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Posted on 5. January 2017

How Much Will My Medicare Cost in 2017?

By Cate Kortzeborn

Not long ago, I had dinner with a group of friends from college. One of the big topics of conversation was Medicare, for which we’ll all be eligible in the next several years. (Farewell, callow youth!) And one of the biggest questions about Medicare was, "How much is it going to cost me?"

Like private health insurance, Medicare has premiums, deductibles and co-pays. These costs can - and often do - change from year to year. What you actually pay depends on your work history, income and inflation.

Only about 1 percent of people with Medicare pay a monthly premium for Medicare Part A, which covers inpatient hospitalization, skilled nursing care and some home health services. That’s because they paid Medicare paycheck deductions for 40 quarters or longer during their working lives.

Most people do, however, pay a monthly premium for Medicare Part B, which covers doctor fees, outpatient treatment, durable medical equipment and other items. Part B premiums are rising next year, but for most people, the increase won’t be very much.

The law protects most seniors from Part B premium hikes if the cost-of-living adjustment (COLA) in their Social Security benefit doesn’t go up in a given year. Since the Social Security COLA for 2017 will be 0.3 percent, about 70 percent of Medicare beneficiaries will pay an average Part B premium of $109 per month in 2017. That’s up from $104.90 for the past four years.

The remaining 30 percent of Medicare’s 58 million beneficiaries will pay the standard Part B premium of $134 for 2017, a 10 percent increase over the 2016 premium of $121.80. This smaller group is not protected under the statutory "hold harmless" provision linked to the Social Security COLA. It includes people who don’t receive Social Security benefits; enroll in Part B for the first time in 2017; are directly billed for their Part B premium; are eligible for both Medicare and Medicaid and have their premiums paid by a state agency; and pay higher premiums based on their higher incomes.

This year, as in the past, the government has worked to lessen projected premium increases for these beneficiaries, while maintaining a prudent level of reserves to protect against unexpected costs. The U.S. Department of Health and Human Services will work with Congress as it explores budget-neutral solutions to challenges created by the "hold harmless" provision.

Part B also has an annual deductible, which will rise to $183 in 2017 (compared with $166 in 2016). After your deductible is met, you typically pay 20 percent of the Medicare-approved amount for most doctor services (including most doctor services while you're a hospital inpatient), outpatient therapy and durable medical equipment.

The Part A deductible, which you pay when admitted to the hospital, will be $1,316 per benefit period in 2017, up from $1,288 in 2016. This deductible covers your share of costs for the first 60 days of Medicare-covered inpatient hospital care in a benefit period.

People with Medicare pay coinsurance of $329 per day for the 61st through 90th day of hospitalization ($322 in 2016) in a benefit period, and $658 per day for lifetime reserve days ($644 in in 2016).

For beneficiaries in skilled nursing facilities, the coinsurance for days 21 through 100 in a benefit period will be $164.50 in 2017 (versus $161 in 2016).

Since 2007, higher-income people with Medicare have paid higher Part B premiums. These income-indexed rates affect about 5 percent of people with Medicare. So, for example, a person with Medicare who files an individual tax return showing an income between $85,000 and $107,000 will pay a Part B premium of $187.50 per month next year.

Some people choose to get their benefits through privately-operated Medicare Advantage health plans, or purchase a Medicare Part D plan to help cover their prescription drug costs. Many of these plans carry their own monthly premiums.

For more information about 2017 premiums and deductibles, go to www.medicare.gov, or call Medicare any time of day or night, at (800) MEDICARE (633-4227).

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Comments (2) -

William G. Moore
6:36 AM on Friday, January 06, 2017

I am a PI patient who gets IVIG every three weeks.  Fortunately, I was diagnosed after I became eligible for Medicare.  I chose to use traditional Medicare with supplemental coverage from AARP.  I also have Part D insurance for medications from AARP.  I have been able to use any physician without referrals, including those in other areas of the country.  This is particularly important if you travel.  I have affordable copays for drugs, IVIG, and physician office visits.  I would caution IVIG patients to be very careful if considering a Medicare Advantage plan.  While the monthly premiums might be less, the compromise from traditional Medicare might not be worth it.  Being able to see any physician, even specialists, without prior approval plus obtain IVIG where most convenient are very valuable benefits.

Jonah Kuhlman
6:46 AM on Friday, April 07, 2017

As a Medicare recipient under the age of 65, I no longer can afford IVIG. The co-insurance for it would quickly deplete my IRA and render me unable to pay my regular bills and living expenses. In addition, due to the funds I have in my IRA, I've been asked to pay more for my Medicare coverage. My monthly SSDI check, after deductions for the various parts of Medicare, is a little over $800. I moved to a rural area to cut costs but have found zero physicians who have any knowledge of treating a person with a primary immunodeficiency so I've opted for traditional Medicare so that I can travel outside my area to receive appropriate care. Because of this, I have no cap on the total amount I will have to pay for my care each year. Twenty percent of expensive care amounts to a lot of money. I have watched my health steadily deteriorate since beginning coverage with Medicare three years ago. If you are under 65 and don't have generous reserves of money, be careful about your decision to apply for disability. In my state, there is no mandate that 'medi-gap' insurance be made available to people under 65 so I am unable to purchase such coverage as a result--no one sells it. I'm currently facing biopsies to determine if I have cancer and know that I will not be able to afford treatment if I do. I will die because I can't afford to pay for the care I need. These are complex issues that I was not aware of prior to becoming so ill that I could no longer work. Do excellent research before making decisions--it could mean the difference between health and disability or even life and death.

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