Medicare premiums will drop in 2023
Medicare Part A and B premiums will drop in 2023, marking the first decrease in a decade.
The Biden administration announced 2023 premium rates for Medicare Parts A and B this week, as well as the 2023 Medicare Part D income-related monthly adjustment amounts.
Medicare Part B, which covers physician services, outpatient hospital services, certain home health services, durable medical equipment and some other medical services not covered in Part A, will see a drop in premiums to $164.90 in 2023. That’s a decrease of $5.20 from $170.10 in 2022. Part B premiums, deductibles and coinsurance are determined by the Social Security Act. The annual deductible for Medicare Part B is $226 in 2023, down $7 from $233 in 2022. The immunosuppressive drug premium for those who are 36 months post kidney transplant, and therefore are no longer eligible for full Medicare coverage, is $97.10 in 2023 for those who elect for Part B coverage. CMS also updated 2023 Part B premiums for the roughly 7% of beneficiaries whose premiums are based on their income.
Part of the reason Part B premiums are going down is due to a contingency margin in 2022 premiums to cover expected spending for a new drug, aducanumab (Aduhelm). Lower spending on the drug, as well as other Part B items and services, led to larger reserves in the Part B account of the Supplementary Medical Insurance Trust Fund. The fund can be used to limit future premium increases, and the 2023 decrease aligns with recommendations from the Centers for Medicare and Medicaid Services (CMS) to pass along savings to Part B beneficiaries.
Within Part A, which covers inpatient hospital, skilled nursing facility, hospice, inpatient rehabilitation and some home health care services, about 99% of beneficiaries do not have a premium, as they have at least 40 quarters of Medicare-covered employment. Those who do have to pay a premium pay based on a scale of how many quarters of Medicare-care covered employment they have. In 2023, individuals who had at least 30 quarters of coverage or were married to someone with at least 30 quarters of coverage may buy into Part A at a monthly premium rate of $278 in 2023, a $4 increase from 2022. Uninsured aged individuals who have less than 30 quarters of coverage and certain individuals with disabilities who have exhausted other entitlement will pay the full premium––$506 a month in 2023––a $7 increase from 2022.
The Medicare Part A inpatient hospital deductible, which covers beneficiaries’ share of costs for the first 60 days of Medicare-covered inpatient hospital care in a benefit period, will be $1,600 in 2023, an increase of $44 from $1,556 in 2022. In addition, beneficiaries must pay a coinsurance amount of $400 per day for the 61st through 90th day of a hospitalization ($389 in 2022) in a benefit period and $800 per day for lifetime reserve days ($778 in 2022).
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."