How Much Do They Take Out for my Medicare in 2013?
Payroll Deductions and Other Costs
A lot of people wonder about the cost of Medicare—not only to current Medicare recipients but also to members of the workforce who are paying into the system. Following are answers to a couple of important questions we hear from time to time about Medicare-related costs the average person can expect to pay.
How much do they take out for my Medicare?
As you may know, Medicare is funded largely by:
- Payroll taxes paid by most employers and employees
- Income taxes paid on Social Security benefits
- Premiums paid by Medicare beneficiaries
- Interest earned on Medicare trust fund investment
As far as payroll deductions are concerned, the Medicare tax rate is currently set at 1.45% of income. Under provisions of the Affordable Health Care Act of 2010, an additional withholding tax of 0.9% is to be levied on income exceeding the wage threshold amount of $200,000 ($250,000 for joint filers) for tax year 2013. This means that the total Medicare tax rate on all income exceeding the wage threshold amount will be 2.35% in tax year 2013.
Currently employers match the basic employee contribution of 1.45%. In 2013 employers will continue to contribute 1.45% of employees’ income to the Medicare fund even in situations where employees’ incomes require them to contribute the higher 2.35% rate.
What Medicare Coverage Costs Can I Expect?
What you pay depends on your insurance choices and your income.
As far as Original Medicare (Medicare Part A and Part B) is concerned, chances are you’ll pay a little more than $100 a month. Most Medicare recipients get Part A at no cost, but in 2013 the majority of people enrolled in Medicare will pay a monthly Part B premium of $104.90. This amount will apply to individuals earning $85,000 or less per year and married couples earning $170,000 or less.
If Original Medicare is all the coverage you have, you’ll also have to pay a sizable share of the costs of medical services you receive. In 2013 your deductible for hospital stays will be $1,184, while you’ll have a $147 deductible plus a 20% coinsurance for your doctor bills and outpatient coverage. These figures will be current through 2013, but you should be aware that your Part A and Part B deductibles are subject to change annually.
While Medigap plans and most Medicare Advantage plans require you to pay monthly premiums, they can pay off big-time in the long run by giving you a degree of coverage that Original Medicare can’t approach. How much does a good Medicare supplement or Medicare Advantage plan cost? Not as much as you might think—because MedicareMall will leave no stone unturned in shopping the market on your behalf.
Contact MedicareMall now and we’ll make it our priority to find the coverage you need at a price you can afford.