Medicare Part B Premium Increase for 2016

Democracy must be something more than two wolves and a sheep voting on what to have for dinner. – James Bovard, American author and lecturer, Lost Rights: The Destruction of American Liberty, Palgrave Macmillan. 1995.

Got some extra money laying around that you need to spend to lighten your wallet? How about this suggestion?

Unless there is quick Congressional action, more than seven million people (nearly a third of all Medicare Part B beneficiaries) will pay a 52 percent increase in Part “B” premiums during 2016. Premiums will jump from 2015′s $104.90 to $159.30 for individuals and to $318.60 for married couples. 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.

Just a reminder: Part B generally covers medically necessary doctors’ services, outpatient care, home health services, durable medical equipment and many preventive services. Part A covers in-patient hospital stays – under most circumstances, but that’s another column for another day.

The increase will affect five main types of Part B enrollees. Everyone new to Medicare in 2016, Medicare beneficiaries who do not receive Social Security income, beneficiaries who are directly billed for their Part B premium, dually eligible Medicare and Medicaid beneficiaries and high-income beneficiaries. “High-income” is in the eye of the beholder, it seems, for the increased premium amount kicks in when a single individual earns more than $85,001 per year.

There is a “hold-harmless” provision in the Social Security Act that attempts to protect some from such an increase. “It basically provides that Part B premiums cannot rise more than the amount a person’s Social Security benefits rise due to inflation,” writes Joseph Stenken, author of 2015 Social Security & Medicare Facts. The rule ensures that Social Security checks will not decline from one year to the next because of increases in Medicare Part B premiums. The rule applies to most, but not all, Social Security recipients. It does not apply to the five categories mentioned above.

Since there will be no cost of living increase (COLA) in 2016, only the third time in 40 years, the “hold harmless” provision will kick in for approximately 70% of social security beneficiaries, who will see no premium increase. The other 30 per cent are the ones who will be disadvantaged by the steep hike in premiums.

This, of course, will cause a likely showdown between policymakers and senior activist groups. AARP has already promised to fight the increase. Max Richman, Chairman of the Leadership Council of Aging Organizations, has written a letter to each Senator, protesting the increase and asking them to support the “Protecting Medicare Beneficiaries Act of 2015″ S.2148. This legislation would keep the 2016 premium stable for all Medicare beneficiaries. It will also maintain the 2015 deductibles for all beneficiaries. Oh, did I forget to mention that, absent congressional action, the deductibles for beneficiaries will also rise in 2016 for all Medicare enrollees, not just the 30%.

When the grandkids were little and my husband took them to McDonald’s, he always pretended to steal their fries and told them “Keep your eyes on your fries!” As senior citizens, and advocates for our elderly friends and neighbors, it is extremely important for each of us to keep our eyes on what the government is doing – all the time.

Thanks for reading. Stay well.