Sometimes change occurs quickly and is welcomed. Last month I flew to Germany to teach civilian army employees about their retirement benefits. On the flight to Germany, we all had to wear face masks during the entire flight. On the return flight to the United States a week later, we did not need face masks on the same airline.
When I returned home, I felt as if I had entered the Twilight Zone. Are Medicare Part B premiums going down in 2023? Is the Medicare Part B deductible going gown in 2023? Yes.
It is unusual for Medicare costs to decrease, but it has happened before years ago. Medicare started in 1966 with a $3 monthly Part B premium and a $50 annual deductible. Historically, Medicare Part B premiums and the annual deductible have gone up or stayed the same. That changed in 2012.
The primary reason for the reductions in 2012 was the formula for physician fees. The Medicare and Medicaid Extenders Act of 2010 resulted in a projected decrease of 29.5% for the formula used to determine Medicare physician payments in 2012.
Both premium and the deductible reversed course in that year because of the physician fees and went down for the beneficiaries’ benefit. The Part B premium in 2011 was $99.90 a month which was $15.50 less a month from the previous year. The annual deductible declined from $162 to $140.
In 2023, Medicare’s monthly Part B premiums will decrease from 2022’s $170.10 to $164.90. The annual deductible will be $226, falling from $233 in 2022.
The primary reason for the Medicare changes announced for 2023 is because of a recent Alzheimer’s drug, Aduhelm.
Aduhelm is an expensive drug. It was projected to cost upwards of $56,000 per year per patient in planning for the 2022 Medicare Part B premiums. This resulted in a $33 premium increase for Part B premiums from the previous year.
The premium for Part B as a result in 2022 jumped to $26.30 per month. The annual deductible for Medicare Part B beneficiaries also increased that year by $30 for an annual deductible of $233.
In April of this year, a decision was made by Medicare to consider planning to cover Aduhelm only for government-approved clinical trials. This policy shift reduced the monthly premiums and the annual deductible. The cost savings are being passed on to Medicare beneficiaries in 2023.
The Centers for Medicare and Medicaid Services issues a fact sheet each year explaining significant changes to the coming year’s changes to Medicare and Medicaid. Some of the things you may find interesting in this document are:
- The Income-Related Monthly Adjustment Amounts (IRMAA) affect roughly only 7 percent of people with Medicare Part B.
- 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. The immunosuppressive drug premium is $97.10 for 2023.
- Individuals who had at least 30 quarters of coverage or were married to someone with at least 30 quarters of coverage may buy into Part A at a reduced monthly premium rate, which will be $278 in 2023, a $4 increase from 2022.
Some in online chatrooms are already balking at the dollar savings being insignificant for Medicare beneficiaries in 2023. Let’s not complain. Be positive. Those savings can go to the membership costs for the American Association of Retired Persons (AARP) or The National Active and Retired Federal Employees Association (NARFE) to assist you in learning about how to leverage your retirement income for additional income savings. Also, don’t forget a donation to The American Red Cross to help others who will appreciate it.
