Medicare Part B premiums and out-of-pocket costs

Medicare Part B covers doctor visits, outpatient care, and certain medical equipment. You pay a monthly premium for Part B, and the amount depends on your income. In 2024, the standard premium is $164.90 per month, but if you earn more than a certain threshold, you pay a higher amount called an Income-Related Monthly Adjustment Amount (IRMAA).

Beyond the premium, you also pay when you use services. You pay a yearly deductible (the amount you must pay out of pocket before Medicare starts to pay), and then you pay coinsurance — typically 20 percent of the cost of most services after you meet the deductible. These out-of-pocket costs add up differently depending on what services you use and how often.

The exact amounts change each year. Medicare announces new premiums and deductibles in the fall for the following year, so the figures that explore to you depend on when you enroll and what your income was two years before.

Key Takeaways

  • The standard Part B premium in 2024 is $164.90 per month, but you pay more if your income exceeds $97,000 (single) or $194,000 (married filing jointly).
  • You also pay a yearly deductible and 20 percent coinsurance on most services after the deductible is met.
  • Income thresholds for higher premiums are based on your tax return from two years before you enroll, so changes in your income may not affect your premium when ready.
  • If you delay enrolling in Part B, you may face a permanent penalty that increases your premium for life.
  • Medigap or Medicare Advantage plans can reduce your out-of-pocket costs, though they have their own premiums and rules.

How income affects your Part B premium

If your income is below the threshold, you pay the standard premium. If it is above the threshold, Medicare calculates a higher premium based on your Modified Adjusted Gross Income (MAGI) from your tax return from two years before. The higher you earn, the more you pay — there are five income brackets, and the premium can be as much as three times the standard amount.

For 2024, the income thresholds are $97,000 for single filers and $194,000 for married couples filing jointly. If you are above these thresholds, you move into a higher bracket. The brackets continue upward, with the highest earners paying significantly more. These thresholds also change each year.

If your income drops — because you retire, lose a job, or have a major life change — you can ask Medicare to recalculate your premium using your current year's income instead of the two-year-old figure. This is called a Life Changing Event request, and you must report it within 60 days of the event.

The deductible and coinsurance you pay

In 2024, the Part B deductible is $240 per year. Once you pay this amount out of pocket for covered services, Medicare begins to pay its share. After you meet the deductible, you typically pay 20 percent of the cost of doctor visits, lab work, imaging, and other outpatient services. Medicare pays the remaining 80 percent.

Some services have different rules. For example, preventive care (like annual wellness visits and certain screenings) is covered at no cost to you after you meet the deductible. Mental health services and physical therapy may have their own limits or payment structures. Home health services and hospice have different cost-sharing rules as well.

These out-of-pocket costs are separate from your premium. If you use many services in a year, your total Part B costs — premium plus deductible plus coinsurance — can be substantial. This is why many people also purchase a Medigap policy or enroll in a Medicare Advantage plan to cap their costs.

When you must enroll and what late enrollment costs

You become may be able to access for Medicare at age 65. If you do not enroll in Part B when you first become may be able to access, you may face a late enrollment penalty. This penalty is a permanent 10 percent increase to your premium for each full 12-month period you delayed enrollment. If you wait three years to enroll, your premium will be 30 percent higher for the rest of your life.

There are exceptions. If you are still working and covered by your employer's health plan, you can delay Part B without penalty. You must enroll within eight months of losing that coverage. If you miss this window, the penalty applies. The same rule applies if you are covered by a spouse's employer plan.

If you are already receiving Social Security benefits, Medicare Part B is automatically enrolled at age 65 unless you actively decline it. If you are not receiving Social Security, you must enroll yourself during your Initial Enrollment Period, which runs three months before, the month of, and three months after your 65th birthday.

Medigap and Medicare Advantage as alternatives

Original Medicare (Part A and Part B) leaves you responsible for deductibles and coinsurance. Many people reduce these costs by purchasing a Medigap policy or enrolling in a Medicare Advantage plan. Both have their own premiums and rules, so the total cost depends on which option you choose.

Medigap policies are sold by private insurers and cover some or all of the costs you would otherwise pay out of pocket under Original Medicare. There are ten standardized Medigap plans (labeled A through N), and each covers a different set of costs. Medigap premiums vary by insurer, age, and location, and they are in addition to your Part B premium.

Medicare Advantage plans (Part C) are an alternative to Original Medicare. They are offered by private insurers and typically have lower or no premiums than Medigap, but they usually require you to use doctors and hospitals within their network. They may also have copays and coinsurance, though often lower than Original Medicare. Medicare Advantage plans must cover everything Original Medicare covers, but they can structure costs differently.

How to find your current Part B costs

Your Part B premium appears on your Social Security payment stub if you receive benefits, or on a separate bill from Medicare if you do not. You can also check your premium and deductible by logging into your Medicare account at Medicare.gov or by calling 1-800-MEDICARE.

If you believe your income-based premium is wrong, or if your income has changed significantly, contact Social Security (if you receive benefits) or Medicare directly. You can request a recalculation if you have had a major life change such as retirement, loss of income, or marriage.

Your costs may also change if you enroll in a Medigap or Medicare Advantage plan. Compare plans during the annual enrollment period (October 15 to December 7) to see whether a different plan would lower your total costs. Plans, premiums, and coverage change each year, so reviewing your options annually is important.

Frequently Asked Questions

Does Medicare Part B cover everything a doctor charges?

No. Medicare Part B covers the services themselves, but you pay the deductible and coinsurance. Some doctors also charge more than Medicare allows, and you may owe the difference — unless they accept Medicare's approved amount as payment in full. Always ask whether a doctor accepts Medicare assignment before scheduling.

What happens if I can't afford my Part B premium?

If your income is very low, you may be able to get help paying your premiums through Medicaid or a Medicare Savings Program run by your state. Contact your state Medicaid office or call 1-800-MEDICARE to learn whether you may have access to. These programs are based on income and vary by state.

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

Yes, but only if you report a major life change within 60 days. may have access to events include retirement, loss of income, marriage, divorce, or death of a spouse. Contact Social Security or Medicare to request a recalculation. Otherwise, your premium is based on your tax return from two years prior and does not change until the next annual adjustment.

Is the Part B deductible the same every year?

No. The deductible changes annually. Medicare announces the new deductible in the fall for the following year. In recent years, the deductible has increased slightly most years, though the amount varies. Check your Medicare notices in the fall to see what your deductible will be for the coming year.

Do I pay Part B costs if I have a Medicare Advantage plan?

Yes, you still pay the Part B premium. However, Medicare Advantage plans often have lower out-of-pocket costs than Original Medicare because they cap your annual spending and may have lower copays. The trade-off is that you must use doctors and hospitals in the plan's network, with few exceptions.