CMS Announces Largest Hike in Medicare Part B Premiums and Deductibles in the Program's History

Published in Government Relations on November 15, 2021

November 13th CMS announced that Medicare Part B premiums and deductibles will see the largest hike in the program's history next year.

Seven issues of concern…

  1. The CMS rule boosts the standard Medicare Part B premium to $170.10 a month, up $21.60, or 14.5 percent. It also increased Part B standard deductibles by $30, up 14.8 percent to $233 in 2022
     
  2. The increase translates to nearly $14,000 in annual costs for the wealthiest senior couples.
     
  3. Despite a boost in emergency Medicare spending last year, CMS raised Part B premiums less than $4.
     
  4. Part B premiums have risen 226 percent since 2000, making them one of the fastest growing costs for older Americans.
     
  5. This year, CMS attributed the Part B price hikes to rising healthcare prices and utilization, congressional efforts to limit 2021's increase and the potential to cover Biogen's expensive Alzheimer's drug, Aduhelm.
     
  6. CMS said the price hikes will be mitigated by a higher annual Social Security cost of living increase; stakeholders reported that the Medicare increase will eat up most of the record-high Social Security cost-of-living jump.
     
  7. CMS also is increasing the  Medicare Part A deductible, upping the cost per benefit period $72 to $1,556, a 4.9 percent increase.

(Forbes commentary)

The Centers for Medicare & Medicaid Services has announced Medicare Part B premiums for 2022, and the base premium increases 14.5% from $148.50 a month in 2021 to $170.10 a month in 2022. That $21.60 monthly increase ($260 a year) compares to a $3.90 monthly increase last year. Meanwhile income-related surcharges for high earners have been bumped up again too. The wealthiest senior couples will be paying nearly $14,000 a year in Medicare Part B premiums. Part B (the base and the surcharge) covers doctors’ and outpatient services.

The annual deductible for all Medicare Part B beneficiaries is $233 in 2022, an increase of $30 from the annual deductible of $203 in 2021. Last year, Congress kept the increases in the Part B premiums and the deductible in check with caps as part of a short-term budget bill. So far, no such luck this year.

The CMS announcement comes after last month’s Social Security Administration’s COLA announcement: a 5.9% cost of living adjustment for 2022, compared to the 1.3% cost of living adjustment for 2021. The average Social Security benefit for a retired worker will rise in 2022 by $92 a month to $1,657 in 2022, while the average benefit for a retired couple will grow $154 a month to $2,753.

The higher Medicare Part B premium cuts into retirees’ monthly Social Security payments. Part B premiums typically are deducted from monthly Social Security checks. You can check in December if you have an online Social Security account for your exact benefit amount.

The Part B increase will consume the entire annual cost of living adjustment of Social Security recipients with the very lowest benefits, of about $365 per month, says Mary Johnson, Social Security and Medicare policy analyst with The Senior Citizens League. Medicare Part B premiums tend to grow several times faster than Social Security benefits cost-of-living adjustments almost every year, and rising Part B premiums have ranked as one of the fastest growing costs that older Americans face in retirement, increasing 226% since 2000, Johnson says.

CMS says 7% of Medicare recipients will have to pay income-related surcharges. Earn $1 more in income, and you’re hit with the next highest monthly surcharge, meaning you could be paying $800 or more a year ($1,600 or more a year for a couple) in Medicare Part B premium surcharges.

The graduated surcharges for high-income seniors kick in for singles with modified adjusted gross income of more than $91,000 and for couples with a MAGI of more than $182,000. An individual earning more than $91,000, but less than or equal to $114,000, will pay $238.10 in total a month for Part B premiums in 2022, including a $68 surcharge. That’s up 14.5% from 2021, when they paid $207.90 total in a month, including a $59.40 surcharge.


TAGS

  1. covid-19
  2. osha

From Our Experts

[BREAKING NEWS] The DMEPOS Relief Act of 2023 is Introduced in the House thumbnail [BREAKING NEWS] The DMEPOS Relief Act of 2023 is Introduced in the House Reps. Miller-Meeks (R-IA) and Tonko (D-NY) introduced the DMEPOS Relief Act of 2023, H.R. 5555. Jeremy Stolz and Industry Leaders Collaborate with Representative Cathy McMorris-Rodgers to Enhance Healthcare System thumbnail Jeremy Stolz and Industry Leaders Collaborate with Representative Cathy McMorris-Rodgers to Enhance Healthcare System Jeremy Stolz, President of VGM & Associates and VGM Fulfillment, joined forces with fellow industry leaders in a momentous meeting with Representative Cathy McMorris-Rodgers (R-WA) on Aug. 17, 2023, in Sun Valley, ID. Uncovering Denials: OIG Reports Reveal Alarming Trends in Medicaid Managed Care Plans thumbnail Uncovering Denials: OIG Reports Reveal Alarming Trends in Medicaid Managed Care Plans In 2022, the OIG released a report outlining their findings which concluded that Medicare Advantage plans were routinely denying authorizations requests and claims for items that would be covered by traditional Medicare Fee For Service (FFS). Understanding the 75/25 Blended Rate and Why We Need Legislative Action! thumbnail Understanding the 75/25 Blended Rate and Why We Need Legislative Action! In 2020, amidst the challenges posed by the COVID-19 pandemic, the healthcare industry witnessed the introduction of the 75/25 blended rate through the passage of the CARES Act. Craig Douglas and Ronda Buhrmester recently released a podcast going into a deep explanation of the 75/25 blended rate and why keeping them in place is so important. Read the article and listen to the podcast to learn more! Ronda Vlog: Make it a Priority - A Plea to Check Surety Bonds thumbnail Ronda Vlog: Make it a Priority - A Plea to Check Surety Bonds Listen below, Ronda Buhrmester, Sr. Director of Payer Relations and Reimbursement, makes a plea for everyone to check their surety bonds before it is too late. August of Action: Making an Impact on Legislation thumbnail August of Action: Making an Impact on Legislation With summer coming to an end, the political landscape is heating up with August of Action in full swing. Advocates and activists across the nation are seizing the opportunity to engage with their legislators as they are home in their congressional districts. Find out how VGM Government Relations is kicking off our August of Action! August of Action is Fast Approaching - Act Now! thumbnail August of Action is Fast Approaching - Act Now! Every year, the House of Representatives and the Senate take a break for most of August and the first part of September, allowing elected officials to return to their home constituencies. It's a crucial time to connect with your legislators and schedule meetings to inform and update them on the current issues in the home medical equipment (HME) industry. A Win for Patients in Washington State thumbnail A Win for Patients in Washington State As we approach the effective date of numerous laws passed by the Legislature this year, we want to extend our appreciation to Don Whitney, PAMES, and all those involved in the relentless efforts to get SB 5218 passed. With the dedicated sponsorship of 4th District Sen. Mike Padden, this law marks a significant step forward in making motorized wheelchairs more accessible for everyone.