Medicare Part B Costs in 2018

How to Budget Your Health Expenses

Part B Costs 2016
Part B premiums increase for some seniors but not all. Rob Melnychuk/DigitalVision/Getty Images

Part B is what covers the bulk of your healthcare expenses. Understand how much you will pay out of pocket and budget for the year ahead.

Part B Deductible

The annual deductible for Part B is $183 in 2018, unchanged from 2017. You are required to pay the full deductible amount before Medicare will start paying towards your health expenses.

Part B Premiums

You pay monthly premiums for Medicare.

If you do not pay your premiums in a timely manner, your coverage will be taken away. You are given a 90-day grace period to make payments before your Part B coverage is canceled.

In 2018, Part B premium rates stay the same across five income brackets.

What has changed are the income brackets themselves. Many people may be surprised to find out they are paying considerably more for the same income. The first two income brackets remain unchanged, and price hikes hit are intended to hit those with greater financial means.

* Note that income brackets are based on your last completed income tax return. For 2018, please refer to your 2016 filing.

2018 Part B Premiums for Individuals

The income bracket threshold for individuals has decreased by $54,000 per year.

Income Bracket in 2018Income Bracket in 2017Your Costs
Less than $85,000Less than $85,000$134.00 per month
$85,000 - $107,000$85,000 - $107,000$187.50 per month
$107,000 - $133,500$107,000 - $160,000$267.90 per month
$133,500 - $160,000$160,000 - $214,000$348.30 per month
More than $160,000More than $214,000$428.60 per month

If you earned $134,000, you would have paid $267.90 per month in 2017 but would pay $348.30 per month in 2018, an additional $965 per year. If you earned $161,000, you would have paid $384.30 per month in 2017 and $428.60 in 2018, an additional $964 per month. 

2018 Part B Premiums for Married Couples

The income bracket threshold for a married couple has decreased by $108,000 per year.

Income Bracket in 2018Income Bracet in 2017Your Costs
Less than $170,000Less than $170,000$134.00 per month
$170,000 - $214,000$170,000 - $214,000$187.50 per month
$214,000 - $267,000$214,000 - $320,000$267.90 per month
$267,000 - $320,000$320,000 - $428,000$348.30 per month
More than $320,000More than $428,000$428.60 per month

If a couple earned $268,000, you would have paid $267.90 per month in 2017 but would pay $348.30 per month in 2018, an additional $965 per year. If you earned $321,000, you would have paid $384.30 per month in 2017 and $428.60 in 2018, an additional $964 per month. 

2018 Part B Premiums for Married People Filing as Individuals

An entire income bracket was removed for married people filing as individuals. You either earn above or below $85,000.

Income Bracket in 2018Income Bracket in 2017Your Costs in 2018
Less than $85,000Less than $85,000$134.00 per month
Greater than $85,000$85,000 - $129,000$428.60 per month
 Greater than $129,000 

In 2017, you would have paid $348.30 per month if your income was $86,000. That number is now increased to $428.60, adding another $964 per month. If they had filed as a single individual, you would have only paid $187.50 per month. It is sad to think that someone could pay less if they were divorced rather than separated.

In this way, a married individual is the one with the most at stake.

Part B Premiums and Social Security

You cannot be expected to pay more for Medicare if there is not also a rise in Social Security benefits. The holds harmless provision protects Social Security recipients from paying higher premiums if they meet certain criteria.

  • You were entitled to Social Security benefits as of November the previous year.
  • Your Medicare Part B premiums were directly deducted from your Social Security check from November the previous year to January the current year.
  • Any Social Security cost of living adjustment (COLA) increase is not enough to cover the cost of the premium increase.
  • You are in the lowest income category.

The Social Security COLA for 2018 is 2 percent. Without an increase in premiums for the lowest income bracket, you are expected to pay the listed rate. In 2017, the COLA amount was only 0.3%, not enough to cover the cost of the premium increase that year. Beneficiaries who met the above criteria were allowed to pay the 2016 Part B premium rate of $121.80 per month.

For those who are dual eligible, Medicaid will pay their Medicare premiums. They will be charged the higher Part B premium rates.

Part B Premiums and Medicare Advantage

You can elect to have Original Medicare (Parts A and B) or a Medicare Advantage plan (Part C). Medicare Advantage plans are offered by private insurance companies and will cover everything that Original Medicare offers and more.

Even if you decide on a Medicare Advantage plan and pay premiums to the insurance company, you still have to pay Part B premiums to the government. You must take that added cost into consideration.

Part B Coinsurance

The Part B coinsurance remains unchanged. Medicare pays 80 percent and you pay 20 percent with the exception of preventive screening tests. As long as your doctor accepts assignment, your preventive screening tests will be free.

A Word from Verywell

The majority of your healthcare will be paid for by Medicare Part B. Likewise, the majority of your out of pocket expenses will relate to Medicare Part B. Knowing what you are expected to pay for deductibles, premiums, and coinsurance in 2018 will help you to budget appropriately.

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