What is the Social Security giveback?

When you enroll in a Medicare Advantage plan, you will be required to pay the premium for the Advantage plan and Part B plan. However, some plans may offer a giveback rebate, also known as a premium reduction benefit, which can help reduce part of or all of your premiums.

A Social Security giveback benefit reduces the amount you pay each month for your Medicare Part B premium. It can cover anywhere from 10 cents to the full price of your Part B premium i.e. $164.90 for 2023. The giveback benefit is applied directly to your Social Security check, and you won’t receive a separate check for the giveback benefit.

How does a giveback benefit work?

The Medicare giveback benefit is a premium reduction program offered by some Medicare Advantage (Part C) Plans. When you enroll in a Medicare Advantage plan that offers this benefit, the plan will pay some or all of the Part B monthly premium. The total premium reduction can range from 10 cents to the full premium reduction i.e. $164.90 in 2023.

Since the payment for Part B premium is mostly deducted from your monthly Social Security benefits check, the premium reduction results in more money in your monthly check. The giveback benefit is only available to individuals who pay the Medicare premiums themselves. If your Medicare premiums are paid by Medicaid or other government programs, you won’t be eligible for the giveback benefit.

Availability of the Social Security giveback

The giveback benefit is not available nationwide, and it is restricted to specific states and counties. Currently, insurance companies in 48 states provide Medicare Advantage giveback benefits, but it is not available to all residents in all ZIP codes. If you live in an area where the giveback benefit is offered by at least one Advantage plan, it is likely that other Advantage plans available in your area may not offer this benefit.

Use the Medicare Plan Finder tool to check the Medicare plans with giveback benefits available in your area. From the plan listing, select a plan and click “plan details”, then go to the “Part B premium reduction” to know if the specific plan provides a giveback benefit. Compare the plans with a giveback benefit to know which plan offers the highest benefit.

However, the giveback benefit should not be the only benefit you consider; check if the plan provides prescription drugs coverage, doctors covered, out-of-pocket costs like copayments and deductibles, etc.

How much do you get back with Part B giveback plan?

If you enroll in a Medicare Advantage plan with a giveback benefit, the premium reduction can be as low as 10 cents to as much as the full Part B premium, i.e. $164.90 per month in 2023. This premium reduction must be offered uniformly to all plan enrollees so that everyone gets an equal premium reduction.

If your giveback benefit is $50, you will pay $114.90 ($164.90-$50). You won’t get the reduction as a payment, but it will reflect in your Social Security statement. The $50 won’t be deducted from your monthly Social Security check, but you will receive a higher Social Security benefit amount to reflect the premium reduction.

If your premium reduction is equal to the full premium amount, you won't incur any fee other than copayments and deductibles that are included in your Advantage plan. You can also enroll in Medicare Advantage plans with $0 monthly premiums- you will only pay the Part B premium.

Where can you get the Medicare giveback benefit?

If are looking for Advantage plans with the giveback benefit, you must live in a Zip Code where this benefit is available. Here are options you can use to find Medicare Advantage plans with giveback benefits:

Call your insurance company

If your insurance company offers Medicare Advantage plans, you can ask them if they offer giveback rebates. The insurance company will review the plans available in your Zip Code and recommend a plan with giveback rebates. However, the insurance company will only offer plans in their portfolio, and won’t recommend options from their competitors.

Contact an independent insurance agent

An independent insurance agent has access to Medicare Advantage plans from different companies, and they can compare and recommend plans with giveback rebates in your area. If there are multiple plans with the giveback rebate in your area, the insurance agent can help you narrow down to the plan with the highest benefits. Most of the time, the insurance agents are paid by the carriers, and you may not need to pay for the information you get.

Should you buy a Medicare Advantage Plan with a giveback benefit?

Enrolling in a plan with a giveback benefit can provide an immediate premium reduction, but it may also have certain drawbacks. Generally, giveback benefits mean that insurers make less money on such plans, and they can offset the premium reduction by reducing coverage for certain items.

Apart from the giveback benefit, consider the following benefits:

The coverage amounts included in the plan such as vision, dental, and prescription drugs.

The number of in-network providers in your area

Any deductibles and co-payments that you be required to pay

These benefits often come with high out-of-pocket expenses, so purchasing a plan that doesn’t cover these benefits won’t be worth it, even with the giveback benefit. Also, if the out-of-pocket costs are higher than the giveback benefit, purchasing the plan may not be worth it. Therefore, you should compare Medicare Advantage plans to see which plans make sense for your situation.

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