Though the standard monthly premium for Medicare Part B will remain the same in 2018 as it was this year, many enrollees will still see their premiums rise.
The reason, according to a recently released fact sheet from the Centers for Medicare & Medicaid Services, is a “hold harmless” provision that requires any increase in Part B premiums to be lower than the increase in their Social Security benefits.
Because Social Security benefits will rise 2% next year after several years of zero or minimal cost-of-living increases, those enrollees who were subject to the hold harmless provision in 2016 and 2017 will see their monthly Part B premiums jump from an average of $109 to $134.
The hold harmless provision applies to the 70% of all Medicare Part B enrollees who have their premiums automatically deducted from their Social Security checks. But the premium hike won’t affect all of them. CMS says 42% of all Part B enrollees who will be held harmless in 2018 must pay the full monthly premium of $134.
Twenty-eight percent of all Part B enrollees who are subject to the hold harmless provision in 2018 will pay less than the full monthly premium of $134, because the increase in their Social Security benefit will not be large enough to cover the full Part B premium increase.
Meanwhile, the annual deductible for all Medicare Part B beneficiaries will be $183 in 2018—unchanged from 2017.
In its announcement detailing Part B rates, CMS pointed out that the average monthly premium for Medicare Advantage plans is expected to decrease next year, adding that 77% of Medicare Advantage enrollees remaining in their current plan will have the same or a lower premium for 2018.
“We encourage Medicare beneficiaries to explore their options to make an informed choice between original Medicare and Medicare Advantage before open enrollment ends on December 7,” CMS Administrator Seema Verma said.
CMS has already made its Medicare Advantage-friendly stance clear in a final rule that would allow MA plans to be included in advanced alternative payment models. Another recently proposed rule would relax regulations on MA plans—which the insurance industry’s major trade group applauded.