Q. How much does Medicare cost?
The Short Answer
Medicare is split into different Parts. Part A is generally free, and Part B has a monthly premium. In addition to Part A and Part B, you may elect to purchase a Medicare supplement insurance plan, which will have a monthly premium.
Alternatively, you may elect to enroll in a Medicare Advantage plan. You will still need to pay the Part B premium, and there may or may not be an additional monthly premium for your Medicare Advantage plan.
Here are the specific rules for Part A and Part B of Medicare:
Part A (Hospital Insurance) – Free to anyone who has paid Federal Insurance Contribution Act (FICA) tax for 10 years or 40 quarters. That’s the federal employment tax you and your employer paid while working. It funds Social Security and Medicare. The rules are slightly different for railroad employees.
You can still get Part A if you haven’t met these requirements but you will pay a premium. There is a 10 percent late penalty if you don’t enroll when you’re first eligible. You have to pay that premium for twice the number of years you could have had Part A, but didn’t sign up.
- Part B (Medical Insurance) Everyone is required to pay a premium for this coverage. The federal government sets the amount each year. You can have it deducted from your Social Security benefits.