Chapter 3

Understanding What You Pay Toward Your Costs in Medicare

In This Chapter

arrow Getting the scoop on Medicare premiums, deductibles, and co-payments

arrow Shelling out higher premiums if your income is over a certain level

arrow Continuing to pay Medicare taxes when you’re already receiving Medicare benefits

What will Medicare cost you, and how much will it save you? That’s the killer question for people just coming into the program. In a way, the answer really depends on where you started out. Did you have low-cost insurance from an employer when you were working? Then Medicare may seem expensive in comparison. Were you paying through the nose for an individual policy that didn’t actually provide much coverage? Or perhaps because of age and poor health, you couldn’t buy insurance at any price? In those cases, Medicare probably seems like the promised land.

This point bears repeating: Medicare isn’t free. Some people do think that the Medicare payroll taxes they pay while working will net them totally free health care after they hit 65. Sorry, not so. In fact, on average, Medicare is said to cover only about half of beneficiaries’ total health care costs if they have no extra insurance. ...

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