Is Medicare Free for Older Adults?
Key takeaways:
Medicare is not completely free for older adults. You may have to pay for premiums, copays, deductibles, coinsurance, and other items not covered by original Medicare.
If you meet the work requirements, you may qualify for premium-free Part A.
You can get help paying for Medicare Part B (medical insurance) and Part D (prescription medication coverage) if you have limited income and resources.
Table of contents
Turning 65 is a major milestone, particularly when it comes to healthcare. You’re eligible to enroll in Medicare and receive many benefits, such as telehealth services and nutrition therapy, if you qualify. But you may have to pay some out-of-pocket costs, depending on your situation.
Is Medicare completely free for older adults?
No. Many people think that Medicare is completely free, but this is not the case. Your expenses will vary based on the plan you join. Under original Medicare (Parts A and B), there is no limit to the out-of-pocket expenses you may have to pay every year.
If you buy supplemental coverage, such as Medigap, your policy can pay for expenses such as deductibles and copayments that original Medicare doesn’t cover. Another option is to join a Medicare Advantage plan offered through a private insurance company to obtain additional benefits, such as vision, dental, and hearing.
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What do the different Medicare parts cover?
Medicare has four major parts: A, B, C, and D. Medicare Parts A and B come together to form original Medicare. Part C, also known as Medicare Advantage, is an alternative to original Medicare. It provides Part A and Part B benefits, as well as vision and dental care. Each part of Medicare covers different services and supplies you may receive.
Medicare Part A (hospital insurance): This covers inpatient care, including supplies and hospital services that are part of your treatment.
Medicare Part B (medical insurance): This covers outpatient care, including visits with your healthcare provider and outpatient therapy.
Medicare Part C (Medicare Advantage): This is offered by Medicare-approved private insurance companies. It combines Part A, Part B, and usually Part D into one plan.
Medicare Part D (prescription medication coverage): This helps pay for generic and brand medications at different pharmacies.
Is Medicare Part A free for seniors?
Medicare Part A premiums are free for most people. But if you’re admitted to a hospital or skilled nursing facility, you’ll have to pay a Medicare Part A deductible. And if your hospital stay is longer than 60 days, you’ll have to pay coinsurance each day.
According to the Centers for Medicare & Medicaid Services (CMS), about 99% of Medicare beneficiaries pay $0 for Part A premiums. This is known as “premium-free Part A.” The Medicare Part A premium is the monthly cost you pay to receive benefits.
If you are an older adult, you will not have to pay a premium for Medicare Part A (based on age) if you are:
Age 65 or older
Eligible to receive monthly Railroad Retirement Board cash benefits or Social Security
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You generally need to work for at least 10 years (40 quarter hours) to qualify for Social Security benefits. You can earn up to four credits per year if your income meets the minimum requirements. You can also be eligible for Social Security and qualify for premium-free Part A if your spouse met the requirements.
Costs for Medicare Part A premiums if you don’t meet requirements
If you or your spouse did not work long enough and pay Medicare taxes, you’ll have to pay for Medicare Part A. For 2024, you’ll pay between $278 and $505 per month.
If You Paid Medicare Taxes for: | Your Part A Premiums in 2024 Are: |
Less than 30 quarters | $505 per month |
30-39 quarters | $278 per month |
40 quarters (10 years) | $0 per month |
Is Medicare Part B free for seniors?
It depends. If you qualify for a Medicare Savings Program, you may receive help paying for all or a portion of your Part B. This can include:
Premiums
Deductibles
Copayments
Coinsurance
Your eligibility for a Medicare Savings Program will typically depend on your income and resources, but the requirements can vary by state. These programs help you pay for your healthcare expenses if your income and resources fall under the government guidelines. Some states, however, don’t include certain income or resources in the calculation that determines your eligibility. So it’s important to contact your state’s benefits office to learn more about eligibility requirements.
Costs for Medicare Part B if you don’t meet requirements
If you don’t qualify for a Medicare Savings Program, you’ll pay the following for Part B:
Medicare Part B Costs: | Amount You Pay in 2024: |
Standard premium | $174.70 per month |
Deductible | $240 |
Coinsurance | 20% of the Medicare-approved amount after you meet the deductible |
Can seniors get Medicare Part C for free?
Yes. Some Medicare Advantage (Part C) plans are zero-premium, which means your monthly plan premium is $0. These plans usually cover more benefits than original Medicare, but you don’t have to pay more for coverage. Medicare Advantage plans have the option to pass on savings they receive to members. The availability of these plans varies by state.
Even though your Medicare Advantage monthly premium may be $0, you may still have to pay deductibles, copays, and your Part B premium to receive coverage. The good news, however, is that there is an annual limit on how much you’ll have to pay out of pocket for Medicare Advantage. This is not the case with original Medicare.
Can seniors get Medicare Part D for free?
Yes. If your income and assets are under a certain limit, you may qualify for $0 prescription medication coverage through Extra Help. Some people can get Extra Help automatically, while others have to apply. This Medicare program can help you pay for Medicare Part D. This can include:
Premiums
Deductibles
Coinsurance
Copayments
You will not have to apply for Extra Help if one of these applies to you:
Receive Supplemental Security Income (SSI) benefits
Have full Medicaid coverage
Get help paying for Medicare Part B premiums through a Medicare Savings Program
But if you don’t qualify for Extra Help, you can still receive affordable Medicare Part D plans. The premiums vary based on where you live. For 2024, Part D premiums ranged from less than $1 per month for a nationwide plan to nearly $200 per month for a plan available in Pennsylvania and West Virginia. Part D deductibles vary by plan, but you won’t pay more than $545 in 2024.
How do Medicare premiums work?
Medicare premiums typically increase every year due to inflation and rising healthcare costs. If you meet the work requirements, you won’t have to pay a premium for Part A. The amount you pay for Part B and Part D will depend on your income.
Roughly 92% of people with Medicare Part B pay the standard premium, which is $174.70 per month for 2024. If you have higher income, your monthly Part B premium will be higher. It can range anywhere from $244.60 to $594 per month in 2024, which represents the income-related monthly adjustment amount.
Part D premiums vary based on your plan. If your income exceeds the annual threshold, you will pay more money directly to Medicare, or the amount will be deducted from your Social Security benefit checks.
What out-of-pocket costs can you expect if you have Medicare?
While Medicare covers the cost of many supplies and services for people with health conditions, you still have to pay out-of-pocket costs, such as:
After you pay your Part B deductible, you will usually pay 20% of the Medicare-approved amount for services and supplies. Medicare will typically cover the rest.
Can changing your Medicare plan help save money?
Maybe. Depending on your specific needs, changing your Medicare plan can save you money. Here are a few ways you may be able to reduce your costs:
Access to network discounts: Some Medicare Advantage plans have negotiated lower rates with healthcare providers. The savings are passed on to you when you use in-network services. Also, your plan may offer additional benefits, such as vision, dental, and fitness programs that can help you save on healthcare expenses.
Better medication coverage: Switching to a different Medicare plan may allow you to find a Part D prescription medication program that covers your medications at a lower cost.
Reduced out-of-pocket costs: Medicare plans have varying deductibles, copays and coinsurance for covered services. Select a plan with lower out-of-pocket costs for the specific services you use most often. Over time, this will help curb costs. It also doesn’t hurt if you’re proactive. Watch for any billing errors. If a claim was denied by Medicare, ask your healthcare provider to check to see if it was properly coded.
The bottom line
Medicare is not entirely free. You may still have to pay deductibles, copayments and other out-of-pocket costs for each part of Medicare that you sign up for. But if you have limited income and resources, you may be able to get help paying for your healthcare expenses.
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References
Centers for Medicare & Medicaid Services. (2023). 2024 Medicare Parts A & B premiums and deductibles.
Centers for Medicare & Medicaid Services. (2023). Original Medicare (Part A and B) eligibility and enrollment.
KFF. (2023). An overview of the Medicare Part D prescription drug benefit.
Medicare.gov. (n.d.). Help with drug costs.
Medicare.gov. (n.d.). Medicare savings programs.
Social Security Administration. (n.d.). Eligibility for Social Security in retirement.
Social Security Administration. (n.d.). Premiums: Rules for higher-income beneficiaries.
Social Security Administration. (n.d.). Social Security credits.
