Medicare Supplement Calculator
Estimate your total annual Medicare healthcare costs by combining Part B, Part D, and Medigap premiums with projected out-of-pocket medical expenses adjusted for your health status.
About this calculator
Medicare alone does not cover all healthcare costs. Most retirees pay a monthly Part B premium (covering outpatient care), a Part D premium (prescription drugs), and optionally a Medigap (Medicare Supplement) premium that fills gaps like deductibles and coinsurance. Total annual premium cost = (Part B + Part D + Medigap) × 12. Out-of-pocket costs are estimated based on health status: poor health multiplies expected costs by 1.0, fair by 0.6, good by 0.3, and excellent by 0.2, reflecting that healthier retirees tend to use fewer services. The full formula is: Annual Cost = ((PartB + PartD + Medigap) × 12) + (expectedMedicalCosts × healthMultiplier). This gives a realistic annual healthcare budget figure for retirement planning purposes.
How to use
Suppose you pay $174.70/month for Part B, $35/month for Part D, and $150/month for a Medigap Plan G policy, with $5,000 in expected annual medical costs and good health. Step 1 — Annual premiums: ($174.70 + $35 + $150) × 12 = $359.70 × 12 = $4,316.40. Step 2 — Adjusted out-of-pocket: $5,000 × 0.3 (good health) = $1,500. Step 3 — Total annual cost: $4,316.40 + $1,500 = $5,816.40. Budget approximately $485/month for total Medicare-related healthcare costs.
Frequently asked questions
What is the difference between Medicare Supplement plans and Medicare Advantage?
Medicare Supplement (Medigap) plans work alongside Original Medicare (Parts A and B), filling in gaps like deductibles, coinsurance, and copayments, giving you broad provider access nationwide. Medicare Advantage (Part C) replaces Original Medicare with a private plan that often bundles drug coverage and may have lower premiums, but typically restricts you to a provider network and requires referrals for specialists. Medigap offers more predictable out-of-pocket costs, while Medicare Advantage may suit healthier retirees who want lower premiums and are comfortable with network restrictions. The best choice depends on your health needs, preferred doctors, and budget.
How much does Medicare Part B cost in 2024 and what affects the premium?
The standard Medicare Part B premium in 2024 is $174.70 per month, but higher-income beneficiaries pay more through the Income-Related Monthly Adjustment Amount (IRMAA). If your modified adjusted gross income (MAGI) from two years prior exceeded $103,000 (single) or $206,000 (joint), your premium can range up to $594/month. You can appeal an IRMAA surcharge if your income has dropped due to retirement, marriage, divorce, or other life events. Planning Roth conversions carefully can help keep MAGI below these thresholds.
When should I enroll in Medicare to avoid late enrollment penalties?
You should enroll in Medicare Part B during your Initial Enrollment Period, which spans the 3 months before, the month of, and the 3 months after your 65th birthday. Missing this window without qualifying coverage (like active employer group health insurance) results in a permanent 10% penalty on your Part B premium for each 12-month period you delayed. Part D has a similar late enrollment penalty. If you are covered by an employer plan past 65, you can delay Medicare without penalty, but you must enroll within 8 months of losing that coverage.