Social Security and Medicare are two of the biggest American social safety net programs. Both programs are separate, but as AARP notes, Social Security actually handles enrollment for Medicare Part A and Part B.
Sifting through both can be confusing, but the distinctions are worth noting to understand your total benefit and cost potential.
How Your Medicare Premiums are Deducted from Social Security Benefits
Perhaps the biggest piece of this is that Medicare Part B Premiums are directly deducted from your Social Security benefits (if you’re receiving them). If you’re not getting benefits, you’ll get a bill directly from CMS.
In 2020, Part B premiums start at $144.60 per month and rise with your income level. AARP notes that premiums are based on your modified adjusted gross income (MAGI), which are taken from the most recent tax data Social Security has on file. If your income was less than $87,000 as an individual, you’ll pay the standard $144.60 rate ($174,000 for joint filers). Premiums top out at $491.60 per month if your MAGI exceeds $500,000 for individual and $750,000 for joint filers, respectively.
Parts C and D can also be deducted from your premium, at your specific request.
Things to Keep in Mind
If you’re disabled, you may qualify for Medicare before the automatic enrollment at age 65. If you’re receiving SSDI, Social Security will automatically enroll you in Parts A and B if you have been drawing benefits for two years.
If you’re considering Health Insurance Marketplace coverage, you can’t enroll in a Marketplace plan to replace or supplement existing coverage unless you enrolled in a plan before enrolling in Medicare. In this case, you’re allowed to keep the plan as supplemental coverage. However, you’ll lose any credits or savings on your Marketplace plan by electing to go this route.
Figuring out how to work within the rules of Medicare and Social Security can be overwhelming and difficult. This is why it’s important to consult a qualified Social Security benefits attorney to determine your best options. Call (541) 434-6466 today to arrange a free initial consultation with Drew Johnson, P.C. and his dedicated Social Security disability benefits team.