A Medicare bill can be paid several ways. However, Medicare premiums may also be deducted automatically, or people may not get a bill for certain types of coverage.

Medicare is the federal government healthcare insurance program. According to the Kaiser Family Foundation (KFF), Medicare provided coverage for 67.7 million United States citizens in 2020.

This article describes each Medicare part and costs. It also looks at different ways to pay premiums and other costs and examines ways to reduce costs.

We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:

  • Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.
  • Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.
  • Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
Share on Pinterest
Image credit: 10’000 Hours / Getty Images.

Medicare is a federal program that provides healthcare coverage for people in the U.S.

  • Part A is hospital insurance.
  • Part B provides medical insurance.
  • Part C, also known as Medicare Advantage, provides alternative coverage to original Medicare (Part A and Part B).
  • Part D covers prescription drugs.

Who can get Medicare?

In general, a person qualifies for Medicare Part A when they have aged 65 years. There is a 7-month enrollment period, which includes the 3 months before a person is 65, their birthday month, and the following 3 months.

If a person gets Social Security Administration (SSA) or Railroad Retirement Board (RRB) retirement benefits, they will be automatically enrolled in Medicare Part A.

Some younger individuals may qualify for coverage if they meet specific conditions, including:

  • If a person has disabilities and has Social Security disability insurance (SSDI) for 24 months or more, they are enrolled automatically.
  • If a person has end stage renal disease, and is getting dialysis or a kidney transplant, they can enroll In Medicare.
  • If a person has amyotrophic lateral sclerosis and SSDI, Medicare does not impose a waiting period, and coverage starts automatically in the first month of SSDI benefits.
  • A person who is younger than 65 may qualify for enrollment in Medicare based on their spouse or former spouse’s work history or Social Security benefits.

A person can check the Medicare eligibility and premium calculator to find out if they qualify for Medicare.

A person in employment generally pays Medicare taxes as their employer automatically deducts an amount from payroll under the Federal Insurance Contributions Act (FICA).

Premium-free part A

If an employed person, or their spouse, paid Medicare taxes for at least 40 quarters they do not pay the premium for Part A.

A person may also qualify for premium-free Medicare Part A if any of the following conditions apply:

  • a person gets SSA or RRB benefits
  • a person is aged 65 years old and is a government employee in a Medicare-covered position
  • a person is under 65 years of age but has a disability, or end stage renal disease, or amyotrophic lateral sclerosis


If a person does not qualify for premium-free Part A, they can choose to pay for the coverage.

The cost for Part A premiums ranges from $252 if a person paid Medicare tax for 30–39 calendar quarters to $458 if they paid Medicare tax for less than 30 quarters.

Part B premium costs do not depend on an individual’s work history.

In 2020, the basic Part B monthly premium is $144.60 per month. However, a small percentage of Medicare beneficiaries pay a different amount for their Part B premium. Depending on a persons’ reported annual income, or joint income if they are married, they pay a higher premium for Part B.

The chart below shows the range of incomes and associated premiums. The calculations are based on a person’s previous two years of income. So, premium cost for 2020 is based on the 2018 tax return.

Income in 2018Income in 2018Income in 2018Monthly premium in 2020
Individual tax returnJoint tax returnMarried and separate tax return
$87,000 or under$174,000 or less$87,000 or under$144.60
$87,000 up to $109,000$174,00– $218,000Not applicable$202.40
$109,000 up to $136,000$218,00– $272,000Not applicable$289.20
$136,000 up to $163,000$272,00– $326,000Not applicable$376.00
$163,000 and less than $500,000$326,00– $750,000$87,000– $413,000$462.70
$500,000 or above$500,000 +$413,000 +$491.60

Part C is also known as Medicare Advantage. Plans are offered by private insurance companies and costs vary among plans and providers. According to the KFF, the average monthly premium in 2019 was $29.

A person generally pays for both a Medicare Part B premium and the monthly premium for their Advantage plan.

In addition to the premium, Part C plans have associated out-of-pocket costs the plan holder must pay before the provider starts covering healthcare services. However, there is a yearly cap on these costs, unlike with original Medicare.

A person can use this online tool to check plans in their area.

Part D provides prescription drug coverage. Most Part D plans have out-of-pocket costs, including copays or coinsurance, deductible, and a premium.

Premiums vary by plan and location. However, according to KFF, the average monthly premium for Part D in 2020 is $32.74.

Some Part D plans have a zero deductible, and Medicare has ruled that the Part D maximum deductible in 2020 is $435.

Medicare does not send bills to most people, as payments are deducted automatically.

However, if a person gets a bill, known as form CMS-500, it generally arrives on the 10th day of the month. It may be sent either every month or once every three months, and Medicare will ask for payment by the 25th of the month in which the bill is sent.

If a person is late in paying the bill, or pays only a partial amount, they may risk losing their Medicare coverage. Medicare sends a second bill if the first bill is not paid.

If the bill is not paid at all, a person may lose their coverage from whichever date is shown on the final Medicare bill. In that case, a person cannot reapply until the January 1–March 31 general enrollment period.

A person can pay their Medical premiums in several ways:

  • Medicare Easy Pay is a free payment service that automatically deducts payments from a checking or saving account each month. People must have a secure MyMedicare.gov account to sign up.
  • A person can arrange for automatic payments through their bank.
  • A person can also use their debit or credit card to pay online each month through their secure MyMedicare.gov account.
  • The tear-off portion of a person’s Medicare bill can be completed and mailed with their card information to Medicare.
  • A person can send checks and money orders to the address on the Medicare bill.

People who receive SSI or RRB benefits have Medicare premiums deducted automatically from these benefits.

The government offers programs to help a person with a low income to meet Medicare costs. The programs include:

In addition, if a person has paid increased premiums due to their income level being above certain criteria, and their income level goes down, they can contact Medicare to ask for a premium adjustment.

Medicare does not send a bill to most beneficiaries. If someone gets a bill, they have several payment options. People can pay online, automatically through their bank, with a credit or debit card, or through Medicare Easy Pay.

If people prefer, they can use the mail to send credit or debit card payments, checks, or money orders directly to Medicare.

Medicare sends bills around the 10th of the month for payment by the 25th, either monthly or quarterly. Paying late may cause coverage loss.