Medicare Price Increase 2024: How Will it Affect Seniors?
Like many seniors, the economy and inflation may be on your mind this time of year. That worry likely extends to the upcoming Medicare price increase in 2024. Any change to monthly expenses can have a ripple effect on fixed incomes. So, you’re probably wondering, how will these changes affect you?
How the Medicare price increase affects seniors
Each year, the Social Security Administration (SSA) evaluates various factors to determine the annual cost of the Medicare program. Based on this assessment, SSA adjusts premiums and deductibles. In terms of Medicare costs in 2024, you can expect a few changes.
Medicare price increase for Part A
Although most Medicare beneficiaries don’t have Part A premiums, you should be aware these plan premiums are rising in 2024. If you do have a Part A plan, prepare for
- inpatient hospital deductibles to increase by $32,
- daily hospital coinsurance for days 61 through 90 to increase by $8,
- daily hospital coinsurance for lifetime reserve days to increase by $16, and
- skilled nursing facility daily coinsurance (days 21 through 100) to increase by $4.
These price adjustments, while nominal, can be important financial considerations for you.
Medicare price increase for Part B
Medicare costs in 2024 for Part B beneficiaries will go up, too. If you have a Part B plan, premiums will increase from $164.90 to $174.70, costing about $10 more than last year. Deductibles are also set to increase this year. In 2024, the Medicare Part B deductible will be $240, $14 more than in 2023.
But, since Medicare Part B costs are income-based, these changes only apply to seniors making less than $103,000 annually. For couples filing jointly, this cap is set at $206,000. This year, though, the income-related monthly adjustments will go up as well. This table, provided by the Centers for Medicare and Medicaid Services (CMS), allows you to calculate whether or not you’ll be affected.
Medicare price decrease for Part D
You read that correctly! For most seniors, the Medicare prescription drug coverage price will decrease in 2024. The average monthly Part D premium is expected to drop by $0.99 in 2024. While this amount might not seem like much, every little bit helps.
At the same time, some beneficiaries might notice higher Medicare Part D costs in 2024. Just like Part B coverage, Part D is income-based. When you’re on a Medicare Advantage Plan, you pay both a “Part B Premium” to CMS and another monthly premium to your plan. But if you have a Medicare Part D plan, you don’t pay a premium to CMS, just to the plan. Of course, if you exceed the income cap, you’ll have to pay additional income-related monthly adjusted amount (IRMAA) fees for Plans B and D.
In 2024, if your income is greater than $103,000 filing individually or $206,000 married filing jointly, you may have income-related adjustments ranging between $12.90 and $81 per month. If you qualify, Social Security will contact you and take the difference from your Social Security check.
Again, if your income is less than the annual income caps mentioned above, you don’t need to worry about these adjustments!
Why are Medicare costs in 2024 increasing?
According to a press release from CMS, “The increase in the 2024 [Medicare] Part B standard premium and deductible is mainly due to projected increases in health care spending and, to a lesser degree, the remedy for the 340B-acquired drug payment policy for the 2018-2022 period under the Hospital Outpatient Prospective Payment System.”
But what does that really mean? There are a few points to observe.
Overall, the government expects healthcare spending for seniors to increase in 2024. One of the reasons for this rise is a new Alzheimer’s drug, called Leqembi, which will be entering the market this year. CMS expects many beneficiaries to take advantage of this drug and, as a result, anticipates elevated costs.
The 2022 Inflation Reduction Act (IRA) takes credit for much of the Part D decrease this year. The IRA includes provisions to cap annual out-of-pocket costs, eliminate cost-sharing for certain vaccines, and limit cost-sharing for insulin products in 2024.
If you need help navigating the Medicare price increase this year, My Senior Health Plan’s Medicare consulting services are here to help. For more information, or to talk to someone who can help, get in touch with us at 877.255.6273.
image credit: shutterstock/d.ee_angelo
