Key Takeaways
- Nearly 1 in 4 Americans say Medicare is free for everyone, according to Allianz Life’s 2026 Annual Retirement Study.
- Medicare Part B’s standard premium is $202.90 a month in 2026. That’s $2,434.80 a year per person, and there’s also a $283 deductible.
- After the deductible, Original Medicare leaves you 20% of each approved Part B bill with no yearly limit, unless you add a Medigap policy or join a Medicare Advantage plan.
- Higher earners pay a surcharge on top, and a single filer with $500,000 or more of 2024 income pays $8,278.80 a year for Part B alone.
Nearly 1 in 4 Americans say Medicare is free for everyone, according to Allianz Life’s 2026 Annual Retirement Study. If you’re one of them, I have some bad news, and it’s a lot better to hear it now than from your first bill.
Part B is the part of Medicare that pays for doctor visits and outpatient care. It comes with a monthly premium, a yearly deductible and a share of almost every bill after that. And unless you’ve added coverage on top of it, there’s no ceiling on that last piece.
You pay $2,717.80 before Part B pays a dime
Let’s say you’re 65, you’ve signed up for Original Medicare, and you have no Medigap, employer or retiree coverage on top. Your Part B premium is $202.90 a month in 2026. It’s charged per person, so a married couple pays it twice. Over a year, that’s $2,434.80 each, or $4,869.60 for the two of you.
Then there’s the $283 deductible, which you pay before Part B covers anything at all. So before Medicare picks up a single doctor’s bill, you’re out $2,717.80 between premiums and the deductible.
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Then comes the 20%, with no cap
Once you’ve paid the deductible, you usually owe 20% of the Medicare-approved amount for each covered service or item. And Medicare Part B has no yearly limit on what you pay out of pocket unless you have supplemental coverage or join a Medicare Advantage plan.
On a $100 doctor’s bill, that’s $20, which is easy to shrug off. Marcia Mantell, founder of Mantell Retirement Consulting, gave the other extreme while walking through Part B’s costs on the Oct. 30 episode of Jill on Money with Jill Schlesinger: “If it’s a $200,000 chemo treatment you pay 20% of that also.” That’s $40,000 out of your pocket for one treatment. And since Part B has no max out of pocket, there’s nothing stopping another treatment from costing the same again.
Earn more, and Part B costs more
The $202.90 is the standard premium, and higher earners pay a surcharge on top of it, known as IRMAA. Medicare sets it from your modified adjusted gross income on the tax return from two years before, so your 2026 surcharge comes from your 2024 return. It starts above $109,000 of income for a single filer, or $218,000 on a joint return, at $81.20 a month, or $974.40 a year. Here’s what Part B alone costs each person in 2026 at each level:
| 2024 income, single | 2024 income, joint | Surcharge a month | Part B a month | Part B a year |
|---|---|---|---|---|
| $109,000 or less | $218,000 or less | $0 | $202.90 | $2,434.80 |
| Above $109,000 to $137,000 | Above $218,000 to $274,000 | $81.20 | $284.10 | $3,409.20 |
| Above $137,000 to $171,000 | Above $274,000 to $342,000 | $202.90 | $405.80 | $4,869.60 |
| Above $171,000 to $205,000 | Above $342,000 to $410,000 | $324.60 | $527.50 | $6,330.00 |
| Above $205,000, under $500,000 | Above $410,000, under $750,000 | $446.30 | $649.20 | $7,790.40 |
| $500,000 or more | $750,000 or more | $487.00 | $689.90 | $8,278.80 |
At the top, that’s more than three times the standard premium, and you still owe the deductible and every 20% share on top of it. Because Medicare looks back two years, a one-time jump in income, like a big Roth conversion in 2024, can raise your 2026 premium even if your income has fallen since.
You can put a ceiling on the 20%
You can’t do much about the premium, but fortunately you can do something about the 20%. One option is a Medigap policy, which helps pay the costs Original Medicare doesn’t cover, like that 20% coinsurance. The other is a Medicare Advantage plan, which has its own yearly out-of-pocket limit that varies by plan. Medicare’s open enrollment period runs through Dec. 7, and you can use it to change how you get your coverage for next year, including a move to Medicare Advantage.
Frankly, I’d treat the premium as a bill to budget for and the 20% as a risk to insure against. A $2,434.80 premium is a known cost you can plan around. A 20% share of a hospital-sized bill, with nothing to stop it, can knock a retirement plan way off course.
CMS is due to publish 2027’s Part B premium, deductible and surcharge brackets later this month (last year, it put out this year’s on Nov. 14), so fingers crossed that any increase is modest.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
