WHAT’S NEW IN MEDICARE?
Part B Premiums Will Rise 3.1%
October 2, 2007
The standard Medicare Part B premium will rise to $96.40 a month in 2008, an increase of $2.90 a month (or 3.1%). This is the smallest since 1999-2000. Medicare Part B covers doctors’ services, outpatient hospital care, X-rays, laboratory services and other diagnostic tests.
More affluent beneficiaries (annual incomes exceeding $82,000 for individuals and $164,000 for couples), will pay higher premiums on a sliding scale, up to a maximum of $238.40 a month for the most affluent ($205,000 individual or $410,000 joint).
The increase in the standard Part B premium was less than many experts had expected, in part because officials decided to correct an accounting error. As a result of the error, money for certain hospice benefits was inadvertently drawn from the Part B trust fund rather than a separate trust fund that pays hospital costs. The money will be paid back in the coming year.
In addition, the premium for 2008 is artificially low because it assumes that Medicare payments to doctors will be cut about 10 percent next year, as required by law. Congress has usually stepped in to avert such cuts, and the cost is passed on to beneficiaries in subsequent years. The chief Medicare actuary said, “The low increase in premiums is good news for 2008,” but he added that it was probably a one-time phenomenon.
The annual deductible for doctors’ visits and other Part B services will be $135, up from $131. For a beneficiary admitted to a hospital, the deductible will be $1,024 next year, up from $992.
Kerry N. Weems, acting administrator of the Centers for Medicare and Medicaid Services, said one factor contributing to the increasing premiums was an increase in payments to private Medicare Advantage plans. Beneficiaries in these plans appear, on average, to be sicker than in the past, Mr. Weems said.
Source: New York Times, October 2, 2007
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- Social Security and Medicare Trustees’ 2007 Report Summary (May 2007)
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