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Premiums for Medicare won't increase next year

Medicare premiums will not increase in 1998, thanks to a slower than expected rise in health care costs.

Congressional accountants predicted in the summer that rising health-care costs would mean an increase of about $20 over the next five years in the monthly Medicare premiums in order to balance the federal budget.Senior citizens pay the premiums for doctor's office visits and other outpatient treatment.

But also during the summer, Medicare officials were working on a program review that has shown senior citizens' health-care costs are not growing as much as expected.

In fact, it turns out that the $1.30 increase that boosted the Medicare premium from $42.50 a month in 1996 to the current $43.80 has been more than enough this year to cover the 25 percent of program costs seniors are expected to pay.

That means next year Medicare premiums can remain at $43.80, and not increase by $1.90 as originally planned. And savings called for in the balanced budget deal will still be met.