Medicare Part A and Part B costs depend on your work history and income

Most people pay nothing for Medicare Part A (hospital insurance) if they or their spouse paid Medicare taxes for at least 10 years while working. Medicare Part B (medical insurance) costs a monthly premium that changes each year — for 2024, the standard premium is $164.90 per month, though you may pay more if your income is above a certain threshold.

The amount you pay also depends on when you sign up. If you delay Part B after you first become may be able to access, you typically pay a permanent 10% penalty for each year you waited. Part A has a different penalty structure: if you don't have 30 quarters of Medicare tax credits, you pay a monthly premium that ranges from roughly $278 to $556 in 2024, depending on how many quarters you do have.

Beyond the monthly premium, both parts have deductibles and coinsurance — amounts you pay when you actually use services. These are separate from the premium and change yearly.

Key Takeaways

  • Part A is free for most people who worked and paid Medicare taxes for 10 years; Part B costs a monthly premium that starts at $164.90 in 2024 but rises if your income exceeds $103,000 (single) or $206,000 (married).
  • If you delay enrolling in Part B after you first become may be able to access, you pay a permanent 10% penalty on your monthly premium for each year you waited.
  • Part A has a $1,632 deductible per hospital stay in 2024, and Part B has a $240 annual deductible plus 20% coinsurance for most services.
  • If you don't have enough work credits for free Part A, you can buy it; the premium ranges from $278 to $556 per month depending on your work history.
  • Your actual out-of-pocket costs depend on which services you use and whether you have supplemental coverage (Medigap) or a Medicare Advantage plan.

Part A premiums: who pays and who doesn't

You pay nothing for Part A if you have at least 30 quarters (7.5 years) of Medicare-taxed work history, and most people who worked full-time for 10 years have this. Your spouse's work history counts too — if either of you meets the requirement, you both get free Part A at 65.

If you have between 20 and 29 quarters of work history, you pay a reduced premium. In 2024, that premium is $278 per month. If you have fewer than 20 quarters, you pay the full premium of $556 per month. These amounts change yearly.

You can buy Part A even if you don't may have access to for free coverage, and some people do this to have hospital insurance while delaying Part B. However, if you buy Part A, you must also buy Part B — you cannot have one without the other unless you have free Part A.

Part B premiums: standard and income-based

The standard Part B premium for 2024 is $164.90 per month. However, if your modified adjusted gross income (MAGI) from two years prior exceeds certain thresholds, you pay more through a system called Income-Related Monthly Adjustment Amount (IRMAA).

For 2024 coverage, Medicare looks at your 2022 tax return. If you filed as single and your MAGI was $103,000 or less, or married filing jointly and your MAGI was $206,000 or less, you pay the standard $164.90. Above those thresholds, your premium rises in brackets — the highest earners pay $560.50 per month for Part B in 2024.

If your income drops due to retirement, job loss, or death of a spouse, you can request that Medicare use your current year's income instead of the two-year-old figure. This is called a life-changing event appeal, and you must file it within 60 days of the event.

Part A and B deductibles and coinsurance you pay per use

Part A has a $1,632 deductible per benefit period in 2024. A benefit period starts when you enter a hospital and ends 60 days after you leave. If you go back to the hospital after that 60-day window, a new benefit period begins and you pay the deductible again. After you meet the deductible, Medicare covers all hospital costs for days 1 through 60, but you pay coinsurance ($408 per day in 2024) for days 61 through 90, and higher coinsurance for days beyond that.

Part B has a $240 annual deductible in 2024. Once you meet it, Medicare typically covers 80% of the approved cost for doctor visits, outpatient surgery, and diagnostic tests, and you pay the remaining 20%. This 20% coinsurance has no annual cap — the more services you use, the more you pay.

Neither deductible carries over to the next year. Part A's benefit period resets 60 days after discharge; Part B's deductible resets on January 1.

Late enrollment penalties that increase your costs permanently

If you don't sign up for Part B when you first become may be able to access at 65, you pay a 10% penalty on your monthly premium for each full year you delay. This penalty is permanent — it stays on your premium for as long as you have Part B, even if you move to a different plan.

For example, if you delay Part B for three years, you pay an extra 30% on top of your standard premium. In 2024, that would add roughly $49.47 to your monthly cost forever. The only way to remove this penalty is to have had creditable coverage (such as employer health insurance) during the months you were not enrolled in Part B.

Part A does not have a late enrollment penalty if you have free Part A. However, if you must buy Part A and you delay, you pay a 10% penalty on the premium for twice as long as you delayed — so a two-year delay costs you a 40% penalty.

How Medigap and Medicare Advantage affect what you actually pay

Your Part A and B premiums are only the beginning. Most people also buy either a Medigap policy (supplemental insurance) or enroll in a Medicare Advantage plan (an alternative to Original Medicare).

Medigap policies cover some or all of the deductibles and coinsurance you would otherwise pay under Part A and B. A Medigap premium ranges widely — typically $100 to $300+ per month depending on your age, location, and which plan letter (A through N) you choose. Medigap has no income limits, so your premium does not rise based on how much you earn.

Medicare Advantage plans replace Part A and B entirely. You pay a monthly premium (often $0 to $50, sometimes higher) plus copays when you use services. Advantage plans have annual out-of-pocket maximums, so your total costs are capped — but you must use in-network providers and may need referrals for specialists.

Frequently Asked Questions

Do I have to pay for Part A if I never worked?

If you have no work history under Social Security, you cannot get free Part A. You can buy it at age 65 for $556 per month in 2024, but you must also buy Part B. If you are married and your spouse has the required work history, you may may have access to for free Part A based on their record.

What happens if I miss the important date to sign up for Part B?

You can still sign up, but you pay a permanent 10% penalty on your monthly premium for each year you were late. The penalty applies for as long as you have Part B. You can avoid the penalty only if you had other health coverage (such as employer insurance) during the months you were not enrolled.

Can my Part B premium go down if my income drops?

Yes. If you retire, lose a job, or experience another major life change, you can file a life-changing event appeal within 60 days. Medicare will use your current year's income instead of the two-year-old tax return, which may lower your IRMAA and reduce your premium.

Does Medicare cover everything after I pay the deductible?

No. Part A covers hospital stays after the deductible, but Part B only covers 80% of approved costs — you pay 20% coinsurance. Some services, like dental, vision, and hearing aids, are not covered at all. Many people buy Medigap or choose Medicare Advantage to cover these gaps.

Are there any months when I don't have to pay Part B if I'm still working?

If you are still working and have employer health insurance, you can delay Part B without penalty. However, you must sign up within eight months of leaving that job or losing the coverage, or you will owe the late penalty.