What Is the Average Cost of Medicare Part B in 2020?

Medicare Part B is optional for all beneficiaries. Part B is medical insurance and covers certain outpatient care such as doctor’s office visits, preventive care, medical equipment and other qualified services.

In 2020, the standard Part B premium is $144.60 per month, but not everyone pays the same Part B costs.

In this guide, we break down the costs of Medicare Part B in 2020 so that you can understand more about this type of Medicare coverage.

What does Medicare Part B cover?

Medicare Part B provides coverage for doctor visits and a variety of other medical services, along with durable medical equipment (DME).

Part B coverage extends to preventive services such as:

• Screenings
• Vaccines
• Ambulance services

Learn more about the types of services, supplies and care that are covered by Part B.

What does Part B cost in 2020?

Medicare Part B services can include several different types of expenses, including, but not limited to:

• Premium
  The Part B premium is the amount that you pay each month to maintain Part B coverage.
  
  As mentioned above, the standard Part B premium is $144.60 per month in 2020.
  
  
• Deductible
  The Part B deductible is the amount that you must pay out of your own pocket during a calendar year before Part B coverage begins.
  
  In 2020, the Part B deductible is $198 per year.
  
  
• Coinsurance or copayment
  The Part B coinsurance or copayment is the portion of your medical costs for covered services that you must pay after you reach your deductible.
  
  Once you meet your Part B deductible, you are typically responsible for paying 20 percent of the Medicare-approved amount for your services or devices.

Learn more about each of these types of Part B costs in 2020 below.

2020 Medicare Part B premiums

Some Medicare beneficiaries might pay more or less than the standard Part B premium in 2020 due to a few factors.

• The hold harmless provision
  The hold harmless provision limits the Part B premium for certain beneficiaries. It means that any increase in the Part B premium in one year can be no greater than the increase in a beneficiary’s Social Security benefits from the year prior.

• Income-Related Monthly Adjustment Amount (IRMAA)
  The Income-Related Monthly Adjustment Amount (IRMAA) is the adjusted amount that higher income earners must pay for their Part B premium.
  
  The adjustment is based on your reported income from two years prior, and beneficiaries with higher incomes must pay more for their coverage. 

The chart below outlines the 2020 Part B premiums for beneficiaries affected by IRMAA based on their 2018 income.

2020 Medicare Part B deductible

Part B beneficiaries must pay the first $198 of covered Part B services out of their own pocket before their Part B coverage kicks in in 2020. This is considered the Part B deductible.

The Part B deductible is annual, meaning it resets with each calendar year.

Example: The first time you receive services or items that are covered by Part B during the year, you are billed for $300. You must pay the first $198 of that bill out of your own pocket. Your Part B coverage is then applied to the remaining $102 of the bill.

You have now met your deductible for the year. You will not have to pay anything more towards your Part B deductible until the following year when the deductible resets.

2020 Medicare coinsurance or copayment requirements

Your Medicare Part B coinsurance or copayment is the amount that you have to pay for covered services after meeting your annual deductible. The standard Part B coinsurance for most services and items is 20 percent of the Medicare-approved amount.

Using the example from above, you would likely be required to pay 20 percent of the $102 that was left over after you met your Part B deductible. This 20 percent would equal around $20.

In this example, your total spending for your $300 bill would be $218 (the $198 deductible plus the $20 coinsurance payment).

Additional Medicare Part B costs

The premium, deductible and coinsurance are the three main expenses associated with Medicare Part B.

But there are two additional costs that Part B beneficiaries might face.

• Excess charges
  When you visit a health care provider who accepts Medicare assignment, that means they accept Medicare reimbursement as full payment for the services they provide that are covered by Medicare.
  
  But if you visit a provider who does not accept Medicare assignment, that means they still treat Medicare patients but they do not accept Medicare’s reimbursement as full payment.
  
  These providers are allowed to charge you up to 15 percent more than the Medicare-approved amount for your care. This extra amount is called an “excess charge,” and you are responsible for paying for Part B excess charges in full.
  
  The Medicare-approved amount is a pre-determined amount of money that is paid to health care providers for each service or item rendered.

• Late enrollment penalty
  If you do not sign up for Medicare Part B during your Medicare Initial Enrollment Period (IEP), you could be subject to a late enrollment penalty if you decide to sign up later on.
  
  The Part B late enrollment penalty raises your Part B premium by up to 10 percent for each year that you were eligible for the coverage but did not sign up.
  
  The penalty remains in force for as long as you continue to be enrolled in Part B.

Read additional medicare costs guides to learn more about Medicare costs and how they will affect you.

Find $0 premium Medicare Advantage plans

You may be able to find a $0 premium Medicare Advantage plan in your area.

Medicare Advantage (Medicare Part C) offers the same benefits covered by Original Medicare (Part A and Part B), and some Medicare Advantage plans also cover prescription drugs and other benefits such as routine dental care.

Or call 1-800-557-6059 1-800-557-6059 TTY Users: 711 24/7 to speak with a licensed insurance agent.