- A premium is a periodic payment made to a health insurance plan in exchange for coverage. In the context of Medicare, premiums are paid by beneficiaries for various types of coverage, including Part A (hospital insurance), Part B (medical insurance), and Medicare Advantage or Medigap plans.
- Under Original Medicare (consisting of Part A and Part B), beneficiaries are generally required to pay a premium for Part B coverage. The Part B premium is based on the beneficiary’s income and is typically deducted from their Social Security benefit payment.
- For Medicare Part A coverage, most beneficiaries are not required to pay a premium because they or a spouse have paid Medicare taxes while working. However, some beneficiaries may be required to pay a premium if they do not meet the eligibility requirements based on their work history.
- In addition to the Part A and Part B premiums, beneficiaries may also choose to enroll in a Medicare Advantage or Medigap plan, which is a private health insurance plan that is an alternative to Original Medicare. These plans may have different out-of-pocket costs and may offer additional benefits. Premiums for Medicare Advantage plans vary depending on the specific plan chosen.
- Overall, premiums are a periodic payment made by beneficiaries in exchange for coverage under Medicare. It’s important for beneficiaries to understand the premiums associated with the various types of coverage available to them and to carefully consider their coverage options.
