Key Points
- When determining how much does Medicare cost for beneficiaries, remember most people qualify for premium-free Part A if they have worked 40 quarters in the U.S. and paid Medicare taxes during that time, but if not, there is a monthly premium.
- The Part B and D premiums are based on income, so you could pay more for Part B and Part D if you have a higher income.
- The standard Medicare Part B premium in 2025 is $185.
Overview
How much does Medicare cost? Do you have to pay for Medicare? How are Medicare premiums calculated? Who pays for Medicare Part A? Is Medicare Part B free? What will be my Medicare premiums in 2025?
These are very common questions about the costs of Medicare. The costs for Medicare Part B and Part D, as well as supplemental coverage, are something that many don’t anticipate. It can surprise you when you turn 65 and enroll in Medicare and learn that Medicare is not free.
So, do you have to pay for Medicare? Yes, most people do pay Medicare premiums. Fortunately, it’s fairly easy to put together a Medicare cost estimate so that you can plan ahead.
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How Much is Medicare Part A in 2025
The cost for Medicare Part A for most people is usually zero. If you’ve worked 10+ years (40 quarters) in the U.S., you have already paid for Part A via payroll taxes. (99% of beneficiaries qualify for free Part A.)
If you have to buy Part A, the cost for Medicare Part A will be around $518/month. People with less than 40 quarters of work experience but more than 30 quarters can get a pro-rated premium of $285/month.
To be eligible to buy Part A, you must have been a legal resident or have had a green card for at least 5 years.
This part of Medicare covers your hospital stay. But, should you have a hospital stay, what is the Medicare Part A deductible? In 2025, the Part A Deductible will be $1,676. This is an increase of $44 from the Part A deductible in 2024, which was $1,632. (However, if you have a Medigap plan, it will likely cover this cost for you).
Learn more about costs for Medicare Parts A, B, and D here in our YouTube video:
How Much Does Medicare Part B Cost in 2025
How is Medicare Part B Premium Calculated? The Cost for Medicare Part B is Based on Household Income
Part B is your outpatient medical insurance, but it comes at a cost. Determining what is the premium for Medicare Part B can be tricky as it is based on your modified adjusted household gross income (MAGI). The Social Security office will pull your IRS tax return from two years prior. They use that tax return to determine what you’ll pay for Parts B & D (Part D premiums are also based on income.)
The items that contribute to your modified adjusted gross income include any money earned through wages, interest, dividends from investments, and capital gains. It also includes Social Security benefits and tax-deferred pensions. Distributions from Roth IRAs and Roth 401(k)s, life insurance, reverse mortgages, and health savings accounts do not count in the MAGI calculation.
If you filed jointly with a spouse, Social Security will base your premiums for each of you based on that married income. However, you will EACH pay your own Part B premium. Your premiums for Part B are always individual, not combined. Social Security simply uses your household income to determine where you fall individually in the Part B premiums chart.
Social Security will usually notify you of your next year’s premium annually in December or early January by mail. Fortunately, it is possible to appeal a higher Part B premium charge.
Only about 5% of all Medicare beneficiaries currently pay higher premiums for Medicare Parts B and D.
Refer to this chart to see what you’ll pay in 2025:
It’s a good idea to keep an eye on these Medicare income limits in the future because they may be adjusted every few years. If you also qualify for Original Medicare due to End-Stage Renal Disease and recently had a transplant, you may be interested in the new Part B coverage for immunosuppressive drugs.
In addition to the monthly premium, you’ll also have the Part B deductible and coinsurance for medical services covered by Medicare.
Medicare Cost for Part D for 2025
How much do you pay for Medicare Part D? Just like Part B, your Medicare costs for Part D vary based on income. Your Medicare Part D Premiums for 2025 also vary by plan. Each state may have 20 or more plans to choose from.
You can find plans that start around $10 – $15/month in most states. Whatever the premium is for your plan, that is known as the base premium for Part D.
You will pay the plan’s published base premium unless you are in a higher income bracket. People with higher incomes pay more for Part D. It’s important to factor this in if you are comparing the potential costs for Medicare Part D against other insurance, such as employer insurance. You also don’t want to forget the cost of prescription drugs as well because you will have copays and coinsurance for most drugs.
Medicare Part D Premiums Chart for 2025
To determine your cost for Part D drug plans in 2025, review the table below.
If you find yourself in a higher income bracket because your earlier tax returns showed higher income than you now have after retirement, be sure to read our blog post on how to appeal a higher premium. Appealing the higher premium because you have a qualifying life event can help provide Medicare savings in retirement.
FAQs
The amount for Medicare Part B that you will pay each month will vary based upon your income and the kind of supplemental coverage you choose.
An example would be the base Part B premium of $185/month (in 2025) plus a Medigap Plan G monthly premium of $125/month plus a Part D premium of $27/month – your total would be $337/month in premiums.
Understanding how much does Medicare pay for your healthcare services will be important. With this example you can be sure your additional out-of-pocket spending would be minimal as Plan G would pick up the majority of your out-of-pocket costs.
There are many different Medicare plan options to choose from so that you can have a monthly premium within your budget.
Most people new to Medicare will pay $185 a month for Part B premiums in 2025. This is the standard premium that most people pay based on income. Social Security will deduct your premium from your Social Security check monthly. If you have not enrolled in Social Security income benefits yet, they’ll bill you quarterly.
Since some people pay more based on income, use the tables above to determine your personal premium for Part B. It shows the amount that you will pay in 2025 for Part B, per the numbers released by the federal agency, Centers for Medicare and Medicaid Services.
Additionally, don’t forget you need to know what is the deductible for Medicare Part B each year as well. The Medicare Part B deductible for 2025 is $257.
Some people who get Social Security benefits will still pay less than $185 in 2025. This affects around 2 million Medicare beneficiaries. Legislation prevents the cost of Medicare Part B from increasing more than the Social Security annual cost-of-living increase.
In recent years, we have had low COLA increases, so these individuals have only been paying less than the standard base Part B premium. Though the Social Security COLA increases for the last couple of years have been somewhat larger, there is still a small group of beneficiaries being protected by the “hold harmless” provision.
Though this all very confusing, remember that you do not have to calculate this yourself. Again, Social Security will determine your premium for 2025 and notify you by mail if you exceed the Medicare income limits and must pay a higher adjusted amount.
Most Medicare beneficiaries qualify for premium-free Part A. However, the Medicare Part B premium is deducted from your Social Security check if you are receiving Social Security benefits. In 2025, the standard premium is $185.
You can also request your Part D premium be deducted from your Social Security check.
Most People Pay the Standard Premium
You’ll pay the standard Medicare Part B premium amount if:
- You enroll in Part B for the first time in 2025 or after.
- You don’t get Social Security benefits.
- You’re directly billed for your Part B Medicare premiums.
- You have Medicare and Medicaid, and Medicare pays your premiums. (Your state will pay the standard $185.)
- Your modified adjusted gross income as reported on your IRS tax return from 2 years ago is above a certain amount. If so, you’ll pay the standard premium amount and an Income Related Monthly Adjustment Amount (IRMAA). IRMAA is an extra charge added to your premium.
Yes, once you sign up for Social Security income benefits, your premium for Medicare Part B will be deducted from Social Security payments monthly. This is usually just Part B premiums that are deducted automatically, since most people pay nothing for Part A.
Medicare premiums are tax deductible as part of your medical expenses. If your total medical expenses for the year exceed 10% of your Adjusted Gross Income, then you can deduct them. This essentially then excludes a portion of your income from being taxed.
Always consult a tax professional for guidance before deducting Medicare premiums or any other medical expenses.
How Much Will You Pay for Medicare?
Now if you find all that just a little confusing – don’t worry. Medicare premium increases happen almost every year, and our professionals can help you figure out exactly what your Medicare costs will be. Many people find that Medicare and a Medicare supplement cost less than private insurance they had prior to Medicare. Either way, you’ll want to get some estimates of your costs for Original Medicare before you retire. This way, you can plan ahead to have enough savings for the future.
We can help you determine your potential costs right over the phone and provide you with an average cost of Medicare. We can also help you plan for how much are Medicare premiums and your estimated costs in 2025.
Call (817) 249-8600 today or complete our online request form below. A friendly licensed insurance agent on our team will assist you.
To continue learning about Medicare, go next to: Apply for Medicare
Takeaways
- The standard Part B premium that most people pay is $185 in 2025, but you can pay more if you have a higher income.
- Many beneficiaries qualify for premium-free Part A.
- Your Part D premium is also affected by income.
