On September 27, 2022, Medicare announced that Medicare Part B premiums will decrease in 2023. That’s really happening because Medicare Part B premiums will be lowered by $5.20, going from $170.10 a month to $164.90. The program’s annual deductible will also fall by $7.00, from $233.00 to $226.00.
Part B Premium Decreases
Medicare costs going down? The last time this happened was in 2012, when the fee for Part B fell from $115.40 to $99.90 a month. And just for context, let’s remember that in 2022, Medicare Part B premiums actually rose by 14.5 percent. That, we believe, is the largest annual increase in the history of Medicare.
Why did that big increase happen? It’s because the 2022 premium added a contingency margin to cover anticipated big spending for a new drug, Aduhelm, which was introduced to reduce the symptoms of Alzheimer’s Disease. As things worked out, demand for Aduhelm was less than Medicare anticipated, so that increase in fees is now being rolled back.
Let’s Get the Medicare News from the Source
Here’s the text of the official announcement about the new Medicare cost reduction, as released by the Centers for Medicare and Medicaid Services:
Medicare Part B covers physician services, outpatient hospital services, certain home health services, durable medical equipment, and certain other medical and health services not covered by Medicare Part A.
Each year the Medicare Part B premium, deductible, and coinsurance rates are determined according to the Social Security Act. The standard monthly premium for Medicare Part B enrollees will be $164.90 for 2023, a decrease of $5.20 from $170.10 in 2022. The annual deductible for all Medicare Part B beneficiaries is $226 in 2023, a decrease of $7 from the annual deductible of $233 in 2022.
The 2022 premium included a contingency margin to cover projected Part B spending for a new drug, Aduhelm. Lower-than-projected spending on both Aduhelm and other Part B items and services resulted in much larger reserves in the Part B account of the Supplementary Medical Insurance (SMI) Trust Fund, which can be used to limit future Part B premium increases. The decrease in the 2023 Part B premium aligns with the CMS recommendation in a May 2022 report that excess SMI reserves be passed along to people with Medicare Part B coverage.
Beginning in 2023, certain Medicare enrollees who are 36 months post kidney transplant, and therefore are no longer eligible for full Medicare coverage, can elect to continue Part B coverage of immunosuppressive drugs by paying a premium. For 2023, the immunosuppressive drug premium is $97.10.
Why Is This Small Medicare Fee Reduction Big News?
In a sense, a reduction of $5.20 really can’t be seen as big news. After all, what can you buy with $5.20? It would just about cover the cost of a bottle of aspirin.
But in another sense, any reduction in Part B costs is significant. It signals that Medicare really is playing it fair and square with Medicare recipients. If Medicare is spending less, the program is willing to share the money it is saving with you.
Another reason we need to pay attention to even small changes in Medicare is that they can add up. Small changes like these can affect you:
- Medications you have been taking might have gone generic or have been assigned to a lower tier, which can save you money.
- A wider selection of physicians and other caregivers might have been opened up in your geographical area, offering you new options.
- A medical procedure you are planning to receive in the next year might have become newly covered by your plan – or vice versa.
Be Sure to Review Your Plan with a Qualified Medicare Expert
If changes are taking place that could affect you, you want to know what they are. The easiest way to stay on top of all these small changes is to have a quick, cost-free consultation with one of CoverRight’s Medicare Concierges.