If you’re a Medicare beneficiary or will be soon, you likely have questions about Medicare’s costs. First, Medicare is not free, and costs change annually. We will go over all aspects of Medicare cost-sharing including premiums, deductibles, coinsurances, and copayments for all parts of Medicare and give you a glimpse at what you can expect to pay out-of-pocket in 2022.
How Much Does Medicare Cost in 2022?
Each year, Medicare updates their costs. Typically, beneficiaries will see an increase in Medicare costs year-over-year. However, this usually comes alongside a raise in Social Security benefits. The rate increase for 2022 is Medicare’s largest in years.
See the chart below for 2022 Medicare costs at a glance.
|2022 Medicare Costs at a Glance|
|Medicare Part A Premium||If you or your spouse paid Medicare tax for 40 working quarters (10 years), you qualify for premium-free Medicare Part A. Those who do not meet this requirement could pay up to $499 each month for coverage.|
|Medicare Part A Deductible and Coinsurance||
|Medicare Part B Premium||Standard Medicare Part B Premium: $170.10. This could be higher based on income (IRMAA applies).|
|Medicare Part B Deductible and Coinsurance||The 2022 annual Medicare Part B deductible is $233. After you meet the deductible, you’re responsible for 20% coinsurance for the Medicare-approved amount for medical services and equipment.|
|Medicare Part C Premium, Coinsurance, and Deductible||The Medicare Part C (Medicare Advantage) premium, coinsurance, and deductible vary by plan.|
|Medicare Part D Premium, Coinsurance, and Deductible||The Medicare Part D (prescription drug plan) premium, coinsurance, and deductible vary by plan, however, the maximum Medicare Part D deductible in 2022 is $480 and IRMAA also applies to Medicare Part D premiums for higher-income earners.|
Medicare Income Limits for 2022
Your Medicare Part B premium is based on your income from the last two years. The standard Medicare Part B premium can go up for those with a higher income.
The Income Related Monthly Adjustment Amount (IRMAA) is a predetermined amount added to your monthly Medicare Part B premium based on your income bracket from two tax returns ago. To see if your annual income will necessitate a higher premium, refer to an IRMAA chart for Medicare Part B premiums.
If you are assessed an IRMAA charge and recently had a decrease in income due to an event such as retirement or the loss of your spouse, you can file an IRMAA appeal for your local Social Security department to review.
Medicare Part C Cost
All Medicare Advantage plans have different premium, copay, deductible, and coinsurance amounts. Many Medicare Advantage plans across the nation have a $0 premium or a low monthly cost in general. While this coverage can seem appealing to many Americans, there are numerous misconceptions when it comes to Medicare Advantage plans. Saving on the premium is a great perk, however these plan often come with high maximum out-of-pocket limits, as well as doctor and hospital restrictions.
Medicare Part D Costs
Just like Medicare Part B, Medicare Part D charges high-income earners heftier monthly premiums for coverage. So, you may see an increase in your monthly Medicare Part D premium as compared to what Medicare.gov lists.
The national base beneficiary premium in 2022 is $33.37. Then, the maximum deductible for any Medicare Part D policy is $480. However, each plan is different. Some prescription drug plans have deductibles as low as $0.
The medication you take is what will determine the best Medicare Part D plan for you. Drugs tiers determine cost for medications. Typically, higher specialty tier drugs cost the most and lower tier medications are available at a lower cost. While in the donut hole, you’ll pay more than usual for your medications. However, not everyone falls into this coverage gap.
How to Find Out More About Medicare Costs in 2022
It is important to stay on top of Medicare costs each year so you can budget for your health care. In retirement, insurance should not have to be top-of-mind – let us handle it for you. Give us a call to learn more about costs and all your coverage options.
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