How Much Does Medicare Cost?

The cost of each part of Medicare can vary depending on the taxes you've paid, your past income, how long you've been covered, your location, your health history, and your age. In 2022, Medicare Part A premium usually costs $0 but can be $274 or $499 a month based on how long you worked and your taxes. There will also be a $1,556 deductible for Part A for every benefit period. The Part B premium for 2022 is typically $170.10 a year with a deductible of $233. The cost of Medicare Advantage (Part C) includes the premiums for Part A and Part B plus an additional monthly premium for the plan itself that averages at $19 in 2022. The average premium for Medicare Part D is $33, but you must also pay for the premiums of part A and B as well. There are also Medicare supplements (Medigap) which averaged $150 a month in 2020. And remember, you could incur a penalty for enrolling in Medicare late for Part A, B, and D. If you're interested in Medicare, below is an in-depth look at the costs so you can make the best decision for your life and your wallet.

On This Page

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  How Much Does Each Medicare Plan Cost in 2022?

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  Medicare Costs 2022 - Part A (Hospital)

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  Medicare Costs 2022 - Part B (Medical)

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  Medicare Costs 2022 - Part C (Advantage Plan)

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  Medicare Costs 2022 - Part D (Prescription Drug Coverage)

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  Costs of Medicare Supplements (Medigap)

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  Are Prescription Drugs Covered by Medigap?

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  Changes to Medicare Costs in 2022

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  Penalties for Late Enrollment

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  Medicare FAQs

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  Understand Your Options and Make Sure You're Covered

How Much Does Each Medicare Plan Cost in 2022?

Medicare consists of several parts. Each part has its own cost. Below is a breakdown of these costs associated with each part of Medicare in 2022 as per Medicare.gov.

Medicare Part A premium usually costs $0 but can be $274 or $499 a month based on how long you worked and your taxes.

Medicare Costs 2022 - Part A (Hospital)

Most people ages 65 and older qualify for premium-free coverage, meaning they get Part A Medicare for a $0 monthly premium. You most likely qualify if you are eligible or already receive retirement benefits from Social Security or *Railroad Retirement. If you don't qualify for premium-free coverage, you can still buy Part A for either $274 a month or $499 a month depending on how long you or your spouse worked and paid Medicare taxes.

Another cost that you will encounter with Part A coverage is the deductible. This is an out-of-pocket expense that you pay per benefit period whenever you are admitted to the hospital. However, it is possible for Medicare supplements (Medigap) to cover the costs of copays.

Copayments can add up to be the most expensive part of your Part A coverage if you find yourself with long hospital or skilled nursing facility stays. These copayments are billed after you pay your deductible. The first 60 days of inpatient hospital or skilled nursing facility care are billed at no additional charge. Days 61-90 will cost you $389 per day, and days 91 and beyond will cost you $778 per day while using your 60 lifetime reserve days. Any time you spend inpatient after utilizing your lifetime reserve days you will pay the full cost of care.

*The Railroad Retirement Program offers retirement, sickness, survivor, and unemployment benefits to those who have spent most of their career in railroad employment, including their families.

Medicare Costs 2022 - Part B (Medical)

Medicare Part B helps cover medical services like doctors visits, lab work and tests, outpatient services, home health services, and more. It is a voluntary program that requires you to have Part A of Medicare in order to enroll. Most people qualify for a standard monthly premium of $170.10, an increase from last year's $148.50 monthly premium. The cost could be higher depending on your income. Below shows premium amounts based on tax returns as per Medicare.gov.

The 2022 deductible for Part B is $233 for the year. Medicare Part B also has something known as *coinsurance. In the case of Part B, your coinsurance cost is 20 percent. This means that once you have paid your deductible of $233 for the year, Medicare will pay 80 percent of the Medicare-approved amount for covered services, and you will pay the remaining 20 percent.

The Part B premium for 2022 is typically $170.10 a year with a deductible of $233.

*Coinsurance refers to a percentage you pay for a covered healthcare service. This occurs after you've paid your deductible. A common example of this is 20/80, meaning you will pay 20% of a covered procedure while the insurance company pays the remaining 80%.

Medicare Costs 2022 - Part C (Advantage Plan)

Medicare Part C, also known as Medicare Advantage, is offered by private insurance companies and combines Medicare Part A (hospital insurance), Part B (medical insurance), and usually Part D (prescription drug coverage). There are some Part C plans that do not offer prescription drug coverage in which case you would have to purchase a separate Part D plan. If your Advantage plan is an HMO or PPO, you cannot get Part D coverage without being unenrolled in Part C. You would then be enrolled in Original Medicare Part A and B if this happens.

Most Advantage plans also offer extra benefits like vision, hearing, and dental. In order to purchase a Medicare Advantage plan, you will need to be enrolled in Medicare Part A and B. The premiums associated with Part A and B will need to be paid in addition to the Part C premium.

Below is a breakdown of what commonly factors into the cost of Medicare Advantage Part C.

Medicare Advantage Cost Breakdown

• Part A - Usually a $0 premium. However, premiums could be $274 or $499 based on how long you worked and the taxes you paid

• Part B - Average 2022 monthly premium is $170.10

• Part C - Average 2022 monthly premium is $19

Below is a table showing the difference in the total monthly premiums between Medicare Advantage, which includes Part A and B, and Original Medicare+Medigap (Medicare supplement)+Part D (prescription drugs). The numbers listed are presented as a range of premium costs.

Note: Data was collected by Medicare.gov based on the four most populated cities in the United States.

Medicare Costs 2022 - Part D (Prescription Drug Coverage)

Medicare Part D is prescription drug coverage that is offered by private insurance companies that have been approved by Medicare. Costs will vary from state to state, but also from one carrier to another, and of course based upon the plan you choose. As with Part B, monthly premiums are also based on your income.

In order to qualify for Part D, you must also be enrolled in the Original Medicare Program (Part A and Part B). Part D is not typically needed with most Medicare Advantage (Part C) plans because Part C usually comes with prescription drug coverage. However, not all Part C plans do. If your Medicare Advantage plan doesn't, you can purchase an additional Part D plan as long as your Medicare Advantage plan is not an HMO or PPO. If this is the case, you will be unenrolled in Medicare Advantage and be switched to Original Medicare Part A and B.

The average basic premium for Part D in 2022 is $33 per month. You will need to pay the Part D premium as well as the premiums of Part A and B if there are any. Deductibles will vary based upon your plan but Medicare has placed a cap of no more than $480 per year for Part D. Some Part D plans have zero deductible for certain prescriptions or tiers of drugs. Coinsurance and copay costs also vary based on your plan and the type of drug. Below is a breakdown of the monthly premium payments based on tax filings as per Medicare.gov.

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Costs of Medicare Supplements (Medigap)

Medigap is supplemental insurance offered by private insurance companies that helps cover "gaps" in your Original Medicare plan. Medigap does not include prescription drug coverage. Medigap can help cover coinsurance, copays, and deductibles. You must be enrolled in both Medicare Part A and Part B in order to get Medigap. You will also need to pay the premiums for Part A and B, if there are any, along with the monthly premium for Medigap. You cannot buy Medigap if you have Medicare Advantage.

The costs for Medicare Supplemental Insurance vary from one insurance company to another. However, the average cost of Medigap in 2020 was $150 a month. Costs for Medigap can be priced in three ways:

• Community-rated - The monthly premium is the same for all enrollees, regardless of age.

• Issue-age-rated - The monthly premium is based on your age when you purchase the Medigap policy.

• Attained-age-rated - The monthly premium is based on your current age, causing your premium to rise as you get older.

Medigap is broken up into several plans. These plans are completely separate from Medicare Part A, B, C, and D. Below is a table that breaks down each Medigap plan and what it will cover according to Medicare.gov.

Medicare Advantage (Part C) includes the premiums for Part A and Part B plus $19 a month.

The average premium for Medicare Part D is $33, but you must also pay for the premiums of part A and B as well.

*An excess charge occurs when a doctor or other health care provider charges more than the Medicare-approved amount for a service. That difference is known as an excess charge which you must pay.

Are Prescription Drugs Covered by Medigap?

No. Medigap does not cover prescription drugs. Prescription drug coverage through Medigap has not been offered since 2006. In order to get prescription drug coverage, you will either need to purchase a Part D plan along with your Original Medicare or a Medicare Advantage plan which usually comes with prescription drug coverage.

Changes to Medicare Costs in 2022

There are several changes to the cost of Medicare made in 2022. They include:

• Increase in Part B premium - The monthly premium for Part B has been increased from $148.50 to $170.10.

• Rising Deductibles - The Part A inpatient deductible for hospital admission has increased from $1,484 to $1,556. The annual Part B deductible has increased from $203 to $233. The federal government has also capped the Part D annual deductible at $480.

• Decrease in Part C premium - The average monthly premium for Part C (Medicare Advantage) has dropped from $21.22 to $19.

Penalties for Late Enrollment

Most parts of Medicare have enrollment penalties. Below is a breakdown of what these penalties are according to Medicare.gov.

Understand Your Options and Make Sure You're Covered

Each part of Medicare varies in cost depending on your income, your taxes, your insurance company, your location, your age, your health, and how long you've had the coverage. You can only qualify for Part C and Part D if you are enrolled in Original Medicare, Parts A and B. Premiums for Part A in 2022 are usually $0 but can be as high as $499 with a deductible of $1,556. The premium for Part B in 2022 is usually $170.10 with a $233 deductible. Part C, which covers Medicare Part A and B, has a monthly premium that averages $19. This premium is paid in addition to the premiums for A and B. The 2022 Part D premium averages at $33 and is paid in addition to the Part A and Part B premiums. Medicare supplements (Medigap) averaged $150 a month in 2020. Remember, there are penalties for late enrollment for Parts A, B, and D of Medicare.

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