Each year, the Medicare out-of-pocket costs are subject to increases to reflect the cost of living. We have had a lot of inflation in 2021, and this resulted in the largest Social Security cost of living adjustment (COLA) in many years. The COLA will be 5.9 percent, and we addressed this in a recent post.
On the other side of the coin, inflation is going to trigger increases in the Medicare out-of-pocket expenses, and we will look at them here.
Part B Premiums
Medicare Part B is the portion of the program that pays for treatments that are administered by doctors and other approved health care professionals. You have to pay a monthly premium for this coverage, and most people have been paying $148.50 this year.
Next year, the figure will rise to $170.10 a month. If you are drawing a Social Security benefit, it will be automatically deducted from your direct deposit.
This will be the premium for individual filers that report $91,000 or less on their income tax returns. If you make more than this amount but less than $114,000, the monthly rate is $238.10. It goes up to $340.20 for the next bracket that maxes out at $142,000.
From there it rises to $442.30 for people that claim more than $142,000 up to $170,000. The next level goes up to $500,000 in earnings, and it is $544.30 a month. People that make more than this will pay a monthly premium of $578.30.
There is a modest $203 deductible that is going up to $233 next year. This portion of the program will pay for 80 percent of covered expenses, and you have to pay the rest of it out of your pocket.
Part A Deductible and Coinsurance
You do not pay premiums for Part A, which is the hospitalization coverage. There is a $1484 per benefit period deductible in 2021, and it will rise to $1556 when the clock strikes midnight on December 31st.
The first 60 days are covered without any coinsurance requirement. If you are in the hospital for 61 to 90 days, the coinsurance rate will be $389 in 2022. For stays that exceed 90 days, you will pay $778 a day. These are lifetime reserve days, and they are limited to 60.
Medicare Part D
This is the prescription drug component, and you can choose from many different plans that are offered. The premiums, deductibles, and coinsurance will vary depending on plan that you select.
Medicare Part C
Part C give you the ability to use your eligibility to obtain a Medicare Advantage Plan from a private insurer. This will bundle the different types of coverage, and there are thousands of different plans, so the costs will vary depending on the extent of the coverage.
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