The Supreme Court’s decision upholding much of the Affordable Care Act opened an annual unfounded rumor that is of concern for seniors on Medicare. The rumor floating around is that the per person Medicare insurance premium will increase from the present monthly fee of $99.90 to $120.20 in 2013 AND $247.00 IN 2014.
Supposedly, these are provisions incorporated in the Obamacare Legislation, purposely delayed because of the 2012 Re-election Campaign.
Is there truth to this rumor?
The short answer: No, there is not.
The 2012 Medicare Part B premiums is $99.90* for individuals with income of up to $85,000 or married couples with income up to $170,000. The premiums go up on a sliding scale for Medicare beneficiaries with higher incomes. Medicare Part B premiums, which pay for doctor’s visits and other outpatient costs, are not set arbitrarily. CMS sets the standard premium every fall for the upcoming calendar year based on a formula developed more than a decade ago by Congress. Here is a good explanation from the website for the National Committee to Preserve Social Security and Medicare:
The standard Medicare Part B premium is determined by a formula contained in the 1997 Balanced Budget Act, which set the premium at 25 percent of total program costs. The remaining 75 percent of program costs are financed through general revenues. The Medicare Modernization Act of 2003 (MMA) requires higher-income beneficiaries to pay a higher percentage of program costs, resulting in multiple tiers of premiums based on income.
The 2013 and 2014 Part B premiums haven’t been decided yet.
Also note: There has been lots of confusion about Medicare Part B premium rates in recent years, because Medicare beneficiaries who receive Social Security were protected from premium increases in 2010 and 2011 under what is called the “hold harmless” provision, which freezes Medicare Part B premiums if there is no Social Security cost-of-living adjustment.
But new Medicare enrollees, those who don’t have their premiums deducted from Social Security and higher-income Medicare beneficiaries paying higher premiums weren’t protected by the “hold harmless” provision, so they experienced premium increases in those two years, causing confusion as people with different retirement dates (and the same age) paid different Medicare premiums.
The bottom line is that Medicare Part B premiums are a hot political topic during this election. However, the formula to determine monthly Part B premiums has not changed in over 10 years and barring a drastic increase in your monthly social security check, you will not experience a sharp increase in Part B premium.
*Part B Premiums have since changed
Checking out information to be knowlegable when time to apply for medicare this fall. This information has been helpful, since I knew nothing about medicade.
Thanks for the feedback, our goal is to make Medicare enrollment and benefits easy to use and understand!