Medicare Part B premiums in 2021 will increase $3.90 a month, raising the monthly premium for Part B enrollees to $148.50, the Medicare & Medicare Services announced Friday.
The increase is lower than it was in 2020, which saw a $9.10, or 6.7%, increase in the same year that the cost of living adjustment was 1.6%.
Higher income individuals (those individuals with more than $88,000 of yearly income, or married and filing jointly with annual income of over $176,000) are expected to see their Medicare Part B charge raised to at least $207.90.
The Social Security COLA for 2021 is 1.3%.
In 2019, the Medicare Part B increase was $1.50 a month, or 1.1%, while that year’s COLA was 2.8%.
“The premium hike could have been worse,” said Lisa Swirsky, policy advisor, National Committee to Preserve Social Security and Medicare.
“Unfortunately, the $3.90 premium increase will eat up approximately 20% of the average Social Security beneficiary’s 2021 COLA, which was a meager 1.3%,” Swirsky explained.
Medicare Part B covers physician, outpatient hospital and certain home health services, as well some services not covered by Part A, which pays for in-patient hospital stays, skilled nursing facility care and other home health services.
Part A Changes
The Part A deductible increases by $76 in 2021 to $1,484 from $1,408 in 2020.
“Legislation that was passed earlier restricted the Part B increase to 25% of a preliminary amount,” according to Mary Johnson, policy analyst of the Senior Citizens League.
“This is the first time this approach to restricting the Part B premium has been proactively taken in this manner when the COLA is extremely low, and it will limit the number of people who see their entire COLA consumed by rising Part B premiums,” Johnson explained in an email.
“That should come as much needed relief to millions of beneficiaries,” she said.