I’m about to sign up for Medicare. What are the logistics of paying the premiums? Will I get a bill each month?
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You generally don’t have to pay a premium for Medicare Part A, but you will have monthly premiums if you sign up for Medicare Part B. Most people pay $104.90 per month for Part B in 2015. If your adjusted gross income is more than $85,000 (for singles) or $170,000 (if you’re married filing jointly), you’ll pay from $146.90 to $335.70 per person each month. See Medicare.gov’s Part B Costs for details.
If you’re receiving Social Security benefits, then your premiums will be deducted from your monthly benefits. If you haven’t signed up for Social Security yet, you’ll get a monthly bill for your premiums. See the Understanding the Notice of Medicare Premium Payment Due Form (Form CMS-500) for more information.
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With Medicare Part D prescription-drug coverage, you’ll generally pay premiums directly to the private insurer, although you can ask your drug plan to have your premium deducted from your monthly Social Security payment. If your adjusted gross income is greater than $85,000 (for singles) or $170,000 (if married filing jointly), you’ll also have to pay a high-income surcharge for your Part D coverage, which adds from $12.30 to $70.80 per month, depending on your income. You pay that extra money to Medicare, rather than to the insurer, and it will also appear on the Notice of Medicare Premium Payment Due. See Medicare.gov’s Monthly Premium for Drug Plans for details.
As with any other bills, you can pay Medicare premiums by check or credit card or through your bank’s online bill-payment service. Or you can sign up for Medicare Easy Pay, which automatically deducts your premium payments from your savings or checking account every month. See Medicare Easy Pay for more information.
If you contributed to a health savings account before you signed up for Medicare, you can withdraw money from the HSA tax-free to pay your Medicare premiums, and you can even reimburse yourself for the premiums if they are automatically deducted from your Social Security payments. You can also pay your spouse’s Medicare premiums with the HSA money, as long as you are 65 or older. See Paying Health Insurance Premiums From a Health Savings Account for details.