The Inflation Reduction Act of 2013 causes the Medicare Part A premium and deductible to rise in 2023 while the Medicare Part B premium and deductible fall and the Medicare Part D premium and deductible improve.
What are the changes to Medicare benefits for 2023?
A: In 2023, Medicare recipients will see a number of policy shifts. The annual Medicare enrollment period is from October 15 to December 7, and during that time beneficiaries can make changes to their Medicare Advantage and Medicare Part D plans.
However, there are additional adjustments to Original Medicare’s cost-sharing and premiums, as well as high-income tax rates and other factors.
Did the Medicare Part B standard premium increase for 2023?
Medicare Part B’s basic monthly premium is $170.10 in 2022 and drops to $164.90 the following year. A decline of this magnitude has not been seen between the same time periods since 2012. In 2022, Medicare Part B spending came in lower than projected, creating a surplus that is being used to lower premiums in 2023.
One reason for this is that Medicare’s spending on the new Alzheimer’s medicine Aduhelm, which was a major factor in the 2022 hike to Part B rates, was lower than predicted. (In 2022, the regular Medicare Part B premium will be $22 per month higher than in 2021’s record-high $148.50; this is the biggest annual percentage rise in premium cost in the program’s history.)
The cost-of-living adjustment (COLA) for Social Security recipients in 2023 is 8.7 percent, the highest it has been in decades. Part B premiums are withdrawn from seniors’ Social Security payments, and in 2022, a sizeable portion of the COLA went toward paying for these premium increases. Thankfully, the Part B price is falling in 2023, and seniors won’t have to worry about this. Therefore, retirees will be able to use the full COLA in 2022 to help offset the significant rise in their overall cost of living.
If an individual’s cost-of-living adjustment (COLA) is less than the total increase in their Medicare Part B premium, then their Part B premium may not go up by more than the COLA. Since Social Security payments are already reduced by the amount needed to cover Part B premiums, it is impossible for annual net payments to decrease. That wasn’t a problem in 2022 thanks to the size of the COLA, and it won’t be in 2023 thanks to the size of the COLA and the lack of a Part B rate rise.
How much is the Part B deductible for 2023?
In 2022, your Medicare Part B deductible will be $233, and in 2023, it will be $226. In 2012, the last time the Part B deductible was lowered was in 2014.
The Part B deductible may be covered in full or in part by supplemental insurance for some enrollees. These are Medicare Parts A and B, as well as Medigap Policies C and F, and Medicaid. However, new Medicare beneficiaries have not been permitted to sign up for Medigap plans C or F from the year 2020. (people can keep them if they already have them, and people who were already eligible for Medicare before 2020 can continue to purchase them). The Medicare Access and CHIP Reauthorization Act of 2015 included a provision that prohibits the selling of Medigap policies that cover the Part B deductible for new enrollees (MACRA). It’s an attempt to reduce healthcare spending by making participants pay a portion of their medical bills out of their own pockets.
Benefits structures for Medicare Advantage plans have fluctuated in different ways over the past few years due to the fact that many of them have modest copays and deductibles that do not always increase in lockstep with the Part B deductible. (If a Medicare Advantage plan has a separate premium, members must pay it in addition to the Part B payment; however, many Advantage plans do not, thus enrollees often pay only the Part B premium. Medicare Advantage programs combine Original Medicare’s Parts A and B with typically Part D and a variety of additional coverages; yet, their members incur different out-of-pocket expenses because to this consolidation.
Part A premiums, deductible, and coinsurance
Medicare Part A is responsible for paying for inpatient care. Although most subscribers do not pay a premium for Part A, there are still out-of-pocket expenditures for hospital care incurred by Part A registrants. However, if you don’t have 40 quarters of employment history, you’ll have to pay a higher Part A premium (or a spouse with 40 quarters of work history).
Are Part A premiums increasing in 2023?
About one percent of Medicare Part A enrollees actually pay for their coverage, with the rest receiving it at no cost because of their or their spouse’s employment records. Annual rates for Medicare Part A have been rising, and that pattern will continue beginning in 2023.
Part A premiums for those with 30 or more quarters of work experience (but fewer than 40) will increase to $278 per month in 2023 from $274 per month in 2022. In addition, the monthly cost for Medicare Part A for those with fewer than 30 quarters of work history will increase to $506 in 2023 from $499 in 2022.
Is the Medicare Part A deductible increasing for 2023?
Each benefit period is subject to the Part A deductible (rather than a calendar year deductible like Part B or private insurance plans). In most cases, the deductible rises annually. In 2023, it will rise to $1,600, up from $1,556 in 2022. All Medicare Part A participants are subject to the deductible, albeit a sizable percentage of those people have supplementary insurance that pays all or most of the deductible.
How much is the Medicare Part A coinsurance for 2023?
Medicare Part A pays for the first 60 days of inpatient care for an enrollee within a benefit period. During the same term of benefits, the individual will be responsible for paying a daily coinsurance fee if they require further inpatient coverage. The cost of inpatient care on days 61-90 in 2023 will increase to $400 (from $389 in 2022) due to inflation. This means that in 2022, the coinsurance for lifetime reserve days will be $800 per day, an increase over the previous year’s rate of $778 per day.
Care at a skilled nursing facility is initially covered by the Medicare Part A deductible that was paid for the inpatient hospital stay that preceded the skilled nursing facility stay up to a maximum of 20 days. (Usually, for Medicare to pay for nursing home treatment, a patient must have been an inpatient for three days before being transferred to a nursing home; but, due to the current COVID epidemic, this requirement has been temporarily suspended.) But from day 21 through day 100 in a care home, you’ll have to pay a coinsurance. The daily rate will increase to $200 in 2023 from $194.50 in 2022.
