Medicare Costs: Premiums, Deductibles & Out-of-Pocket Expenses
Medicare provides excellent coverage, but it’s not free. Understanding what you’ll pay helps you budget with confidence and avoid surprises. I’m Jake McGeoy, your local Medicare agent, and I’ll break down the key costs in plain English.
Medicare Part A Costs (Hospital Insurance)
Premium: Most people get Part A for free if they or their spouse paid Medicare taxes while working.
Deductible (2025): $1,632 per benefit period.
Coinsurance:
Days 1–60 in hospital: $0
Days 61–90: $408 per day
Days 91+: $816 per “lifetime reserve” day (up to 60 total days)
Skilled nursing facilities also have coinsurance starting after 20 days.
Medicare Part B Costs (Medical Insurance)
Monthly Premium (2025): Standard amount is $174.70, but may be higher for individuals with higher incomes (IRMAA).
Annual Deductible: $240 (after that, Medicare pays 80%, you pay 20%).
Coinsurance: Typically 20% of covered services like doctor visits, outpatient care, and tests.
Medicare Part C (Medicare Advantage) Costs
Monthly Premium: Varies by plan — some are $0, others have additional costs.
Copays/Coinsurance: Set by your plan (may include small copays for doctor visits, ER visits, prescriptions, etc.).
Out-of-Pocket Maximum: Advantage plans cap what you pay each year (usually between $4,000–$8,000).
Medicare Part D (Prescription Drug Coverage) Costs
Monthly Premium: $0–$60+, depending on plan.
Annual Deductible: Up to $545 (varies by plan and drug tier).
Copays/Coinsurance: Varies based on medication tier (generic, brand, specialty).
Catastrophic Coverage: After reaching your out-of-pocket threshold, you pay nothing for covered drugs.
Medigap (Medicare Supplement) Costs
Monthly premium depends on your age, location, and plan choice.
Medigap helps cover deductibles, copays, and coinsurance that Medicare doesn’t — giving you predictable, lower out-of-pocket costs.
Budgeting for Medicare: What to Expect
Most people pay Part B premiums + optional Part D or Advantage premiums.
If you choose a Medigap plan, expect an additional monthly premium — but you’ll have far fewer unexpected bills.
Medicare Advantage plans often trade lower premiums for higher copays when you use services.
Need Help Choosing the Right Cost Structure?
I’ll compare options side by side so you can see which path works best for your health needs and budget.
Call Jake McGeoy at 443-797-3923 for a free Medicare cost review — no pressure, just straightforward guidance.