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Part A & Part B Cost Explained

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Medicare Part A

Part A (Hospital Insurance) helps pay for inpatient care in a hospital or a limited amount of time in a skilled nursing facility following a hospital stay. It also may pay for home health care or hospice care.

Premium-Free Part A

Most people are able to qualify for “premium-free Part A Medicare” (Hospital Insurance.) This means that there is no monthly premium required if you or your spouse paid Medicare taxes for a certain amount of time while working.

You may be eligible for premium-free Part A once you are 65 if:

  • You receive retirement benefits (or are eligible to receive retirement benefits) from Social Security or the Railroad Retirement Board
  • You or your spouse had Medicare-covered government employment

Part A Premiums

You can choose to buy Part A benefits if you do not qualify for premium-free Part A. In 2022, people will pay either $274 or $499/month. The amount you pay will depend on how long you or your spouse paid Medicare taxes while working. You can still purchase Part B benefits if you choose NOT to buy Part A.

If you choose to purchase Part A, you typically must also purchase Part B (Medical Insurance) and pay the month premiums for both Part A and Part B insurance.


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Medicare Part B

This pays for outpatient care, home health care, services provided by a health care provider, medical equipment, and preventative services.

Part B Premiums

Part B requires a premium payment each month. The standard Part B premium amount in 2021 is $170.10. This is the amount that most people pay. However, if your modified adjusted gross income is above a certain amount, you may pay an Income Related Monthly Adjustment Amount (IRMAA.) This adjustment will be made based on your IRS tax return from 2 years ago.

Part B Deductible & Coinsurance

You will pay $233 dollars for your Part B deductible. After you meet your deductible, you will typically pay 20% of the Medicare-approved amount for:

-Doctors services

-Outpatient therapy

-Durable Medical Equipment

The Cost of Original Medicare

Original Medicare is funded by the government.

Most people 65 and older are eligible for free Medicare Part A- medical hospital insurance if they have worked and paid Medicare taxes long enough. Part B insurance requires a monthly premium. Higher incomes may require a higher monthly Part B premium.

Generally, you can receive your healthcare from any healthcare provider, hospital, or facility that is enrolled in Medicare and accepting new Medicare patients.

In Original Medicare, a primary care doctor is not required.

Most prescriptions aren’t covered in Original Medicare, aside from a few exemptions. Drug coverage can be added through Medicare drug plan (part D).