Policy & Regulation News

CMS Confirms More Affordable 2016 Medicare Part B Premiums

“Our goal is to keep Medicare Part B premiums affordable."

By Jacqueline DiChiara

- Healthcare consumers’ wallets will apparently be a tad fuller next year. 2016 will not see a cost of living increase for those under Social Security, according to an announcement from the Centers for Medicare & Medicaid Services (CMS).

Medicare Part B Medicare Part A

The majority of people with Medicare Part B will be “held harmless” from a premium increase next year. Monthly premiums – currently around $104 – will remain unchanged, CMS confirmed.

Beneficiaries not falling under this provision will pay about $122, according to calculations determined by the Bipartisan Budget Act. A 2015 Medicare Trustees Report estimated this premium would be closer to $160, CMS confirmed.

Nearly 1 in 3 of the 52 million individuals planning to enroll in Medicare Part B next year will not be subject to the “hold-harmless” provision, CMS confirmed. This includes individuals not collecting Social Security benefits, those enrolling in Part B for the very first time, and dual eligible beneficiaries.

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  • “Our goal is to keep Medicare Part B premiums affordable. Thanks to the leadership of Congress and President Obama, the premiums for 52 million Americans enrolled in Medicare Part B will be either flat or substantially less than they otherwise would have been,” said Andy Slavitt, CMS’s Acting Administrator.

    “Affordability for Medicare enrollees is a key goal of our work building a health care system that delivers better care and spends health care dollars more wisely.”

    California tops Medicare Part B savings by state

    According to estimates from the CMS Office of the Actuary, these premium modifications will save states $1.8 billion.

    Next year, the state of California may save the most – $288 million. The state of New York comes in second with an estimated $154 in savings. Texas comes in third at $128 million. Trailing right behind in fourth place is Florida with $125 million in expected savings.

    States have established programs that offer payment assistance for dual eligible beneficiaries’ premiums, CMS asserted. States additionally have programs readily available to aid in cost sharing for some Medicare beneficiaries of low socioeconomic status.

    Medicare Part A premium, deductible information

    According to CMS, the 2016 Medicare Part A annual deductible for beneficiaries facing hospital admittance is expected to be about $1,288. This is a slight increase from the 2015 Medicare Part A annual deductible amount of $1,260.

    The $1,288 covers costs for the first 60 days of Medicare-covered inpatient hospital care within a beneficiary’s benefit period, CMS stated. Daily coinsurance amounts will reportedly be $322 for hospitalization day 61 through 90 and $644 for lifetime reserve days.

    This deductible covers costs for the first 60 days of Medicare-covered inpatient hospital care, confirmed CMS. Around 99 percent of Medicare beneficiaries reportedly do not pay a Part A premium.

    “Enrollees age 65 and over who have fewer than 40 quarters of coverage and certain persons with disabilities pay a monthly premium in order to receive coverage under Part A,” CMS explained.

    Those individuals with between 30-39 quarters of coverage may purchase a discounted Part A rate at $226 next year, CMS said. This is a $2 increase compared to the current year. Those with coverage below 30 quarters will pay the full monthly amount of $411, a $4 spike compared to 2015.