While Original Medicare (Parts A and B) covers an extensive range of care, it does not cover everything. Additionally, premiums, deductibles, copays, and coinsurance still apply, making it essential for Medicare beneficiaries to understand which costs to expect.
Since Original Medicare doesn’t cover 100% of all healthcare services, many beneficiaries will choose to enroll in coverage offered through private insurers. These Medicare plan options include Medicare Advantage, Medigap, and Part D, all of which come with their own set of premiums, deductibles, and other costs.
Standard Monthly Cost: Free Annual Deductible in 2022: $1,556
The vast majority of Americans receive Medicare Part A for free. People who must “buy in” to Medicare will pay a fluctuating amount (between $274 and $499 per month) based on how much they have paid in Medicare taxes.
Most enrollees have zero costs for Medicare Part A because they have worked for more than ten years (or forty quarters). You will have to pay a premium for Part A if you do not meet these requirements. Many Medicare Advantage and Medigap plans are designed to cover these costs.
Medicare Part B Costs
Standard Monthly Cost: $170.10 Annual Deductible in 2022: $233
All Medicare patients pay a monthly premium for Part B based on income. For most people (those who make $91,000 or less), their monthly premium is $170.10 for 2022. Higher earners will pay more.
Part B enrollees also must pay a deductible out-of-pocket before receiving benefits. In 2022, the Part B deductible is $233.
Medicare Part B Monthly Premiums
$91,000 or less
Medicare Advantage Costs
Average Monthly Cost: $63 Annual Deductible in 2022: Varies by plan
Because Medicare Advantage (Part C) plans are sold by private companies, costs vary broadly by the provider and where you live. Some programs cost as low as $0 per month, while payments for coinsurance, copays, and deductibles can drive costs up higher. Suppose you are considering enrolling in Medicare Advantage. In that case, you should use Medicare’s free online tool to find your best policy.
Average Monthly Cost: $32 Annual Deductible in 2022: $344
Costs for Medicare Part D will vary based on the individual plan you choose and your household income. For 2022, the average monthly price for Medicare Part D is $32. Deductibles also vary; the average drug plan deductible is around $368. There is also an income threshold of $91,000. Patients with higher incomes will be required to pay an additional fee.
Additional Monthly Costs for Part D
Additional Monthly Fees
$91,000 or less
$500,001 or more
Medicare Supplement Plan Costs
The average monthly cost for Medicare Supplement Plans (Medigap) is $163 in 2022. That said, there are ten different Medigap Plans, and premiums vary depending on the policy you choose and age, gender, and pricing structures where you live.
More comprehensive Medigap Plans such as Plan G tend to cost more than plans with less coverage. Costs can also be determined by rating systems:
Community-rated: Everyone enrolled in these particular plans pays the same premium.
Issue-age-rated: Medigap plans’ premiums are based on your age when you bought your policy. The younger you were when you bought it, the lower your cost in most cases.
Attained-age-rated: These premiums are based on your current age and increase as you age.
No matter the specifics of your plan, Medicare will always come with costs in deductibles and premiums. Thankfully, a wide range of programs allows you to choose and change your coverage as you go through life. Considering the variety available, it is essential to budget and research properly before selecting the proper care.
Amie has been writing about senior care products and services for the last decade. She is particularly passionate about new technologies that help improve the quality of life for seniors and their families. Seeing her parents and grandparents age made Amie ask herself, “Would this be good enough for my loved ones?” In her spare time, Amie enjoys outdoor adventures and spontaneous road trips. Learn more about Amie here