Due to a series of tax increases passed over time, the maximum Medicare payroll tax is now technically unlimited. Since 2013, workers earning above $250,000 per year pay 3.8% of all their earnings for this tax, and all workers who earn more than $1.32 million per year pay more than $50,000 for this tax. This tax only funds Medicare hospital insurance, and other Medicare benefits like physician services, lab tests, and prescription drugs are paid through other taxes.