House Passes Bi-Partisan Budget Bill, Addresses Medicare Part B Premium Increase

Late Wednesday, the House of Representatives passed a budget deal that increases spending for military and domestic purposes and increases the debt limit. The deal also addresses the increase in Medicare Part B premiums that is otherwise projected to impact 30 percent of beneficiaries, and an increase in the Medicare Part B deductible that would have impacted all Part B enrollees.

Due to a combination of higher than projected Medicare outpatient costs in 2015 and the lack of a cost-of-living increase for Social Security recipients, premiums for some beneficiaries are projected to increase from $104.90 to over $150 – or more for those with higher incomes. Other beneficiaries, those who have their Part B premium deducted from their Social Security check, are “held harmless” and protected from increased Part B premiums where there is no increase in their check. This means that the increase would fall on a smaller group, and is therefore projected to be larger for each affected person. The Part B deductible, or amount people have to pay out of pocket before their coverage begins, is also set to increase to about $223.

If passed by the Senate, the budget deal will take what the premium would have been had the increase been spread across all enrollees, and will “loan” the difference to beneficiaries from the Medicare trust fund, making their premium for next year about $120. Beneficiaries as a group will have to repay that loan by paying a $3 per month surcharge. The deal also reduces the projected Part B deductible from about $223 to around $167 and prevents a 20% cut in Social Security Disability Benefits from going into effect.

Read more about the budget deal.

See the six important things to know about Fall Open Enrollment.

Medicare Rights Center Responds to House Budget

In a written statement, Joe Baker, President of Medicare Rights, commended the House of Representatives for taking action to pass a budget that shields older adults, people with disabilities, and state Medicaid programs from drastic increases in the Medicare Part B premium and deductible in 2016.

Baker said, “This budget deal represents a bipartisan effort to find sensible solutions to significant problems, and to mitigate the impact of a potential spike in premiums for approximately 30 percent of people with Medicare and a large increase in the Part B deductible for all people with Medicare.

With no Social Security cost of living adjustment in 2016, many beneficiaries and their families could not bear the additional burden that a nearly 50% increase in monthly premiums and a dramatic increase in their Part B deductible would mean. The typical beneficiary has an income of $24,150 and already spends 17 percent of their income on out-of-pocket health care costs, more than other insured populations. By spreading the cost of the increased premium over time and reducing the projected deductible to $167 per year, down from $223, the House has taken necessary steps to blunt the impact of a potentially shocking, unprecedented hit to the health care costs of Medicare households.”

Read the statement.

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Last edited by Tyler Schuster.   Page last modified on October 29, 2015

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