This blog was originally published on Just Care
The 2018 standard monthly Medicare Part B premium,
which covers medical and outpatient care,
remains at $134.00, the same as in 2017, for people with incomes of $85,000 or less. But, only about three in ten people with Medicare have been paying that standard premium. Now, millions of other people who have been paying a lower monthly Medicare Part B premium will see a large increase in their premium because their Social Security benefits are increasing 2 percent.
If you are among the 70 percent or so of people with Medicare who has been paying a premium of $109 (far lower than the standard premium), you may see a $25 a month Medicare premium increase to $134. You and millions of others have had little or no Medicare Part B premium increase these last few years because your Social Security benefits did not increase or increased only a small amount. A “hold harmless” provision in the Social Security Act protected you and others from paying more in Medicare premiums than the increase in your Social Security monthly benefits.
Since Social Security benefits are increasing in 2018,
up 2 percent from last year (in 2017 they were up only 0.3 percent and in 2016 they did not increase at all), Medicare monthly premiums can increase that much for everyone with Medicare who had been protected by the “hold harmless” provision. Put differently, the majority of people who had been paying $109 a month for their Part B Medicare premium will see it rise to $134; their Social Security benefit after the Medicare premium is deducted will be the same as, or only slightly higher than, in 2017.
About three in ten people with Medicare (28 percent) will pay higher Medicare Part B premiums but less than $134 a month. Their monthly premiums will average $130. They will be “held harmless” to the extent that the increase in their Social Security monthly benefits does not cover the difference between the $109 they had been paying and the standard premium of $134.
Some people with incomes of $133,500 and above will also see a Part B premium increase because the income level for paying more than the standard premium contribution for Part B is adjusted downward in 2018. The 2018 Part B premium remains the same for people with incomes over $85,000 and below $133,500. In 2018, people whose modified adjusted gross income from two years ago as reported on their federal tax return–about six percent of the Medicare population–pay:
- $187.50 a month, if their income is above $85,000 and no more than $107,000.
- $267.90 a month, if their income is above $107,000 and no more than $133,500
- $348.30 a month, if their income is above $133,500 and no more than $160,000
- $428.60 a month, if their income is above $160,000
To arrive at the premium amount for married people filing a joint tax return, double the income.
The 2018 Part B annual deductible is the same as in 2017: $183.
People with incomes up to 135 percent of the federal poverty level, ($1,377 in monthly income for an individual and $1,847 for a couple in 2017; these amounts may increase in 2018) are eligible for help paying their premiums through Medicaid or a Medicare Savings Program.
For more than four decades, the Medicare Part B premium (medical insurance) was the same for everyone regardless of income, geography or health status, a quarter of the cost of Part B services. (Medicare Part A, hospital insurance, is premium-free if you have contributed into Social Security for at least 40 quarters.) In 2007, wealthier people with Medicare began paying higher premiums.
Here are 2018 Part A costs:
- The Part A hospital deductible is $1,340 and coinsurance for hospitalizations after day 60 is $335 a day in a benefit period; coinsurance for lifetime reserve days is $670 a day.
- The Part A coinsurance for skilled nursing facility stays after day 20 is $167.50.