About 37 million seniors will not face any Medicare premium increases in 2016, while about 15 million will face a 13 percent hike.
The Centers for Medicare and Medicaid Services announced late Tuesday the 2016 premiums and deductibles for Medicare Part A, which covers hospital costs, and Part B which covers physician and outpatient programs.
About 70 percent of the nation’s 52 million Medicare beneficiaries will pay the same monthly premium next year of $104.90. The remaining 30 percent will pay $121.80.
The reason for the disparity is a small provision in federal law called “hold harmless.”
Federal law limits a Medicare premium increase to the increase in an individual’s Social Security benefits. Next year there will not be a cost of living increase for Social Security, so the premiums for Part B will not be raised.
But the hold harmless provision doesn’t affect all beneficiaries. These include seniors who don’t get Social Security, are enrolled in both Medicare and Medicaid, new beneficiaries and high-income beneficiaries.
The roughly $20-per-month increase for those beneficiaries is better than it could have been. They were estimated to pay a monthly premium of $159.30, but the two-year budget deal recently approved by Congress and signed by President Obama mitigated the premium increase.
The agency announced that the annual deductible for Part B will be $166 next year.
The announcement doesn’t affect premiums for Medicare Advantage, a program that lets seniors buy private health plans, and prescription drug plans already finalized, the agency said.
