Do Medicare Advantage plans pay part of my Part B premium?
Some do. It is called a giveback and the money is real, but it is worth understanding what funds it before you choose a plan for that reason.
Some Medicare Advantage plans include a Part B premium reduction, usually called a giveback or a Part B buydown. The plan credits part of your Part B premium back to you.
How you actually receive it
If your Part B premium is deducted from your Social Security check, the reduction shows up as a smaller deduction, meaning a larger deposit each month. You do not get a separate check.
If you are billed directly by Medicare rather than drawing Social Security, your bill is reduced instead.
It typically takes a couple of months after enrollment for the adjustment to appear, and it is retroactive to your effective date. Do not panic if the first month or two look unchanged.
It is real money
There is nothing gimmicky about it. The plan is using part of the payment Medicare makes on your behalf to reduce your premium instead of adding another benefit. That is a legitimate design and it is genuinely valuable, particularly for someone on a fixed income.
What funds it
A plan has a fixed budget per enrollee. Money spent on a giveback is money not spent elsewhere.
- A narrower network, often HMO rather than PPO
- A higher annual out of pocket maximum
- Thinner dental, vision or hearing allowances
- Higher copays on services you may actually use
- More prior authorization
None of that makes a giveback plan a bad plan. It makes it a plan that made a specific trade. Compare the annual giveback total against the difference in out of pocket maximums, and see which number is larger. Sometimes the giveback wins easily. Sometimes it is a small monthly gain against a much larger worst case.
How to evaluate one properly
- Multiply the monthly giveback by twelve. That is what you gain in a year.
- Compare the plan's out of pocket maximum against the alternatives. That is what you risk.
- Price your medications on its formulary, since a giveback plan may economize there.
- Check that your doctors and hospital are in network.
- Then decide whether the annual gain is worth the trade.
See how to compare Advantage plan costs.
If you want your Part B premium paid entirely
There is a better route for people with limited income, and it is separate from any plan.
Medicare Savings Programs can pay your full Part B premium, not just part of it. QMB, SLMB and QI have income and asset limits that are higher than most people assume, and qualifying also opens the door to Extra Help on prescriptions.
In Texas you apply through Health and Human Services rather than Social Security. See how these programs work.
Because giveback amounts vary by plan and reset each year, and because CMS regulates how agencies present plan specific benefits publicly, we would rather look at what is actually available at your address than quote figures here.
Common follow-up questions
Is the giveback taxable?
It reduces a premium rather than paying you income, so it is not treated as taxable income. Ask whoever prepares your taxes about your specific situation.
Can the giveback amount change?
Yes. Like every other plan feature it is set annually and can change in January. Check your Annual Notice of Change.
Is a giveback plan worth choosing for the money?
Only after you compare the out of pocket maximum, the network and the formulary. The annual giveback is often smaller than the difference in worst case exposure.
Want this looked at properly?
We are an independent agency in McAllen serving Hidalgo, Cameron and Starr counties. No cost to talk it through.
Call (956) 687-3334Read next
What is Medicare Advantage (Part C)?
Medicare Advantage