En español | Medicare Part B helps pay for doctor visits, lab tests, diagnostic screenings, medical equipment, ambulance transportation and other outpatient services, but the coverage still has some out-of-pocket costs:
- A deductible, which you must pay before Medicare will cover your doctor’s charges and some other outpatient services.
- Coinsurance, the percentage of the costs you pay for doctor’s visits and outpatient services.
- A premium, the monthly charge you pay for Medicare Part B.
- A late fee for Part B if you didn’t sign up at the proper time.
How much are the premiums for Part B in 2023?
Most people pay $164.90 a month for Medicare Part B in 2023. This premium is paid to the federal government whether you’re participating in original Medicare or a Medicare Advantage plan from a private insurer.
If you’re receiving Social Security benefits, the monthly premium will be deducted from your monthly benefit payments. If not, Medicare will bill you quarterly or you can set up an electronic payment.
How does late enrollment affect Part B premiums?
If you don’t sign up for Medicare when you’re first eligible and don’t qualify for a special enrollment period, you may have to pay a late enrollment penalty.
The Part B late enrollment penalty adds 10 percent to the standard Part B premium for each full 12-month period when you should have had Part B but didn’t. This penalty lasts for your lifetime.
So if you delayed enrolling for 40 months after you were eligible, you would pay a penalty based on your lack of coverage for 36 months, three full years. For 2023, that’s almost $50 additional — $164.90 x 0.1 x 3 = $49.47 — you’ll pay each month, amounting to nearly $600 a year. In this case, your monthly premium would be $214.40 because the amount is rounded to the nearest 10 cents.
The penalty is recalculated when the next year’s premium is announced.
Usually, you need to sign up for Medicare during your seven-month initial enrollment period, which starts three months before the month you turn 65 and ends three months after your birthday month. However, you may be able to delay if you or your spouse still works and you have health insurance through either of your employers. In that case, you need to sign up for Medicare Part B before your employer coverage ends or within eight months of losing your job-based coverage to avoid the late-enrollment penalty.
How does my income affect my Part B premium?
People who earn more money pay higher premiums for Medicare Part B. If you’re single and your adjusted gross income is higher than $97,000, or if you’re married filing jointly with income greater than $194,000, you’ll have to pay a high-income surcharge. The same is true for Medicare Part D prescription drug coverage.
This surcharge is officially called the income-related monthly adjustment amount (IRMAA). In 2023, high earners pay $230.80 to $560.50 a month per person for Part B, depending on their income.
The surcharge is usually based on your most recent income tax return on file, which is the 2021 return for most people in 2023. But if your income has dropped since then because of certain life-changing events — such as marriage, divorce, death of a spouse or retirement — you can contest the high-income surcharge and ask the Social Security Administration, which manages these surcharges, to recalculate your premiums based on your most recent income.
What are the out-of-pocket costs of Part B?
The Part B deductible is $226 in 2023. You need to pay that amount before most Part B coverage begins. After that, you pay 20 percent of the Medicare-approved amount, called coinsurance, for most doctor and outpatient services and durable medical equipment.
Part B also covers preventive services, including health care to prevent illness or to detect it at an early stage. It covers flu shots and a yearly wellness visit, as well as colorectal cancer screenings, mammograms, prostate cancer screenings and other tests for people of certain ages or risk groups.
The deductible and copayments don’t apply to preventive services. You generally don’t have to pay anything if you get the services from a health care provider who accepts assignment, which means that the doctor agrees to accept the payment amount Medicare approves for the service.
Doctors who don’t accept assignment can charge up to 15 percent above the Medicare-approved amount for the service, which you would have to pay in addition to the 20 percent copayment for doctor’s services. Most doctors accept assignment.
Keep in mind
To cover some out-of-pocket expenses, you can purchase a Medigap plan, also called Medicare supplement insurance, if you decide to enroll in original Medicare.
If you need financial assistance, you may qualify for help from one of the Medicare Savings Programs in your state, depending on your income and assets.
A Medicare Advantage plan, which may have different out-of-pocket costs, is another option. Private insurance companies offer Medicare Advantage plans that Medicare approves, and they bundle together Part A hospital coverage, Part B doctor and outpatient services, and usually Part D prescription drug coverage into one plan that may have an additional premium. If you decide to get coverage through a Medicare Advantage plan, you’ll still have to enroll in Medicare parts A and B, and pay the Part B premiums and any Part A premiums that may be required.
Updated December 23, 2022
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