Original Medicare

Original Medicare Costs

Medicare charges monthly premiums according to your work history. Most people get their Medicare Part A premium free, but if you have not paid enough Medicare taxes you will have to pay a monthly premium for Part A. Everyone is subject to a Part B monthly premium. Premiums are usually increased every year.

2017 Part A Premiums:

  • $0 if you or your spouse paid Medicare taxes through employment in the U.S for 10 years or more
  • If you don't get premium-free Part A, you pay up to maximum of $413 each month

2017 Part A Coinsurance:

Part A Coinsurance is calculated by benefit periods. Benefit periods begin the first day you receive inpatient care and end when you have been out of the skilled nursing facility or hospital you were admitted to for 60 consecutive days. You can have more than one benefit period in a given year. Coinsurance costs are listed below:

  • $0 for days 0-60 of each benefit period
  • $329 per day for days 61-90 of each benefit period
  • $658 per day for days 91-150

Medicare provides 60 lifetime reserve days per recipient. These reserve days go into effect after you have been in a hospital for over 90 consecutive days and are non-renewable.

2017 Part A Skilled Nursing Facility (SNF) Stay Coinsurance:

  • $0 for days 0-20 of each benefit period
  • $164.50 per day for days 21-100 of each benefit period

2017 Part A Deductible:

  • $1,316 per benefit period

2017 Part B Premiums

  • $134 per month for those with incomes lower than $70,000 per year individually and $170,000 per couple
  • $187.50 per month for those with incomes between $85,001-$107,000 per year individually and $170,001-$214,000 per couple
  • $267.90 per month for those with incomes between $107,001-$160,000 per year individually and $214,001-$320,000
  • $348.30 per month for those with incomes between $160,001-$214,000 individually and $320,001-$428,000
  • $428.60 per month for those with incomes above $214,000 individually and $428,000 per couple

Your Part B premiums are figured by your AGI (adjusted gross income) on your IRS tax return from two years prior. If you feel that the Social Security department has made an error in your premium amount or your finances have changed, you can submit evidence to the Social Security office and request your premium be reduced.

2017 Part B Deductible:

  • $183 annually

Services:

Your charges for monthly services depends on what you are receiving and if your doctor accepts assignment (the Medicare approved amount) as payment in full. See Medicare Charges by Service(link)

Am I protected from paying increasing Part B premiums?

The Part B premium is set each year by CMS (the Centers for Medicare & Medicaid Services). You may be protected from paying annual increases by the "hold harmless provision".

If your Part B premium is deducted from your Social Security benefits every month, which is standard for most Medicare recipients, the provision will protect you from paying increases if:

  1. You were entitled to Social Security benefits in November and December of previous year (2016)
  2. Your Medicare Part B premium was deducted from your Social Security benefits from November 2016 – January 2017
  3. You are not already paying higher Part B premiums due to IRMAA (Income-Related Monthly Adjustment Amount)
  4. You are not receiving a large enough COLA (Cost of Living Adjustment) to pay for the increase in premium. COLA is an additional payment through Social Security to protect recipients from the effects of inflation.

You are not protected by the provision if:

  1. You are newly eligible or enrolled into Medicare
  2. Your income is high enough you are paying higher Part B premiums (IRMAA)
  3. You have an MSP (Medicare Savings Program).
  4. You had an MSP in 2016 but did not recertify, causing you to lose the program.

If you are subject to a Part B late enrollment penalty but qualify for the hold harmless provision, you will still have to pay the penalty. Your penalty will also be based on the newly increased amount instead of the amount protected by the hold harmless provision.

How do I qualify for Premium-Free Part A?

You qualify for premium-free Part A if you are over 65 and meet the following requirements:

  • You, a spouse, or a former spouse have paid Social Security taxes through employment in the U.S. for at least 10 years (40 calendar quarters)
  • Premium-free Part A from a spouse’s work history must additional criteria(link)
  • You are eligible for Railroad Retirement Benefits
  • You were a state or local employee after March 31, 1986
  • You were a federal employee after December 31, 1982

You qualify for premium-free Part A if you are under 65 and meet one of the following conditions:

  • You are eligible for Medicare because you are disabled
  • You have been diagnosed with ESRD (End-Stage Renal Disease)
  • You have been diagnosed with ALS (Amyotrophic Lateral Sclerosis)

You can keep your Medicare coverage if you return to work but are still considered medically disabled; however, you will have to pay the Medicare Part A premium after the first 8.5 years. If your income is too low, you can see if you qualify for the QDWI (Qualified Disabled and Working Individuals) plan.

What are the additional requirements for my spouse’s work history qualifying me for premium-free Part A?

You can qualify for premium-free Part A based on your spouse’s work history when you turn 65 and meet one of the following conditions:

  • You have been married to your current spouse for at least one year, and they are eligible for Social Security benefits either by disability or retirement.
  • You were married to your former spouse for at least ten year and they are eligible for Social Security either by disability or retirement. You must be legally divorced and currently single.
  • You were married to your spouse for at least nine months prior to becoming widowed. You must also be single.