As you explore what your Medicare costs may be when you are eligible to enroll you will discover that although you worked all of life and had your 2.9% deducted from your paycheck, your Medicare is not free. This is a controversial topic, and many have different opinions on what Medicare should be. We will discuss what Medicare is today.
It is important to note that everyone’s situation is different. We cannot emphasize that enough. Your situation may be different than your next-door neighbor or your best friend, Suzy Q and there are so many factors to consider that makes you unique. This includes the amount of time you worked and earned employment credits as well as your doctors, prescriptions, and financial situation. We will begin with a key eligibility factor that impacts the premiums you pay for Medicare, employment quarters, and Medicare costs.
What are employment quarters?
According to the social security administration, one employment quarter is equal to three months and there are 4 quarters in a year (Jan-Mar, April-June, July-September, October-December). The Social Security Administration (SSA) also refers to a “quarter of coverage” (QC) as a “Social Security credit.”
How Much Do You Need to Earn to Get Employment Credits?
The amount of earnings it takes to earn a credit may change each year. In 2020, you earn one Social Security or Medicare credit for every $1,410 in covered earnings each year. In a nutshell, you must earn $5,640 to get the maximum four credits for the year.
What If I do not have enough credits?
You may still qualify for Medicare based on your qualifying age or disability, but the cost of Medicare Part A premium may be affected. Generally, you will have premium free Medicare Part A but if you are short on employment credits you may have to pay a premium.
What are my other Medicare costs?
Well this depends. We know this sounds vague, but as we discussed before everyone’s situation is different. These are the potential costs for Medicare:
Part A (Hospital): You may qualify for premium free hospitalization coverage. However, there are deductible and co-pays under Part A
Part B (Medical): To enroll in Part B, you will generally have to pay a premium. For 2020, the Part B premium is $144.60. However, if your income is over $87000, you may have to pay an additional premium.
For more information and a consultation, contact RS Financial Services at 754-300-4544 or click here to schedule a consultation.