2016 Medicare Part B Premiums and Deductibles Announced

By on November 11, 2015 in Retirement with 22 Comments

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The Centers for Medicare and Medicaid Services has announced the 2016 premiums and deductibles for the Medicare outpatient hospital services (Part B) programs.

Part B Premiums/Deductibles

As the Social Security Administration previously announced, there will no Social Security cost of living increase for 2016. As a result, by law, most people with Medicare Part B will be “held harmless” from any increase in premiums in 2016 and will pay the same monthly premium as last year, which is $104.90.

Beneficiaries not subject to the “hold harmless” provision will pay $121.80, as calculated reflecting the provisions of the Bipartisan Budget Act signed into law by President Obama last week.

Medicare Part B beneficiaries not subject to the “hold-harmless” provision are those not collecting Social Security benefits, those who will enroll in Part B for the first time in 2016, dual eligible beneficiaries who have their premiums paid by Medicaid, and beneficiaries who pay an additional income-related premium. These groups account for about 30 percent of the 52 million Americans expected to be enrolled in Medicare Part B in 2016.

CMS also announced that the annual deductible for all Part B beneficiaries will be $166.00 in 2016. Premiums for Medicare Advantage and Medicare Prescription Drug plans already finalized are unaffected by this announcement.

Because of slow growth in medical costs and inflation, Medicare Part B premiums were unchanged for the 2013, 2014, and 2015 calendar years. The “hold harmless” provision would have required the approximately 30 percent of beneficiaries not held harmless in 2016 to pay an estimated base monthly Part B premium of $159.30 in part to make up for lost contingency reserves, according to the 2015 Trustees Report. However, the Bipartisan Budget Act of 2015 mitigated the Part B premium increase for these beneficiaries and states, which have programs that pay some or all of the premiums and cost-sharing for certain people who have Medicare and limited incomes. The CMS Office of the Actuary estimates that states will save $1.8 billion as a result of this premium mitigation.

To get more information about state-by-state savings, visit the CMS website at https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2015-Fact-sheets-items/2015-11-10.html

Since 2007, beneficiaries with higher incomes have paid higher Part B monthly premiums. These income-related monthly adjustment amount (IRMAA) affect fewer than 5 percent of people with Medicare.

Under the Part B section of the Bipartisan Budget Act of 2015, high income beneficiaries will pay an additional amount. The IRMAA, additional amounts, and total Part B premiums for high income beneficiaries for 2016 are shown in the following table:

Beneficiaries who file an individual tax return with income: Beneficiaries who file a joint tax return with income: Income-related monthly adjustment amount Total monthly premium amount
Less than or equal to $85,000 Less than or equal to $170,000

$0.00

$121.80

Greater than $85,000 and less than or equal to $107,000 Greater than $170,000 and less than or equal to $214,000

48.70

170.50

Greater than $107,000 and less than or equal to $160,000 Greater than $214,000 and less than or equal to $320,000

121.80

243.60

Greater than $160,000 and less than or equal to $214,000 Greater than $320,000 and less than or equal to $428,000

194.90

316.70

Greater than $214,000 Greater than $428,000

268.00

389.80

Premiums for beneficiaries who are married and lived with their spouse at any time during the taxable year, but file a separate return, are as follows:

Beneficiaries who are married and lived with their spouse at any time during the year, but file a separate tax return from their spouse:

Income-related monthly adjustment amount

Total monthly premium amount

Less than or equal to $85,000

$0.00

$121.80

Greater than $85,000 and less than or equal to $129,000

194.90

316.70

Greater than $129,000

268.00

389.80

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Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce. Ian also has a background in web development and does the technical work for the FedSmith.com web site and its sibling sites.

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