Medicare Premium Hike Looms, Congress Takes No Action
Written by Editor   
Wednesday, October 28, 2015 03:01 PM

Medicare Part B premiums will be increasing by as much as half for a large group of beneficiaries in 2016 unless Congress acts before the end of the year -- which is far from certain.

The projected increase -- from an average of about $105 per month to $159.30 -- occurs because in 2016, there will be no cost-of-living increase for Social Security recipients. People who get their Medicare premiums deducted from their Social Security checks -- about two-thirds of Medicare beneficiaries -- are protected by law from having their Medicare premiums increase any more than their Social Security benefits increase, so they won't have an increase in their Medicare premiums.

But the rest of the Medicare beneficiaries -- about one-third of them, or about 8 million people -- will then have to pick up the share for all beneficiaries when it comes to paying for the increasing cost of the Medicare program, hence the big increase in their premiums. This group includes mainly higher-income beneficiaries as well as "dual eligibles" -- those who qualify for both Medicare and Medicaid and whose premiums are paid for by the Medicaid program.

One group that wants something done about the hike is state Medicaid directors, whose budgets will be hard hit if the premium increase goes through. The increase "is our number one issue right now,” the executive director of the National Association of State Medicaid Directors said in an email.