Medicare Part B is the monthly insurance premium you pay to cover doctor visits, outpatient care, and diagnostic tests

Medicare Part B is not automatic. You choose to enroll, and when you do, you pay a monthly premium directly to Medicare. That premium covers your share of the cost for visits to doctors, hospital outpatient services, medical equipment, and lab work. The amount you pay depends on your income — higher earners pay more — and whether you enrolled when you first became may be able to access.

The standard Part B premium changes each year. In 2024, the base premium is $164.90 per month for most people, but your actual premium may be higher if your income was above a certain threshold two years ago. If you delay enrolling in Part B after you first become may be able to access, you will pay a permanent penalty on top of your premium for as long as you have Medicare.

Part B is separate from Part A (hospital coverage), which most people do not pay a premium for. You can have Part A without Part B, but most people enroll in both when they turn 65 or become may be able to access due to disability.

Key Takeaways

  • The standard Part B premium in 2024 is $164.90 per month, but your actual amount depends on your income from two years prior.
  • If your modified adjusted gross income exceeds certain thresholds, you will pay an additional surcharge called Income-Related Monthly Adjustment Amount (IRMAA).
  • Delaying Part B enrollment after your initial may be able to access period results in a permanent 10 percent penalty added to your premium for each year you waited.
  • Part B premiums are usually deducted automatically from your Social Security check, but you can arrange to pay Medicare directly instead.
  • You can change your Part B coverage status only during the General Enrollment Period (January 1 to March 31) or if you have a may have access to life event.

How the Standard Premium Works and When It Changes

Medicare sets a standard Part B premium each year based on the cost of providing Part B services. The Centers for Medicare & Medicaid Services (CMS) announces the new premium amount in the fall, and it takes effect January 1. The premium has increased most years, though the amount of increase varies.

You pay the same standard premium as most other Part B enrollees unless your income pushes you into a higher bracket. The premium covers roughly 25 percent of the average cost of Part B services; the federal government funds the rest through general tax revenue. This means your premium does not cover the full cost of your coverage — you are also responsible for deductibles and coinsurance when you use services.

Income-Related Surcharges (IRMAA) and Who Pays More

If your income is above a certain level, Medicare adds an extra charge to your Part B premium called an Income-Related Monthly Adjustment Amount (IRMAA). Medicare uses your modified adjusted gross income from your tax return from two years before the current year to calculate this. For example, in 2024, Medicare looks at your 2022 tax return.

The income thresholds and surcharge amounts change each year. In 2024, single filers with income above $97,000 and married couples filing jointly with income above $194,000 begin paying additional amounts. The surcharge increases in steps as income rises, and the highest earners can pay several hundred dollars more per month than the standard premium.

If your income drops significantly — due to retirement, job loss, or a major life event — you can request that Medicare recalculate your IRMAA using your current year's income instead. You must file a form called the Medicare Income-Related Monthly Adjustment Amount Life-Changing Event and provide documentation of the change.

Late Enrollment Penalties and How They Work

If you do not enroll in Part B during your Initial Enrollment Period — the seven-month window that starts three months before the month you turn 65 — you will owe a penalty. The penalty is 10 percent of the standard Part B premium for each full year you delayed enrollment.

This penalty is permanent. If you waited two years to enroll, your premium will be 20 percent higher than the standard amount, and that extra amount stays with you for life. The only exceptions are if you had creditable coverage through an employer or union, or if you are a federal employee or railroad retiree with specific coverage.

The penalty applies even if you enroll later and even if you switch to a different plan. It is one of the few Medicare penalties that never goes away, so understanding your enrollment window matters.

How You Pay Your Part B Premium

Most people have their Part B premium deducted automatically from their Social Security check each month. If you are not yet receiving Social Security, or if you want to pay a different way, you can arrange to pay Medicare directly by check, electronic funds withdrawal, or credit or debit card.

If you are enrolled in a Medicare Advantage plan (Part C) or a Medigap supplemental plan, you still pay the Part B premium to Medicare separately. The Medigap plan may help cover your Part B deductible and coinsurance, but it does not replace the Part B premium itself.

If you cannot afford your Part B premium, you may be able to get help through your state's Medicare Savings Program, which can pay your premium and some of your other out-of-pocket costs. Each state runs its own program with different income limits.

When Your Part B Premium Can Change

Your Part B premium can change for several reasons. The standard premium amount changes every January 1. Your IRMAA surcharge can change if your income changes, though Medicare uses a two-year lag, so changes to your current income will not affect your premium until two years later.

If you experience a major life event — such as the death of a spouse, divorce, loss of income, or loss of employer coverage — you can request that Medicare recalculate your IRMAA using your current year's income. You have 60 days from the event to file the request.

You can also change your Part B coverage during the General Enrollment Period, which runs January 1 to March 31 each year. Changes made during this period take effect July 1. Outside this window, you can only change your coverage if you have a may have access to life event.

Part B Premium Versus Other Out-of-Pocket Costs

Your Part B premium is only one piece of what you pay for Medicare coverage. You also pay an annual deductible before Medicare starts to pay its share — in 2024, the Part B deductible is $240. After you meet the deductible, you typically pay 20 percent of the cost of covered services, and Medicare pays 80 percent.

If you enroll in a Medigap plan, that plan can cover your deductible and coinsurance, but you pay a separate premium for the Medigap plan on top of your Part B premium. If you choose a Medicare Advantage plan instead of Original Medicare, you may have lower premiums but different deductibles and copayments, and you must use doctors in the plan's network.

Understanding the difference between your premium (what you pay monthly to have coverage) and your out-of-pocket costs (what you pay when you use services) helps you budget for the full cost of your healthcare.

Frequently Asked Questions

Can I turn down Part B and enroll later without a penalty?

Only if you have creditable coverage through an employer or union while you are still working. If you turn down Part B without this coverage, you will owe a 10 percent penalty for each year you delayed, and the penalty is permanent. Check with your employer's benefits office before declining Part B.

What if my income drops after I retire?

You can request that Medicare recalculate your IRMAA using your current year's income instead of the two-year-old income on your tax return. File a Life-Changing Event form within 60 days of the income change and include documentation such as a tax return, Social Security statement, or letter from your employer.

Do I have to pay Part B if I am still working?

If you are covered by an employer health plan while working, you can delay Part B enrollment without penalty as long as the employer coverage continues. Once you leave that job or lose the coverage, you have eight months to enroll in Part B without penalty. After that window closes, the late penalty applies.

Will my Part B premium go down if I move to a different state?

No. Part B premiums are the same nationwide. Your state does not affect your premium amount, though some states offer Medicare Savings Programs that may help pay your premium if your income is low enough.

What happens to my Part B premium if I go back to work?

Your premium itself does not change based on current work income. However, if your earnings increase your modified adjusted gross income, your IRMAA surcharge may increase two years later when Medicare processes your new tax return. The surcharge takes effect in January of the year after Medicare receives your tax information.