per month or less. These amounts increase slightly each year.

The SLMB program covers only your Part B premium. Income limits are higher — around 120% of poverty level, or roughly $1,662 per month for a single person in 2024. The QI program also covers Part B premiums but has even higher income limits, around 135% of poverty level. However, QI has limited funding and may not be available in your state or may have a waiting list.

To find out which program fits your situation and what the exact income limits are in your state, contact your state Medicaid office directly. You can also call 1-800-MEDICARE and ask for your state's Medicare Savings Program office, or search online for "[Your State] Medicare Savings Program".

Medicaid and Part B Premium Payment

Medicaid is a joint federal and state program that covers medical costs for people with low income and limited assets. In states that have expanded Medicaid, the income limits are often higher than Medicare Savings Programs. Medicaid can pay your Part B premium as part of your overall coverage, but you must first be approved for Medicaid in your state.

Medicaid income and asset limits vary widely. Some states use 138% of the federal poverty level as the cutoff; others use much lower thresholds. Some states count your assets (savings, investments, property) and some do not. Because the rules are so different from state to state, you cannot know whether you may have access to without contacting your state Medicaid office.

If you are already receiving Supplemental Security Income (SSI), you are automatically may be able to access for Medicaid in most states. If you are not on SSI, you will need to contact your state Medicaid office to find out whether you meet the income and asset requirements. You can find your state office at medicaid.gov or by calling 1-800-MEDICARE.

How Income Is Calculated and When It Is Checked

Both Medicare Savings Programs and Medicaid use your Modified Adjusted Gross Income (MAGI) from two years before the current year to set your premium. This means your 2024 premium is based on your 2022 tax return. The lag exists because Social Security and Medicare need time to process income data.

If your income drops significantly during the year — because you retired, lost a job, or had a major life change — you can request a recalculation rather than waiting until the next annual adjustment. You will need to provide proof of the income change, such as a termination letter from your employer or a new Social Security statement. Contact your state Medicaid office or Medicare Savings Program to ask about a mid-year review.

Income limits are adjusted each year for inflation. The thresholds for 2025 will be slightly higher than 2024, but you should not assume your status will change. Check with your state office annually to confirm whether you still may have access to.

How to Request Part B Premium Reduction or Waiver

You do not contact Medicare directly to request a premium reduction. Instead, you contact your state Medicaid office or your state's Medicare Savings Program office. The process and required documents vary by state, but most will ask for proof of income (recent tax return, pay stubs, or Social Security statement), proof of citizenship or legal residency, and proof of enrollment in Medicare Part B.

Some states allow you to explore online, by mail, or in person. Others require an in-person interview. Call your state office first to ask what documents you need and which process method is fastest in your area. Processing times range from two weeks to two months, depending on the state and the program.

Once you are approved, the program pays your premium directly to Medicare on your behalf. You will see the reduction reflected in your Medicare bill. If you are approved retroactively (meaning the approval covers months before you applied), you may receive a refund for premiums you already paid.

Common Reasons Applications Are Delayed or Denied

The most common reason for delay is missing or incomplete documentation. If you do not provide a recent tax return or proof of income, the office will ask you to resubmit. If you wait to provide it, your process sits in a queue. Bring all requested documents with you or mail them together the first time.

Applications are sometimes denied because the income calculation includes a source the applicant did not expect. For example, if you have a pension, rental income, or investment income, it counts toward your total income even if you do not think of it as "earnings". If your process is denied, ask the office to explain which income sources pushed you over the limit. You may be able to appeal or reapply if circumstances change.

Another common issue is explore with outdated income information. If you retired last year but submitted a tax return from when you were still working, your income will appear higher than it actually is. Always provide the most recent tax return or income statement available, and explain any major changes in writing.

Finding Your State Office and Getting Help

Your state Medicaid office is the fastest way to find out whether you may have access to for either Medicaid or Medicare Savings Programs. You can find the office online by searching "[Your State] Medicaid" or by visiting medicaid.gov and selecting your state.

If you do not have internet access or prefer to speak with someone, call 1-800-MEDICARE (1-800-633-4227). The representative can tell you the phone number and address of your state's Medicare Savings Program office and can answer basic questions about income limits. They can also connect you with your state's 211 service, which is a free referral line that knows about local programs and can sometimes help with applications.

Your local Area Agency on Aging also has staff who understand Medicare and Medicaid. They can explain the programs in your area, help you gather documents, and sometimes submit applications on your behalf. To find your local office, search "Area Agency on Aging [Your County]" or call 1-800-677-1116.

Frequently Asked Questions

If I get Part B premium help, do I have to pay back the money later?

No. Medicare Savings Programs and Medicaid are not loans. Once you are approved, the program pays your premium as long as you remain may be able to access. You do not repay the money, and there is no lien on your estate after you die. If you become ineligible (because your income rises), the program stops paying, but you do not owe back payments.

Can I get Part B for free if I have never worked?

You cannot get Part B itself for free — you must be enrolled in Part A to be may be able to access for Part B. However, if your income is low enough, Medicaid or Medicare Savings Programs will pay your Part B premium, deductible, and copays. The programs do not require a work history; they only look at current income and assets.

What happens to my Part B premium if my income goes up after I am approved?

Your premium reduction or waiver continues until the next annual adjustment, which happens in January. At that time, Medicare recalculates your premium based on your income from two years prior. If your income has risen, your premium may increase. You will receive a notice in December showing your new premium for the following year.

Do I have to reapply every year for Medicare Savings Programs?

Rules vary by state. Some states require annual renewal; others renew automatically if your income has not changed. When you are first approved, ask the office whether you need to reapply or whether they will contact you if renewal is required. Mark your calendar to check in before your approval expires, so there is no gap in coverage.

Can I use both Medicaid and Medicare Savings Programs at the same time?

No. If you may have access to for Medicaid, you are enrolled in Medicaid and do not need Medicare Savings Programs — Medicaid covers your Part B premium and other costs. If you do not may have access to for Medicaid but your income is low enough for Medicare Savings Programs, you use that instead. Your state office will determine which program you are may be able to access for and enroll you in the right one.