Will Your Medicare Payments Increase in 2021?
For those of you updating your budgets for 2021, we’re providing an overview of the price increases you can expect for Medicare in 2021. Fortunately for most, costs aren’t growing much in the new year, but it’s important to keep on top of changes and how they affect your finances.
Changes to Medicare Part A for 2021
If you paid sufficient Medicare taxes and you’re over 65, you’ll most likely qualify for Part A of the Medicare program without paying a premium. If not, and you don’t qualify for Plan A in some other way, you’ll need to pay a premium. Here’s an overview of the changes provided on the Medicare.gov site from 2020 to 2021.
Part A Deductible – In 2021, you’ll pay:
- A $1,484 deductible for each benefit period (up $76 from 2020)
- Days 1-60: $0 coinsurance for each benefit period
- Days 61-90: $371 coinsurance per day of each benefit period (up $19 from 2020)
- Days 91 and beyond: $742 coinsurance per each "lifetime reserve day" after day 90 for each benefit period (up $36 from 2020)
- Beyond lifetime reserve days: all costs
Part A Premium – If you buy Part A, you'll pay up to $471 each month in 2021 if you paid Medicare taxes for less than 30 quarters (up $13 from 2020). If you paid Medicare taxes for 30-39 quarters, the standard Part A premium is $259 (up $7 from 2020).
Changes to Medicare Part B for 2021
Plan B saw more variables than Plan A, but overall, costs remained relatively the same:
Plan B Deductible – The standard deductible for Plan B is increasing $5 in 2021 to $203. After your deductible is met, you’ll typically pay 20% of the Medicare-approved amount for most doctor services.
Plan B Premium - Most people pay the standard Part B premium amount, but if you make more (as reported on your tax returns from 2 years prior to your benefits), you’ll pay the standard premium and an Income Related Monthly Adjustment Amount (IRMAA).
Part C and Part D Medicare Changes for 2021
If you’ve opted for Part C and D Medicare coverage, changes to your premiums will vary based on the type of plan you chose. For more information, visit the links below.
Get Help Understanding Your Medicare Plan Options
The Medicare program provides a lot of choices and can be hard to understand. If you have questions about the many options provided or you need help with how these costs fit into your budget, talk to an MRPR Tax Professional. If you need help with wealth management, we can help you navigate the complexities and minimize unnecessary costs by partnering with our financial planning consultant; Avantax Planning Partners.
Investment advisory services are offered through Avantax Planning PartnersSM. Commission-based securities products are offered through Avantax Investment ServicesSM, Member FINRA, SIPC. Insurance services offered through licensed agents of Avantax Planning Partners. Avantax entities are independent of and unrelated to MRPR.
Topics: Tax Topics