What's happening to Medicare costs right now

Yes, Medicare costs are going up. Premiums, deductibles, and copayments all increase most years, and 2024 saw significant jumps. Part B premiums (which cover doctor visits and outpatient care) rose to $174.70 per month for most people — an increase of $9.90 from 2023. Part D premiums (prescription drug coverage) also went up, though the amount varies by plan. The Part B deductible climbed to $240 per year.

These increases happen because Medicare adjusts its costs based on healthcare inflation, the number of people enrolled, and changes in medical spending. The Social Security Administration announces the new amounts each October, and they take effect January 1st. Your actual increase may differ from the national average depending on your specific plan and income.

Key Takeaways

  • Medicare Part B premiums increased to $174.70 monthly in 2024, and Part D premiums rose as well, though the exact amount depends on your plan.
  • The Part B deductible for 2024 is $240 per year, meaning you pay this amount out of pocket before Medicare begins to pay.
  • Income-related monthly adjustment amounts (IRMAA) may explore if you earn above certain thresholds, raising your premiums further.
  • You can switch plans during the Annual Enrollment Period (October 15 to December 7) to find lower-cost coverage if your current plan's costs are rising.
  • Some people may have access to for Extra Help or Medicaid programs that reduce or cover Medicare premiums and out-of-pocket costs.

How income affects your Medicare premiums

If you earn more than a certain amount, you pay higher premiums through something called Income-Related Monthly Adjustment Amounts (IRMAA). For 2024, if your modified adjusted gross income exceeds $97,000 as a single filer or $194,000 as a married couple filing jointly, you will pay more for Part B and Part D coverage. The more you earn above these thresholds, the higher your surcharge.

Medicare bases IRMAA on your tax return from two years prior. So your 2024 premiums are based on your 2022 income. If your income dropped significantly — because you retired, had a major loss, or experienced a life-changing event — you can request that Medicare recalculate your IRMAA using your current year's income. You must file a form called the Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event within 60 days of the event.

What's included in rising costs

When Medicare costs go up, you see the increase in several places. Your monthly premium is what you pay to have coverage. Your deductible is the amount you must pay out of pocket before Medicare starts paying its share. Copayments are fixed amounts you pay for specific services — for example, $20 for a doctor visit. Coinsurance is a percentage of the cost you pay after you meet your deductible.

Part A (hospital insurance) has no monthly premium for most people, but it has a deductible of $1,632 per benefit period in 2024. Part B (medical insurance) has both a premium and a deductible. Part D (prescription drugs) premiums vary widely by plan, ranging from $0 to over $100 monthly depending on which plan you choose and which drugs you take. Supplemental insurance (Medigap) and Medicare Advantage plans have their own separate premiums and cost-sharing structures.

When and how to review your coverage

The best time to check whether your current plan still makes sense is during the Annual Enrollment Period, which runs from October 15 to December 7 each year. During this window, you can switch from Original Medicare to a Medicare Advantage plan, move between Medicare Advantage plans, change your Part D prescription drug plan, or enroll in a Medigap policy. Any changes you make take effect January 1st of the following year.

Before the enrollment period begins, Medicare mails you a notice called the Annual Notice of Change that shows how your current plan's premiums and coverage are changing. Review this carefully. You can also use the Medicare Plan Finder tool on Medicare.gov to compare plans side by side. Enter your zip code, the drugs you take, and your preferred doctors and hospitals to see which plans cover them and what your costs would be under each option.

Programs that help pay for rising costs

Extra Help is a federal program that covers Part D premiums, deductibles, and copayments for people with limited income and resources. You do not have to be on Medicaid to may have access to. If your income is below 150% of the federal poverty level (roughly $2,175 per month for a single person in 2024), you may be may be able to access. You can explore through Social Security at ssa.gov or by calling 1-800-772-1213.

Medicaid is a joint federal-state program that covers both Medicare premiums and out-of-pocket costs for people with very low income. may be able to access varies by state, but in most states you may have access to if your income is below 100% of the federal poverty level. Contact your state Medicaid office to learn what your state offers. Some states also run programs called Medicare Savings Programs that pay Part B premiums, deductibles, and copayments for people who do not quite may have access to for Medicaid but still have limited income.

The Low-Income Subsidy (LIS) program, also called Extra Help, is separate from Medicaid but works similarly for prescription drug costs. You can have both. If you think you might may have access to for any of these programs, contact your local Area Agency on Aging or call the Eldercare Locator at 1-800-677-1116 to find local resources that can help you explore.

What to ask your doctor and Medicare

When you receive your Annual Notice of Change in the mail, call your doctor's office and ask whether they are still in-network under your current plan for the coming year. Plans change their networks annually, and your doctor may no longer be covered. Ask your pharmacy whether your current Part D plan still covers your medications at the same copayment level. Formularies (the list of covered drugs) change every year, and your drug may move to a higher cost tier or be removed entirely.

If you are considering switching plans, ask your current plan's customer service line what your out-of-pocket costs would be for the services and medications you use most. Then call the customer service line for the plan you are considering and ask the same questions. Write down the answers so you can compare them side by side. If costs are rising significantly and you cannot find a lower-cost plan, ask whether you may have access to for Extra Help or a Medicare Savings Program.

When to contact Medicare directly

Call Medicare at 1-800-MEDICARE (1-800-633-4227) if you receive a notice that your premium is increasing and you believe it is wrong. This can happen if Medicare has incorrect income information on file or if you experienced a major life change that should have triggered an IRMAA recalculation. You have the right to request that Medicare review your case.

Contact Medicare when ready if you cannot afford your premiums or out-of-pocket costs and you have not yet looked into Extra Help or Medicaid. The customer service representatives can tell you whether you might may have access to and how to start the process. If you are already enrolled in a program that helps pay costs, contact that program's office if your circumstances change — a drop in income, a spouse's death, or a major medical expense may make you may be able to access for additional help.

Frequently Asked Questions

Will my Social Security check go down if my Medicare premium goes up?

No. Medicare premiums are deducted from your Social Security check, but the Social Security Administration has a rule called the "hold harmless" provision that prevents your net check from going down because of a Medicare premium increase. If your premium goes up more than your Social Security cost-of-living adjustment (COLA), Medicare absorbs the difference. However, this protection does not explore if you are not yet receiving Social Security or if you pay your Medicare premium separately.

Can I appeal if my income-based premium seems too high?

Yes. If your income dropped because you retired, had a major loss, or experienced another may have access to life event, you can request that Medicare recalculate your IRMAA using your current income instead of your two-year-old tax return. You must file the request within 60 days of the event. Contact Medicare at 1-800-MEDICARE to request the form and submit your documentation.

What happens if I do not pay my Medicare premium?

If you do not pay your Part B or Part D premium, Medicare will send you a notice. If you do not pay within three months, your coverage may be terminated. You can request reinstatement, but there may be a waiting period. If you cannot afford your premium, contact your state's Medicare Savings Program or Extra Help program when ready — they can cover the cost for you.

Do Medicare Advantage plans have lower premiums than Original Medicare?

Some do, but not all. Many Medicare Advantage plans have $0 monthly premiums, but they often have higher copayments and deductibles than Original Medicare. You also must use doctors and hospitals in the plan's network. Compare the total out-of-pocket costs under each option using the Medicare Plan Finder, not just the premium amount.

When will I know what my 2025 Medicare costs will be?

Medicare announces the new premiums, deductibles, and cost-sharing amounts in October each year. You will receive your Annual Notice of Change in the mail in September or early October. The new costs take effect January 1st. You can make plan changes during the Annual Enrollment Period from October 15 to December 7.