Key Takeaways

• Medicare Part B covers essential medical services, but it still involves multiple layers of out-of-pocket costs that can be surprising if you’re not aware of them in advance.

• You may be responsible for monthly premiums, annual deductibles, 20% coinsurance, and excess charges, all of which can add up quickly without supplemental coverage.

The Essentials of Medicare Part B

Medicare Part B provides coverage for outpatient medical services. This includes doctor visits, preventive services, diagnostic tests, durable medical equipment, outpatient surgeries, and mental health care. It’s one of the core parts of Original Medicare, along with Part A, and it is not optional unless you have other creditable coverage.

Unlike Part A, which is premium-free for most beneficiaries, Part B always requires a monthly premium. In 2025, the standard monthly premium is $185. However, your income can push that amount higher. Once you are enrolled, you are also subject to other costs like the annual deductible and coinsurance.

1. The Premium Is Only the Beginning

The most visible cost is the monthly premium, but that’s just the entry point. The base premium of $185 applies only to individuals with a modified adjusted gross income (MAGI) at or below $103,000, or $206,000 for couples filing jointly.

If your income exceeds these thresholds, the Income-Related Monthly Adjustment Amount (IRMAA) will apply, and your monthly premium could be significantly higher. The Social Security Administration uses your tax return from two years ago to determine your IRMAA tier.

2. You Must Meet the Annual Deductible

Before Medicare starts paying its share, you must pay the annual Part B deductible. In 2025, this amount is $257. While that may not seem high, it must be paid out of pocket each calendar year before any coinsurance cost-sharing begins.

What catches people off guard is that this deductible resets every January 1. If you need care early in the year, you’ll be paying this upfront, and it’s not prorated based on when you enroll.

3. The 20% Coinsurance Can Be Costly

After you meet your deductible, Medicare Part B generally pays 80% of approved services. That leaves you responsible for the remaining 20%—and there is no cap on this coinsurance.

Even a single specialist visit, diagnostic test, or outpatient surgery can result in hundreds or thousands of dollars in coinsurance. There is no out-of-pocket maximum under Original Medicare unless you have supplemental insurance to help with these costs.

4. Medicare Does Not Cover Everything

Part B does not cover:

• Most dental care

• Routine vision exams and glasses

• Hearing aids and exams for fitting them

• Long-term custodial care

• Prescription drugs (you’ll need Part D for that)

These services must be paid for separately, and many people are surprised to learn they are not included in Part B coverage.

5. Beware of Excess Charges

If your provider does not accept Medicare assignment, they may legally charge up to 15% more than the Medicare-approved amount. These are called “excess charges,” and you are responsible for them out of pocket unless you have supplemental insurance that covers them.

Not all doctors accept assignment, so it’s important to verify this when scheduling care. Otherwise, your 20% coinsurance could become 35% or more for certain services.

6. You May Still Pay for Preventive Services

Medicare Part B covers many preventive services, including screenings, flu shots, and wellness visits. However, not all preventive services are entirely free.

If your doctor performs additional tests or procedures during your wellness visit that are not classified as preventive, you may receive a bill for those services. In some cases, even the facility fees or lab charges can be billed separately.

7. If You Delay Enrollment, You’ll Pay Penalties

If you don’t sign up for Part B when you’re first eligible and don’t have other creditable coverage, you will face a late enrollment penalty. This penalty adds 10% to your monthly premium for each full 12-month period you delayed.

Worse, the penalty is not temporary. It applies for as long as you have Part B. For example, if you delayed enrollment by three full years, you’d pay a 30% higher premium every month for life.

8. Timing Can Affect When Coverage Starts

Your Initial Enrollment Period (IEP) lasts for seven months: the three months before, the month of, and the three months after your 65th birthday. If you enroll during the first three months, your coverage begins the month you turn 65. But if you wait until your birthday month or the following months, coverage will be delayed.

As of 2023, Medicare no longer delays coverage by up to three months for late IEP enrollments, but delays of at least one month still apply. Timing errors can leave you without coverage when you need it most.

9. Outpatient Hospital Services Can Be a Financial Surprise

Hospital outpatient departments and ambulatory surgical centers often carry higher coinsurance costs than you might expect. You may have to pay:

• A facility fee

• 20% of the Medicare-approved service cost

• Potential excess charges if the provider doesn’t accept assignment

Unlike inpatient stays under Part A, these outpatient services don’t have a fixed copayment or deductible structure. This makes estimating your total costs more difficult.

10. Emergency Room Visits Are Not Fully Covered

If you visit an emergency room and are not admitted as an inpatient, you will likely pay under Part B. This means:

• You’ll owe the Part B deductible if you haven’t met it yet

• You’ll be responsible for 20% coinsurance on all services

• You may receive separate bills from the hospital, doctors, labs, and imaging departments

This comes as a shock to many who assume emergency care would be fully covered.

11. Durable Medical Equipment Involves Shared Costs

Medicare Part B covers durable medical equipment (DME) such as walkers, oxygen supplies, and wheelchairs. However, you must use a Medicare-approved supplier, and you’ll still pay 20% of the cost after meeting your deductible.

If you purchase DME outright or choose to rent it, the 20% coinsurance still applies. If the supplier is not enrolled in Medicare, you may be responsible for the full cost.

12. Mental Health Services Come With Coinsurance Too

Medicare covers outpatient mental health services like therapy, diagnostic testing, and psychiatric evaluations under Part B. But again, you are responsible for:

• The annual deductible

• 20% coinsurance

• Any excess charges if the provider doesn’t accept assignment

Facility fees may also apply if the services are provided in a hospital outpatient department.

13. Ambulance Services Are Only Partially Covered

Emergency ambulance transportation is covered under Part B if deemed medically necessary. But Medicare typically pays only 80% of the Medicare-approved amount, and you owe the rest.

If the ambulance provider doesn’t accept assignment or you require air ambulance services, costs can be much higher.

Why You Should Plan Beyond the Basics

Most people entering Medicare focus on the monthly premium, thinking that’s their primary cost. But Part B includes a network of shared expenses: deductibles, coinsurance, excess charges, and non-covered services. If you don’t plan for these, your out-of-pocket costs can be unexpectedly high.

To avoid financial strain, it’s worth considering:

• Supplemental insurance options

• Staying within the Medicare provider network

• Reviewing what is and isn’t covered

• Setting aside a monthly healthcare budget

Even if you’re healthy now, a single health event could trigger thousands in bills if you’re unprepared. Being aware of these cost layers helps you plan for them—not just react to them.

Prepare Now to Prevent Financial Stress Later

Medicare Part B is essential, but it’s not a blank check for unlimited care. The program has cost-sharing rules and gaps that many people don’t fully understand until they get a bill. Taking the time now to understand how these out-of-pocket costs work gives you the ability to make smarter decisions.

If you’re unsure whether your providers accept Medicare assignment, what counts as preventive, or how coinsurance might affect you, a licensed agent listed on this website can walk you through your options. Reach out today to get personalized advice before costs catch you by surprise.