Medicare Hospital Insurance (Part A) is free to most beneficiaries. Premiums for Medicare Medical Insurance (Part B) and Medicare Prescription Drug Plans (Part D) depend on a beneficiary’s income. Beneficiaries with a higher income pay a higher premium; however, this affects less than 5 percent of Medicare beneficiaries. Beneficiaries with incomes above $85,000 per year (for a single person) and above $170,000 per year (for a married couple) pay higher Part B premiums.
To determine if a beneficiary will pay a higher premium, the Social Security Administration looks at a beneficiary’s most recent federal tax information. If a beneficiary has to pay a higher premium, the adjustment will be based on a sliding scale that is based on the Modified Adjusted Gross Income (MAGI), which is a beneficiary???s total adjusted gross income and tax-exempt interest income.
Medicare pays 75 percent of participants’ Part B premium, while participants are responsible for 25 percent. The standard Part B premium for 2013 is $104.90. For 2012, most people pay a Medicare Medical Insurance (Part B) premium of $104.90 per month if they had the premium deducted from their Social Security checks. The premium is higher for individuals with incomes above $85,000 per year and for married couples with incomes above $170,000 per year.
Beneficiaries filing an individual tax return pay a monthly premium of $146.90 if their income is $85,001-$107,000; $209.80 if their income is 107,001-160,000; $272.70 if their income is $160,001-$214,000; $335.70 if their income is above $214,000.
For beneficiaries filing jointly, the 2012 Part B monthly premium is $146.90 if their income is $170,001-$214,000; $209.80 if their income is $214,001-$320,000; $272.70 if their income is $320,001-$428,000; and $335.70 if their income is above $428,000.
Beneficiaries who are married but file separate tax returns pay $272.70 if their income is $85,001-$129,000; and $335.70 if their income is above $129.
Will Medicare Medical Insurance (Part B) Premiums Change From Year to Year?
Does Medicare Cover All of Beneficiaries’ Medical Expenses After Age 65?
How Much Does a Medicare Advantage Plan (Part C) Cost for Beneficiaries?