The government said it’s lowering the monthly cost for Medicare’s outpatient coverage by 3% next year — an unusual direction that’s going to save older adults about 3% on Part B insurance and the first decrease in a decade.
President Joe Biden made the announcement Tuesday at the White House.
Part B covers outpatient hospital services and doctor visits. The Centers for Medicare & Medicaid Services said the standard monthly premium will be $164.90 in 2023; this year the premium was $170.10. Premiums are adjusted based on income, so that’s the most common price.
The annual deductible will be $7 less, at $226 in 2023.
Other deductibles, though, are going up. And that’s far less heralded.
Medicare Part A’s deductible has been set at $1,600 in 2023, which is a $44 increase. Part A covers hospitalization and the deductible, which applies to the first 60 days, is per hospitalization. Those who are in the hospital for 61-90 days will be charged coinsurance up to $400 a day, an $11 increase.
According to Medicare.gov, “There’s no yearly limit on what you pay out-of-pocket, unless you have supplemental coverage, like a Medicare Supplement Insurance (Medigap) policy, or you join a Medicare Advantage Plan.”
CNBC reported, “Additionally, so-called income-related adjustment amounts, or IRMAAs, will kick in for single beneficiaries at modified adjusted gross income of more than $97,000, up from $91,000 this year. For married beneficiaries filing a joint tax return, the extra monthly charge will apply if income is above $194,000, up from $182,000 this year.”
Why the decrease in premium?
A MarketWatch report said that “The decrease can be attributed to previously higher estimated projections for spending on Part B services and a new Alzheimer’s drug called Aduhelm, CMS said. The overestimate led to a larger reserve in the Part B account, which the government passed on to cut any premium increase for beneficiaries, the agency said.“
Medicare open enrollment starts Oct. 15.