Below is a breakdown of the projected costs and rates of inflation for Medicare coverage from the Medicare Board of Trustees “Annual Report”. At this point, these are projections and should not be considered final. The Centers of Medicare and Medicaid Services will release the final 2016 Medicare costs later this year.
For Part A:
The Part A deductible is projected to increase 3.17% to $1,300. It is expected to increase at an annual average rate of 3.05% through 2024.
Please note: those enrolling into any MediGap Plan for added coverage will have this increase covered automatically.
For Part B:
The Part B premium is projected to increase 51.85% to $159.30. The Board of Trustees is also projecting that this premium will be decreased by approximately 24.2 % in 2017 (to $120.70). This “decrease” in 2017 will be an increase for those Medicare beneficiaries who were held harmless in 2016. Those beneficiaries will experience an increase of approximately 70%. Because of this decrease, the Hold Harmless Act will not be a consideration in 2017 and some beneficiaries may see a decrease in their overall Social Security benefit.
Between 2017 through 20204 the Part B premium is then expected to increase at an annual average rate of 5.7%.
The Part B deductible cost is also expected to increase by 51.7% in 2016. It will then decrease in 2017 by 24.2% to $169. Thereafter, the deductible is projected to increase at an annual average rate of 5.34% through 2024.
Please note: those enrolling into any MediGap Plan for added coverage will have this expense covered automatically.
The Income Related Monthly Adjustment Amount (IRMAA) (more commonly known as means testing) is projected to follow the same percentage increases and decrease as the Medicare Part B premium.
For Part D:
The National Base Premium for Medicare’s Part D coverage is projected to increase by just over 13.67% from 2015 to 2016. This represents a change from $33.13 to $37.66 per month, and is expected to continue to increase by 6.9% on average over the next 8 years until 2024.
Please note, the National Base Premium is only used as a guide when assessing any surcharges for late enrollment penalties, as well as those who are defined as having too much income due to Medicare’s Income Related Monthly Adjusted Amount (IRMAA).
The Part D Deductible is projected to increase by 12.5% to $360, up from $320 in 2015. Through 2017 to 2024, the deductible is expected to increase by 6.34% on average..
For Medicare’s Part D IRMAA, the Medicare Board of Trustees is projecting slightly different rates for each bracket, but on average there is an expected increase of 13.75% from 2015 to 2016. Through the years 2017 to 2024, the expected average increase for all brackets is 6.91%.
