Prices seem to be going up everywhere and everything is getting more expensive. Consumer prices continue to rise and are up 8.2% from a year ago. For seniors on a fixed income, this is hitting especially hard. Many are watching their retirement savings dip while the costs of basics such as food, gas and medicine continue to increase.
But there is some good news on the horizon to help offset these rising costs. Cost-of-living adjustments for Social Security are tied to the consumer price index, and seniors will be seeing an 8.7% increase in 2023, the highest increase in 40 years.
2023 Medicare costs are a mixed bag, with some premiums and deductibles decreasing, while others are showing a slight increase. Here is a summary of what is changing:
Medicare Part A
Most Part A enrollees pay no Part A premium because they were employed for at least 40 quarters or 10 years. For those who pay the full monthly Part A premium, there will be an increase of $7 to $506 in 2023. Even those who qualify for premium-free Part A need to pay the deductibles and coinsurance. These out-of-pocket costs are also increasing in 2023.
- The inpatient deductible is going from $1,556 in 2022 to $1,600 in 2023.
- The daily coinsurance for the 61stto 90th day is going from $389 in 2022 to $400 in 2023.
- The daily coinsurance for lifetime reserve days is going from $778 in 2022 to $800 in 2023.
- The skilled nursing facility coinsurance is going from $194.50 in 2022 to $200 in 2023.
Medicare Part B
In 2022 Medicare enrollees saw an increase in Medicare Part B premiums and deductibles, in part due to the anticipated expense of a new Alzheimer’s drug Aduhelm. Since the costs associated with this drug were lower than projected, this created a larger than expected financial reserve, allowing Part B costs to decrease for 2023.
- The deductible is going from $233 in 2022 to $226 in 2023.
- The standard premium is going from $170.10 in 2022 to $164.90 in 2023.
- In 2023, beneficiaries with an adjusted gross income of $97,000 or more on an individual tax return or $194,000 or more on a joint tax return will be subject to higher premiums. CMS says this affects about 7% of enrollees.
Medicare Part C (Medicare Advantage)
The average Medicare Advantage premium is expected to decrease in 2023. CMS says that the average monthly premium is expected to be $18, an 8% drop from the average premium of $19.52 in 2022.
Medicare Advantage premiums can vary greatly, with some plans offering $0 premiums. People who enroll in a Medicare Advantage plan must also pay the Part B premium, so they need to factor that into their costs.
Medicare Part D
CMS is projecting the average Medicare Part D monthly premium will decrease 1.8% from $32.08 in 2022 to $31.50 in 2023.
Medicare Part D enrollees are also subject to income-related month adjustments. In 2023 beneficiaries with an adjusted gross income of $97,000 or more on an individual tax return, or $194,000 or more on a joint tax return will be subject an additional charge of at least $12.20. Individuals in the highest income bracket will pay an additional $76.40 per month.
Help Your Clients Anticipate the Changes for 2023
As a Medicare agent, you play a key role in helping your clients anticipate and understand the Medicare cost changes that will affect their budget and possibly the choices they make for their health insurance coverage in 2023.
You may also find that more of your clients may qualify for additional assistance, through federal programs such as Medicare Savings Programs and Extra Help, or state programs such as Medicaid and Texas Rx Assistance Programs.
When you take the time to educate yourself, your clients will value your knowledge and see you as a trusted advisor, helping to build a long-term relationship into the future.