Key Takeaways

• Even though Medicare Part B helps cover outpatient care, doctor visits, and preventive services, it does not pay for everything. You are still responsible for monthly premiums, annual deductibles, coinsurance, and potential penalties.

• Knowing exactly what Medicare Part B covers and what it doesn’t can help you avoid surprise medical bills and plan realistically for your out-of-pocket costs in 2025.

What You Get with Medicare Part B

Medicare Part B is a core part of Original Medicare, primarily designed to help cover medically necessary services. This includes:

• Doctor visits (both primary care and specialists)

• Outpatient care and surgeries

• Preventive services like screenings, vaccines, and wellness visits

• Durable medical equipment (DME)

• Mental health outpatient services

• Laboratory tests and diagnostic imaging (like X-rays or MRIs)

This coverage can significantly reduce your medical bills. But it doesn’t mean your health care is free.

What You Still Have to Pay in 2025

Even with Part B coverage, there are significant out-of-pocket costs that can add up quickly. Here’s a breakdown of what you’re still responsible for this year:

Monthly Premium

The standard Part B monthly premium in 2025 is $185. However, if your income is above certain thresholds, you may pay more due to an Income-Related Monthly Adjustment Amount (IRMAA).

Annual Deductible

Before Medicare Part B pays anything, you need to meet the annual deductible, which in 2025 is $257. You pay this out of pocket at the start of the year.

20% Coinsurance

After meeting your deductible, Medicare covers 80% of approved services. You are responsible for the remaining 20%. This applies to:

• Office visits

• Diagnostic tests

• Outpatient procedures

• Emergency department care (if not admitted)

• Durable medical equipment

Unlike some other types of insurance, there’s no annual out-of-pocket maximum under Original Medicare.

What Medicare Part B Doesn’t Cover

There are several key services that Medicare Part B does not cover, which may surprise many enrollees:

• Prescription drugs (except for a limited number of medications administered in a clinical setting)

• Routine dental, vision, and hearing care

• Long-term custodial care, such as nursing home stays for help with daily activities

• Over-the-counter health items

• Most chiropractic or acupuncture services (with a few exceptions for specific conditions)

If you want coverage for these types of services, you’ll need to explore other parts of Medicare, such as Part D or additional coverage.

The Risk of Unexpected Medical Bills

Because there’s no cap on how much you can pay out of pocket under Part B, your financial exposure can be significant, especially if you:

• Have frequent specialist visits

• Need extensive diagnostic testing or outpatient surgery

• Use durable medical equipment for chronic conditions

These 20% coinsurance charges can quickly turn into thousands of dollars annually, especially for services like chemotherapy or physical therapy.

Income-Based Premium Increases in 2025

Your modified adjusted gross income (MAGI) from your 2023 tax return determines whether you pay a higher premium in 2025. Here’s how it works:

• Individuals with a MAGI above $106,000

• Married couples filing jointly with a MAGI above $212,000

If your income exceeds these thresholds, IRMAA adds a surcharge to your standard premium. These higher premiums are tiered based on income levels, and they can significantly increase your monthly costs.

Late Enrollment Penalties

You’re expected to sign up for Medicare Part B during your Initial Enrollment Period (IEP), which begins three months before the month you turn 65 and ends three months after. If you miss this seven-month window and don’t qualify for a Special Enrollment Period, you may face a permanent late enrollment penalty.

The penalty is calculated as:

• 10% added to your premium for each full 12-month period you could have had Part B but didn’t enroll

• This penalty is permanent and applies for as long as you have Part B

If you delayed enrollment thinking you wouldn’t need Part B or assumed your other coverage was enough, this penalty can become an expensive oversight.

Coordination with Employer Coverage

If you’re still working at 65 and have group health coverage from an employer with 20 or more employees, you can delay Part B without penalty. But you must:

• Confirm that your employer plan is considered creditable coverage

• Enroll in Part B within eight months of losing that coverage to avoid penalties

Retiree coverage, COBRA, or VA benefits don’t count as creditable coverage for delaying Part B without penalty.

Outpatient Hospital Services: A Costly Gray Area

Medicare Part B does cover outpatient hospital services, but billing practices can lead to higher-than-expected charges. This includes:

• Observation stays (where you’re in the hospital but not officially admitted)

• Same-day procedures

• Emergency room visits

These may look like inpatient stays but are billed differently under Part B, leaving you responsible for 20% of all charges without a cap. Always ask whether you are officially admitted or under observation.

Why Many Add Extra Coverage

Because of these gaps and financial risks, many people seek additional coverage to supplement what Medicare Part B doesn’t pay. While specific plan names or costs are not discussed here, these types of coverage often include:

• Prescription drug coverage (under Part D)

• Plans that help cover coinsurance, deductibles, and out-of-pocket expenses

• Vision, dental, and hearing coverage

While these plans offer broader protection, they come with their own rules, costs, and enrollment windows. It’s important to understand how they work alongside Original Medicare.

Preventive Services Can Save You Money

While much of Part B comes with costs, many preventive services are covered with no out-of-pocket expense if certain conditions are met. These include:

• Annual wellness visits

• Screenings for cancers (like colorectal, breast, or lung)

• Vaccines for flu, pneumonia, and hepatitis B

Using these services early can help catch health problems before they become serious and expensive.

Keeping Track of Your Medicare Summary Notice (MSN)

You receive a Medicare Summary Notice every 3 months. This document lists all the services you were billed for under Part B and shows:

• What Medicare approved

• What Medicare paid

• What you may still owe

Review your MSN regularly to spot billing errors or unfamiliar charges. It’s a valuable tool for tracking your out-of-pocket spending.

Medical Necessity Still Matters

Even if a service falls under Part B, Medicare only pays if it deems the service medically necessary. That determination is based on strict guidelines. If a provider recommends a test or treatment, and Medicare decides it’s not medically necessary, you may have to pay the full cost.

To avoid this:

• Ask if the procedure is covered by Medicare

• Request an Advance Beneficiary Notice (ABN) when recommended services may not be covered

This gives you the option to decline the service or agree to pay out of pocket.

Being Prepared Can Help You Save

The more informed you are, the less likely you are to be caught off guard. To manage your costs under Medicare Part B in 2025:

• Know what services are and aren’t covered

• Understand how coinsurance and deductibles work

• Check your income bracket to see if you’re subject to IRMAA

• Use preventive services and wellness checks

• Consider additional coverage if your health needs or finances require it

Understanding Your Costs Can Prevent Financial Stress

Medicare Part B is an essential benefit, but it’s not all-inclusive. Being realistic about your share of the costs can help you avoid financial strain and make better decisions about additional coverage.

For help reviewing your options and understanding how Medicare Part B fits into your overall plan, get in touch with a licensed agent listed on this website.