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Ask Rusty – Can I Avoid Paying the Medicare Premium?
Dear Rusty: Is there any way I can get out of paying the $185 I am told will be taken out of my Social Security for Medicare Part B when I turn 65? We pay for Medicare all our working lives, and now I have to pay a monthly premium for insurance that only covers 80%. Signed: Disheartened Senior
Dear Disheartened: For clarification, the money you paid into Medicare while working during your lifetime was for Medicare Part A (inpatient hospitalization coverage). The Medicare taxes paid while working entitled you to FREE Medicare coverage for Part A inpatient hospitalization coverage, but they do not entitle you to Medicare coverage for outpatient services (coverage for doctors, medical tests, etc.). For that coverage from Medicare, you must enroll in Medicare Part B, for which there is a monthly premium ($185/month for 2025). If you wish to have Medicare Part B coverage, you must enroll in Medicare Part B at age 65 – unless you have other “creditable” healthcare coverage from an employer.
The Medicare Part B premium will be automatically deducted from your Social Security payment when you enroll in Medicare, and there is no way to avoid it if you wish to have Medicare healthcare coverage for outpatient medical services. But, if you currently have “creditable” healthcare coverage from an employer, you can delay enrolling in Medicare Part B (thus avoiding the premium) until your employer coverage ends. If you don’t enroll in Medicare Part B during your initial enrollment period (at 65), or in a Special Enrollment Period following the end of your creditable employer healthcare coverage, then you will incur a penalty for enrolling in Medicare Part B outside of the prescribed enrollment periods. That penalty is a permanent increase in your Medicare Part B premium. FYI, “creditable” is an employer group plan with at least 20 participants.
We do not advise going without outpatient healthcare coverage, so you should carefully consider enrolling in Medicare Part B when you turn 65. If you are already collecting Social Security benefits, you will be automatically enrolled, but you can opt out of Part B if you wish – it’s just not advisable, unless you have current creditable healthcare coverage from an employer.
So, to recap: the Medicare taxes you paid while working only entitled you to free Medicare Part A inpatient hospitalization coverage. You must enroll in Medicare Part B (for which there is a monthly premium) to have Medicare healthcare coverage for outpatient healthcare services. Both Medicare Part A and Part B have deductibles and copayments, for which you may wish to consider getting either a supplemental insurance plan or a Medicare Advantage plan. But, in either case, you must still have both Medicare Part A and Part B to obtain such additional healthcare coverage.