Does Medicare have a monthly premium?
Yes, most of it does. Part A usually has no monthly premium, but Part B, Part D and supplements each have one, and there are other costs on top.
- Part A, the hospital part, has no monthly premium for most people, because you paid for it through payroll taxes over about 10 years of work.
- Part B has a monthly premium nearly everyone pays, plus a yearly deductible, plus 20 percent of most bills with no upper limit.
- If your income is limited, a Medicare Savings Program can pay your Part B premium for you, and that money goes back into your Social Security check.
Yes, most of Medicare has a monthly premium (the monthly bill for the coverage). Part A, the hospital part, usually has no premium. Part B, Part D and any supplement each have one.
Why Part A has no premium for most people
You already paid for it. Every paycheck of your working life had a Medicare tax taken out. Once you or your spouse reach about 10 years of that, Part A comes with no monthly bill.
If you did not reach that work history, you can still buy Part A, and it carries a real monthly premium. This comes up most often for people who spent their careers outside the United States, which is not rare in South Texas.
What you still pay with premium free Part A
- A Part A deductible, the amount you pay yourself before Medicare pays, each time you start a new benefit period in the hospital. It is not once a year.
- Daily coinsurance, a set share of the cost for each day, if a hospital stay runs long.
- Daily coinsurance for skilled nursing care (nursing and therapy while you recover), after the first stretch of days.
Premium free means no monthly bill. You can still get a bill when you use the hospital.
Part B, Part D and supplements all have a premium
- Part B, the part that pays for doctor visits and outpatient care, has a monthly premium nearly everyone pays. It also has its own yearly deductible, and you pay 20 percent of most services with no ceiling. On $10,000 of doctor and outpatient bills, your share is $2,000.
- Part D, the drug coverage, has a monthly premium, a deductible, and copays (a set amount per prescription) that vary by the drug's tier, its price level in the plan.
- A Medigap policy, a supplement that pays your share of what Medicare covers, has a monthly premium.
- A Medicare Advantage plan may have no extra premium, but it has copays and an out of pocket maximum, the most you can be asked to pay in a year.
Where zero dollar plans come in
Two things cost you nothing.
- Preventive services under Part B, such as screenings, vaccines and the yearly wellness visit, when you use a doctor who accepts assignment, meaning the doctor takes Medicare's approved amount as full payment.
- Many Medicare Advantage plans in Hidalgo County charge no premium beyond the Part B premium you already pay.
A zero dollar premium Advantage plan still has costs. You keep paying your Part B premium every month, and you pay copays when you use care. What it removes is the extra monthly bill. See what zero premium really means.
Programs that can bring your cost near zero
If your income is limited, there are programs that can bring your cost down to almost nothing. Medicare lists the Medicare Savings Programs and their limits on medicare.gov.
- Medicare Savings Programs can pay your Part B premium outright, which puts that money back into your Social Security check.
- Extra Help, also called the Low Income Subsidy, cuts prescription costs sharply.
- Being dual eligible, meaning you have both Medicare and Medicaid, can leave you paying very little for anything.
It costs nothing to check whether you qualify, and the income limits are higher than most people assume. Read how Medicare and Medicaid work together in Texas.
Your next step is to add up your own monthly numbers: the Part B premium, a drug plan, and either a supplement or an Advantage plan. Call our McAllen office at (956) 687 3334, or enter your ZIP code in the plan pricing box on this page.
Common follow-up questions
I paid into Medicare my whole life. Why is there a Part B premium?
Your payroll taxes paid for Part A, the hospital part. Part B has always been a separate program you choose to join. It is paid for partly by premiums and partly by general tax money.
Can I refuse Part B to avoid the premium?
You can. But unless you have coverage from a job you are still working at, you will face a permanent penalty, an extra charge added to your premium, and a delay when you want Part B back. See the late enrollment penalty.
Is a zero premium Advantage plan really zero?
The plan itself charges no extra monthly premium. You still pay your Part B premium, and you pay copays each time you use care.
Want this looked at properly?
We are an independent agency in McAllen serving Hidalgo, Cameron and Starr counties. There is no obligation to talk it through.
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Gerino Alejos
Licensed insurance agent · License 3128710 · NPN 18243381
Owner of McAllen Insurance Group, an independent agency on North 10th Street in McAllen. Works with clients across Hidalgo, Cameron and Starr counties on Medicare, Marketplace health, life and auto coverage. Se habla español.