Billy Bob and his wife, Betty, will apply for Medicare for the first time in 2018. The standard monthly premium for Medicare Part B for 2017 was $134.00 and will remain the same for 2018. However, most people paid less than that amount if the premium was automatically deducted from their Social Security benefits. On average, they paid $109.00. The reason for this is that the premium increased more than the cost-of-living increase for 2017 Social Security Benefits.

Persons who had Modified Adjusted Gross Income (MAGI) over a certain amount will pay a premium for Part B that is higher than the standard premium. The MAGI is figured by deducting any non-taxable income from Adjusted Gross Income (AGI) reported on the tax return two years prior to qualifying for Medicare.

Billy Bob and Betty file joint tax returns as a married couple. In 2016, their AGI was $175,000. They had no non-taxable income.

What Will Billy Bob and Betty Pay in Part B Premiums in 2018?

Since they have no non-taxable income, Billy Bob and Betty have a MAGI of $175,000. They fall within that category of earners between $170,000 and $214,000, who must pay $187.50 each for their monthly Part B premiums. This amount will be automatically deducted from their Social Security monthly benefits unless they specify otherwise.

Will Billy Bob and Betty Have to Pay a Part B Deductible?

All recipients of Medicare Part B must pay a deductible of $183.00 before benefits kick in. This amount is the same regardless of income. Some Medicare Supplement (Medigap) policies will cover that deductible. These policies must be obtained from private insurance companies and require an additional premium apart from the Part B premium. Not all Medicare Supplement plans cover this deducible.

What are the Part B Premiums for Each of the Earnings Level?

Medicare.gov lists five groups of earners and the premiums they must pay for Part B in 2018. Those individuals with MAGI of $85,000.00 or less and couples filing jointly, with MAGI of $170,000.00 or less, will pay the standard premium. Those individuals who earn above $85,000.00 up to $107,000.00 will pay $187.50. As with Billy Bob and Betty, those couples filing jointly with MAGI between $170,000.00 and $214,000.00, will pay $187.50. Those individuals with MAGI above $107,000.00 up to $133,500.00 and those couples filing jointly, whose MAGI is above $214,000.00 up to $267,000.00, will pay $267.90. Those individuals with MAGI above $133,000.00 up to $160,000 and those couples filing jointly, whose MAGI is above $267,000.00 up to $320,000.00, will pay $348.30. Those individuals with MAGI above $160,000.00 and those married couples filing jointly, whose MAGI is above $320,000.00 will pay $428.60.

            All individuals who are signed up for Medicare, Part B, can review the rules for determining premiums for 2018 on this website: https://www.medicare.gov/your-medicare-costs/part-b-costs/part-b-costs.html.

            Sandra W. Reed is an attorney with Katten & Benson, an Elder Law firm in Fort Worth.  She lives in beautiful Somervell County, near Chalk Mountain.