Medicare & Social Security Deductions

When it comes to Social Security, both employers and employees each contribute 6.2%, adding up to a total of 12.4%. Similarly, for Medicare, the tax rate is 1.45% for both parties, making it a total of 2.9%. In 2023, most individuals enrolled in Medicare and receiving Social Security benefits will have $174.70 deducted from their Social Security check each month. 

This amount covers the monthly premium specifically assigned to Medicare Part B. However, it’s important to note that some individuals may have higher deductions from their Social Security benefits to cover other Medicare premiums.

You won’t receive a monthly bill for Medicare premiums from Social Security, but you will receive a monthly statement telling you how much will be deducted from your Social Security check.

You may also be able to have Medicare Advantage (Medicare Part C) and Medicare Part D prescription drug plan premiums deducted from your Social Security benefits.

While Medicare premiums can be deducted automatically, the amount withheld from your Social Security check each month depends on what Medicare plans you are enrolled in, whether you have to pay Medicare Part A premiums and your annual income.

Most people don’t have to pay Medicare Part A premiums. However, you have to pay Part A premiums if you have not paid Medicare taxes through your job for at least 10 years.

If you have to pay monthly Medicare Part A premiums, you can’t qualify for Social Security benefits. But you can still buy Medicare Part A if you don’t qualify for Social Security.

If you have Medicare Part B medical insurance, your premiums are automatically deducted from your Social Security check and your monthly premiums are based on your income. Most Part B enrollees will have $174.70 deducted from their Social Security each month in 2024.

The amount increases if you have a high income. The amount of the premium, and the income level at which it increases, change each year.

Medicare Advantage plans are sold through private insurers and replace Medicare Part A and Part B. In some cases, their premiums can also be deducted from your monthly Social Security benefits.

This won’t be automatic. If you have a Medicare Advantage plan you will have to contact your plan’s administrator to set it up. Some plans may not let you have the premiums deducted from your Social Security benefits.

The amount of the deduction varies from plan to plan — and there were roughly 4,000 plans available in the United States for 2023, according to the Kaiser Family Foundation.

Medicare Part D prescription drug plans are sold through private insurers and premiums vary from plan to plan. Most Medicare Advantage plans include a Part D plan as well.

If you have a standalone Medicare Part D plan, you can contact the plan administrator to set up automatic deductions from your monthly Social Security check. Not all plans will allow you to set up automatic deductions.

You typically cannot have your Medigap premiums deducted from your Social Security check.

Medigap — also called Medicare Supplement insurance — helps cover out-of-pocket Medicare costs such as copays, coinsurance and Medicare deductibles. These policies are sold through private insurers who bill you directly.

Medicare helps with your health care costs — but does not cover all medical expenses and does not cover long-term care. Most people still have to pay for Medicare if they are on Social Security.

One notable exception is that if you qualify for Social Security benefits you do not have to pay premiums for Medicare Part A when you turn 65. But you will still be responsible for deductibles and coinsurance or copays.

You will have to pay premiums and other out-of-pocket expenses for other parts of Medicare. Everyone who has Medicare Part B or a Medicare Advantage plan is responsible for their Medicare Part B premiums.

Medigap plans C and F cover the Part B annual deductibles, but only to those who became eligible before Jan. 1, 2020. However, these plans only cover the deductible, not the Part B premium.

Some Medicare Advantage plans may offer “give back benefits” to beneficiaries that “give back” some or all of the cost of the monthly Part B premium. These plans are not available in all areas.