2016 Medicare Premiums Announced

The Centers for Medicare and Medicaid Services (CMS) has announced Part A and B deductibles and premiums for 2016.

Many beneficiaries with Medicare Part B will not see their monthly premiums increase above last year’s $104.90, related to a previous announcement by the Social Security Administration that there would be no social security cost of living increase for the coming year.  Other beneficiaries, including those who do not receive social security benefits; those who initially enroll in Medicare Part B in 2016; those considered “dual eligible beneficiaries” who have their premiums paid by Medicaid; and those who pay an additional income-related premium are not subject to the so-called “hold harmless” provision, and will see their premiums increase to $121.80.  According to CMS, these groups account for about 30 percent of the approximately 52 million Medicare Part B beneficiaries. 

Since 2007, those with higher incomes have paid greater Part B monthly premiums.  Less than five percent of beneficiaries are affected by this income-related monthly adjustment amount (IRMAA).  The 2016 monthly premium increases for those in higher income brackets are: 

• $170.50, up from $146.90 in 2015 for
  • Individuals with annual incomes between $85,000 and $107,000 and
  • Married couples with annual incomes between $170,000 and $214,000  
   
• $243.60, up from $209.80 in 2015 for
  • Individuals with annual incomes between $107,000 and $160,000 and 
  • Married couples with annual incomes between $214,000 and $320,000  
   
• $316.70, up from $272.70 in 2015 for
  • Individuals with annual incomes between $160,000 and $214,000 and 
  • Married couples with annual incomes between $320,000 and $428,000  
   
• $389.80, up from $335.70 in 2015 for
  • Individuals with annual incomes of $214,000 or more and 
  • Married couples with annual incomes of $428,000 or more   
   

The annual deductible for Part B beneficiaries will increase from $147 in 2015 to $166 for 2016.  

Medicare Part A covers primarily inpatient hospital, some home health care and skilled nursing facility charges.  Those beneficiaries who have at least 40 quarters of Medicare-covered employment are considered “premium-free Part A” and not required to pay the Part A deductible.  CMS estimates about 99 percent of beneficiaries fall into this category.  For those who are required to pay, the premium will increase to a maximum of $411 per month, up from a $407 maximum in 2015.

The Part A deductible is also increasing from $1,260 in 2015 to $1,288 in 2016. Other Part A costs include: 

• Co-payment for hospital stay days 61-90: $322 per day, up from $315
• Co-payment for hospital stay days 91 and beyond: $644 per day , up from $630
• Skilled nursing facility co-payment, days 21-100: $161 per day , up from $157.50 

For additional information, visit the CMS website.