Learn how your Medicare premiums for government assisted health care can increase every year. Understand when Medicare payments are adjusted.
The amount of Medicare premiums are calculated on an annual basis. The formula that Social Security uses includes a number of factors like inflation of medical costs and total adjusted family income. Those individuals who are enrolled in Medicare Parts A, B, or D will be informed of new premium changes by December. New premium rates become effective each year in January. Medicare Part C payments are determined by private insurance firms and will cover all of Part A, B, and D plans. Read all the details at: http://www.medicare.gov/cost/ .
The majority of individuals who qualify for Medicare coverage will be covered by Part A (hospital insurance) without a monthly premium payment. For those individuals who need to pay a premium, there is only one amount that everyone pays. As with all Medicare parts, the monthly premium amount is adjusted annually and becomes effective each January.
Medicare Part B (medical insurance) premiums are based on the adjusted gross income of an individual or a couple and are recalculated annually. Basically the more the income, the more the premiums will be. There is a maximum premium for individuals having income of $215,000 or more and for couples with income of $428,000 or more. The Social Security Administration will notify Medicare participants of new annual increases by December each year. New rates become effective each year in January.
Medicare Part C (Medicare advantage plans) is coverage provided by private insurance companies and monthly premiums are paid directly to the insurance companies. The uniqueness of Part C is that the plan covers all three major Medicare plans, Parts A, B, and D. Participants in Part C will be notified annually of pending premium increases before they become effective each year in January.
Medicare Part D (prescription drug coverage) is a plan covered by private insurance companies. Monthly premiums are dictated by the individual insurance companies. Depending on the adjusted gross income of an individual or a couple, there may be an additional monthly fee from Medicare. There is a maximum additional fee for individuals with income of $215,000 or more and for couples with income of $428,000 or more. Both plan premiums and additional fees are calculated annually. Enrollees will be notified prior to new rates becoming effective each year in January.