House Passes Bi-Partisan Budget Bill, Addresses Medicare Part B Premium Increase

Late Wednesday, the House of Representatives passed a budget deal that increases spending for military and domestic purposes and increases the debt limit. The deal also addresses the increase in Medicare Part B premiums that is otherwise projected to impact 30 percent of beneficiaries, and an increase in the Medicare Part B deductible that would have impacted all Part B enrollees.

Due to a combination of higher than projected Medicare outpatient costs in 2015 and the lack of a cost-of-living increase for Social Security recipients, premiums for some beneficiaries are projected to increase from $104.90 to over $150—or more for those with higher incomes. Other beneficiaries, those who have their Part B premium deducted from their Social Security check, are “held harmless” and protected from increased Part B premiums where there is no increase in their check. This means that the increase would fall on a smaller group, and is therefore projected to be larger for each affected person. The Part B deductible, or amount people have to pay out of pocket before their coverage begins, is also set to increase to about $223.

If passed by the Senate, the budget deal will take what the premium would have been had the increase been spread across all enrollees, and will “loan” the difference to beneficiaries from the Medicare trust fund, making their premium for next year about $120. Beneficiaries as a group will have to repay that loan by paying a $3 per month surcharge. The deal also reduces the projected Part B deductible from about $223 to around $167 and prevents a 20% cut in Social Security Disability Benefits from going into effect.

Read more about the budget deal.