Does my income affect my Medicare Cost?If you earn a certain level of income, the law requires an adjustment to your monthly Medicare Part B (medical insurance) and Medicare prescription drug coverage premiums.

This is called an income-related monthly adjustment amount.

These beneficiaries, who account for about five percent of people with Medicare,  pay higher premiums for Part B and Prescription Drug Program (PDP) coverage.

Here’s how it works

Part B helps pay for your doctors’ services and outpatient care. It also covers other medical services, such as physical and occupational therapy, and some home health care. For most beneficiaries, the government pays about 75 percent of the Part B premium and the beneficiary pays the remaining 25 percent.

On the other hand, you can expect to pay a larger percentage of the total cost of Part B if the income you report to the Internal Revenue Service (IRS) is considered higher-level. You’ll pay monthly Part B premiums equal to 35, 50, 65, or 80 percent of the total cost.

Medicare prescription drug coverage helps cover your prescription drugs. For most beneficiaries, the government pays a major portion of the total cost and the beneficiary pays the rest. Prescription Drug Program costs vary depending on the plan, and whether you get Extra Help with your portion of the Medicare PDP.

Read More: What is the Medicare Deductible?
Learn About:  When Can I Enroll in Medicare Part A and/or Part B?
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