December 4, 2022

This Article reprinted with permission of nerdwallet,

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While inflation is driving up prices for almost everything, Medicare is about to get less expensive. According to a September 27 announcement by Medicare and Medicaid Services, or CMS, Medicare Part B premiums will go down for 2023.

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monthly premium for Medicare Part B That would drop to $164.90 in 2023 for most beneficiaries. (A small number of high-income beneficiaries pay higher premiums). This is a reduction of $5.20 per month from the $170.10 premium in 2022.

The Medicare Part B deductible has also decreased from $233 in 2022 to $226 in 2023.

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The reduction in premiums applies to almost everyone with Medicare because both original medicine (Part A and Part B) Beneficiaries and Medicare Advantage (Part C) Members pay Part B premiums.

Why did the price drop in 2023?

The lower premium for 2023 comes exactly a year after a major price hike. Premiums rose $21.60 from 2021 to 2022 — the largest price increase ever for Medicare Part B premiums.

The same drug is a major factor in both the 2022 price rise and the 2023 price drop: EduHelm, a very expensive treatment for Alzheimer’s disease.

In a November 2021 fact sheet, CMS cited potential Medicare coverage for Aduhelm as one reason for the large Part B price increase for 2022. Even though CMS had not yet determined whether Medicare would cover Aduhelm, CMS said that “we should plan for it. The potential for coverage for this high-cost Alzheimer’s drug, which may be covered, That could result in significantly higher expenditures for the Medicare program.”

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Reading: Medicare Finance and Alzheimer’s Medicine Aduhelm. saga of

That possibility did not come true. In April 2022, CMS announced that Medicare would cover Aduhelm only in the context of certain government-approved clinical trials. As a result, Department of Health and Human Services Secretary Javier Becerra announced in May that “we have determined that we can put cost-savings directly into the pockets of those enrolled in Medicare in 2023.”

What this means for Medicare beneficiaries

According to a NerdWallet analysis of historical Medicare premium data, 2023 will only be the fourth time Medicare Part B premiums have decreased year over year. More than a decade has passed since the last fall in 2012.

Medicare Part B premiums for 2023 are down about 3% compared to 2022 — a smaller percentage than the previous decrease.

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However, according to an analysis by The Senior Citizens League, a non-profit advocacy group, Social Security payments could increase by about 9% after the 2023 cost-of-life adjustment. Medicare Part B premiums, which are often deducted from Social Security, won’t eat up any of that increase because they’ll be lower, leaving beneficiaries with more money to cover other costs that increase as a result of inflation.

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Alex Rosenberg writes for NerdWallet. Email: [email protected] Twitter: @AlexProsenberg.