Medicare Part B premiums to rise 52% for 7 million enrollees

October 09 07:50 2015

For seven in 10 Medicare beneficiaries 2016 will be much like 2015. They will pay $104.90 per month for their Medicare Part B premium just as they did in 2015. But 2016 might not be anything like 2015 for some 30% of Medicare beneficiaries — roughly 7 million or so Americans. That’s because premiums for individuals could increase a jaw-dropping 52% to $159.30 per month ($318.60 for married couples). And for individuals whose incomes exceed certain thresholds, premiums could rise to anywhere from $223.00 per month up to $509.80 (or $446 to $1,019.60 for married couples), depending on their incomes.

What gives? Blame the “hold harmless” provision in the law that addresses cost-of-living adjustments (COLA) for Social Security benefits. That law limits the dollar increase in the premium to the dollar increase in an individual’s Social Security benefit, according to a report by Alicia Munnell of the Center for Retirement Research at Boston College.

At the moment, the consumer price index (CPI) is not expected to increase in the period used to determine the COLA for 2016. And that means it’s very likely that Social Security recipients — for just the third time since automatic adjustments were adopted in 1975 — will not receive an increase in their benefit next year, according to Munnell’s report.

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