In a move that will affect nearly 66 million Americans, the Centers for Medicare & Medicaid Services (CMS) has announced an increase in the standard monthly premium for Medicare Part B for 2024. This decision comes amidst a backdrop of rising healthcare costs and the introduction of new medical treatments.
Medicare Part B Premiums: A Closer Look
Medicare Part B, which covers specific doctors' services, outpatient care, medical supplies, and preventive services, will see its standard monthly cost rise by $9.80, marking a 6% increase. This adjustment will bring the monthly premium to $174.70 in 2024, up from $164.90 in 2023. Additionally, the annual deductible for Medicare Part B beneficiaries will experience a hike, moving from $226 in 2023 to $240 in 2024.
This increase aligns with earlier projections by the Medicare Trustees. However, it is notably lower than some experts had anticipated. Mary Johnson, a Social Security and Medicare policy analyst at the nonprofit advocate The Senior Citizens League, commented, "We are relieved to learn that the Medicare Part B increase in 2024 won't be as high as we initially feared." Concerns had arisen after the CMS approved Leqembi, a new and expensive Alzheimer's drug, which some believed would significantly impact Medicare Part B premiums.
Factors Driving the Increase
The 2024 rise in Medicare Part B premiums follows a $5.20 monthly decrease in 2023 compared to 2022. The reduction was attributed to lower-than-expected spending on the Alzheimer's drug Aduhelm and other Part B items and services. However, the upcoming increase for 2024 is primarily due to projected hikes in healthcare spending. Additionally, there's a need to repay providers for underpayments that occurred from 2018 to 2022.
Income-Based Premiums
While the general cost for Medicare Part B will be $174.70 monthly in 2024, about 8% of beneficiaries with higher incomes will be required to pay more. For instance, individuals with a gross income ranging between $103,000 and $129,000 will have to pay $244.60 a month for Part B, rather than the standard $174.70. Those at the highest income bracket, earning at least half a million dollars, will be charged $584 monthly.
Other Medicare Costs for 2024
Medicare Part A, which covers inpatient hospital care and certain other services, will also see cost adjustments in 2024. The deductible for each hospital stay under Medicare Part A will rise by $32, bringing it to $1,632 per stay in 2024. For those who haven't worked long enough to qualify for premium-free Part A, the monthly premium will be $505, a $1 decrease from 2023.
Impact on Social Security Recipients
For many Social Security recipients, the Medicare Part B premium is automatically deducted from their monthly checks. This means that the increase in Medicare payments will offset some of the benefits from the Social Security cost of living adjustment (COLA) for 2024. The COLA for 2024 has been set at 3.2%, translating to an average monthly increase of more than $54.58. However, $14 will be deducted from this amount to cover the higher Medicare Part B premium.
The adjustments in Medicare premiums for 2024 highlight the challenges of balancing healthcare costs with the needs of beneficiaries. As medical treatments evolve and healthcare spending continues to rise, beneficiaries and policymakers alike will need to navigate the financial implications to ensure that quality care remains accessible to all.
