What You Need to Know
- The average monthly Social Security benefit for a retired worker is set to go up $92 in January.
- For a Medicare enrollee earning $90,000 per year, monthly Part B premiums will increase $21.60 per month.
- For a married Medicare enrollee who is a joint filer and earns $750,001 per year, the premiums will climb $170.10 per month.
Uncertainty about spending on COVID-19 and a new Alzheimer’s drug, Aduhelm, have pushed Medicare Part B program managers to increase 2022 monthly premiums up at the fastest rate since 2016.
The standard monthly premium for Medicare Part B enrollees will increase 14.5% in 2022, to $170.10, and the deductible will increase 14.8%, to $233, officials at the Centers for Medicare and Medicaid Services announced Friday.
Medicare Part B is the program that pays for physician services and outpatient care for Medicare enrollees.
CMS phases in higher levels of Medicare Part B premiums for individual enrollees who earn $91,000 to $500,000 per year and married joint filers in households that earn $182,000 to $750,000 per year.
What Your Peers Are Reading
The 2022 Medicare Part B premium for the highest-income enrollees will increase to $578.30 per month, from $408.20 per month this year.
Federal law requires Medicare Part B premiums to equal 25% of the estimated Part B costs for enrollees ages 65 and older.
Chiquita Brooks-LaSure, the CMS administrator, said in a comment included in the premium increase announcement that the agency has a commitment to keeping Medicare going.
“The increase in the Part B premium for 2022 is continued evidence that rising drug costs threaten the affordability and sustainability of the Medicare program,” Brooks-LaSure said.
The Social Security COLA
The Medicare Part B program has a “hold harmless” mechanism that can reduce or eliminate the impact of premium increases for low-income and modest-income enrollees when Social Security cost-of-living adjustments, or COLAs, are small.
In 2022, the 5.9% COLA may keep the hold harmless mechanism from helping many enrollees, because the COLA is on track to increase the monthly Social Security benefit by $92 per month, to $1,657, for the average retired worker.