Medicare Premiums and Deductibles for 2021: Here's What You Need to Know

Medicare premiums and deductibles change annually. You can track your Medicare premiums and deductibles online by logging in to your Medicare account. In addition, you can use the Medicare Plan Finder to compare and contrast the costs of different Medicare plans.

2021 Medicare Part A Premiums and Deductibles

Most people qualify for Medicare premium-free Part A. With this program, you don't pay a monthly premium, as long as you or your spouse paid Medicare taxes for a designated period of time while working.

If you are age 65 or older, you will qualify for Medicare premium-free Part A if:

  • You previously received retirement benefits from Social Security or the Railroad Retirement Board.
  • You are eligible for Social Security or Railroad benefits but have not yet filed for them.
  • You or your spouse has Medicare-covered government employment.

If you are under the age of 65 and enrolled in Medicare, you may still be eligible for Medicare premium-free Part A if you meet certain income or medical standards.

For those who are ineligible for Medicare premium-free Part A, you can purchase a standard Part A plan, which has a monthly premium of $259 or $471. The premium amount varies based on how long you or your spouse worked or paid Medicare taxes.

Along with Medicare Part A premiums, it is important to account for plan deductibles. With Part A, you are required to pay a deductible of $1,484 for each benefit period.

2021 Medicare Part B Premiums and Deductibles

The standard premium amount for Medicare Part B is $148.50 per month. Most Part B enrollees pay this amount. However, if the modified adjusted gross income on your IRS tax return from 2019 is above a certain amount, you are required to pay the standard premium amount and an Income Related Monthly Adjustment Amount (IRMAA).

IRMAA is applied to your Part B premium amount if an individual earned $88,000 or more or a jointly filing household earned $176,000 or more in 2019. IRMAA will increase monthly premiums to $207.90-$504.90 depending on your 2019 income tax return.

The Part B annual deductible is $203. Once you reach your deductible, you'll typically be required to pay 20% for most doctor-approved services, outpatient therapy, and durable medical equipment (DME).

2021 Medicare Part C Premiums and Deductibles

Medicare Part C (Medicare Advantage) premium and deductible amounts vary by plan. Some Part C plans have no premium or even cover a portion of your Part B premium. Meanwhile, certain plans have a yearly deductible or additional deductibles.

Part C plan providers follow Medicare rules but set premium and deductible amounts on their own, and have their own network of doctors that they work with, much like private insurance. What you pay under a Part C plan may change only once a year, on January 1.

2021 Medicare Part D Premiums and Deductibles

With Medicare Part D, you will pay a monthly premium. This amount varies based on your plan and may be subject to IRMAA based on the income included on your 2019 tax return. Depending on your tax bracket, up to $77.10 can be added to your monthly Medicare Part D premium.

Part D deductibles depend on the plan. Some Part D plans have no deductible, and the maximum Part D annual deductible amount is $445.

2021 Medicare Supplement Insurance Premiums and Deductibles

A Medicare Supplement Insurance (Medigap) plan requires you to pay a monthly premium to a private insurance company. The premium amount varies based on the insurer as well as the rate type. You may need to pay the monthly premium in addition to a monthly Part B premium.

Medigap Plans F, G, and J are available with a high-deductible option. The annual deductible amount for these plans is $2,370; however, you can expect to pay significantly lower monthly premiums. If the difference in premiums across all twelve months exceeds the difference in deductible, it's an easy choice to go with the high deductible plan. A high deductible plan can also be a way to secure enrollment in Medigap early on in your Medicare qualification years, while avoiding paying high premiums while still in good health.

Source: iQuanti, Inc.


Categories: Healthcare Insurance

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