Is it Still Worth it to Shop for Medicare Plans to Save Money?
The majority of people 65+ in the United States are living on a limited or fixed income. They often struggle to cover the cost of rent, mortgage, groceries, gas and other basic expenses.
The National Council On Aging reports that “Over 15 million older adults aged 65+ are economically insecure, with incomes below 200% of the federal poverty level.”
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Why Seniors Struggle to Make Ends Meet
Some top reasons why seniors struggle to cover monthly expenses include:
- Rising housing and healthcare costs
- Many seniors don’t have a large cash reserve
- Your financial portfolio may be lacking or non-existent
- You don’t have a 401K or pension fund to tap into
- You may wait longer to start collecting social security to maximize your monthly benefit
This may have some older adults nearing or at retirement age looking for a part-time job to help supplement their income. While others decide to start selling off personal belongings, so they can downsize to a smaller home or condo.
But, here’s some good news. Your social security benefits are increasing in 2023. And, thanks to President Biden’s Inflation Reduction Act (IRA) Medicare rates are going down.
TIP: Read our comprehensive report on the 2023 Medicare rate changes.
Biden’s Inflation Reduction Act
The Centers for Medicare and Medicaid Services announced the new 2023 Medicare rates on September 27, 2022.
Medicare premiums are dropping from $170.10 in 2022 down to $164.90 in 2023. This represents a savings of $5.20 per month. Medicare annual deductibles are also seeing a slight drop.
How Biden’s Inflation Reduction Act affects senior healthcare costs:
- Reduces Medicare Part B premiums by $5.20 per month
- Reduces Medicare Part B deductible by $7.00 per year
- Places cap on the amount seniors have to pay for prescription drugs ($2,000 starting in 2025)
- Places a $35 cap on monthly insulin costs for seniors
- Provides free access to all adult-recommended vaccines including shingles and COVID-19
The key point to focus on is that, for the first time in over a decade, you will see a decrease in both your Medicare Part B monthly premiums and your annual Part B deductible.
And, here’s even more great news! In addition to the decrease in Medicare premiums, Social Security benefits are actually going up in 2023.
TIP: Take a look at our 2023 Medicare Premium and Deductible infographic for complete details on why your health insurance costs are going down.
Annual Cost of Living Adjustment
The U.S. Bureau of Labor Statistics recently released its September 2022 inflation report. The Social Security Administration uses this Consumer Price Index to determine the annual Cost of Living Adjustment, AKA COLA.
- Social Security benefits represent around 30% of total elderly income
- 37% of elderly women receive 50% or more of their income from Social Security benefits
- 14% of elderly women receive 90% or more of their income from Social Security benefits
- 42% of elderly men receive 50% or more of their income from Social Security benefits
- 12% of elderly men receive 90% or more of their income from Social Security benefits
On October 13, 2022, the Social Security Administration announced the 2023 cost of living adjustment (COLA). Approximately 65 million people should expect to see a bump of 8.7% in their Social Security benefits starting in January.
So, this may have you asking exactly how much will ssi checks be in 2023. This bump in benefits could work out to up to $150 per month for retirees. That means, on average, you could end up with an extra $1800 in your pocket for 2023.
With the social security cost of living increase and Biden’s decrease in Medicare costs, is it still worth it to shop and compare Medicare plans to help save money?
Inflation Continues to Increase Prices
Unfortunately, due to the high cost of inflation, your financial windfall could quickly be eaten away. Housing, groceries, utilities and other necessities are seeing all-time highs.
According to the Bureau of Labor, the food index has increased by 11.2% during the past year. During this same 12-month period the cost of electricity, fuel oil, gas and other energy services has seen a 19.8% increase. Suddenly, a 8.7% increase in Society Security benefits seems grossly inadequate.
So, what are some other ways you can beat back inflation, reach your monthly budget goals and potentially save money? Once you’ve had a chance to review the new 2023 Medicare rates, you may still decide it’s time to switch plans.
TIP: Now is the perfect time to make a change. The Medicare Annual Enrollment Period runs from October 15th through December 7th. Try our new and improved Medicare plan finder to get more of the benefits you want at a price you can afford.
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Try Our Medicare Plan Finder
Even though Medicare rates are going down, now is not the time to sit back, relax and keep your coverage as-is. Instead of just renewing your current coverage, you still have time to shop and compare plans before the end of AEP.
It’s always a good idea to review your health insurance plan on a yearly basis to make sure your coverage is adequate for your needs. You may be able to find additional benefits or reduce your costs using a handy tool like the Medicare Plan Finder.
Here are the top four reasons why you might want to switch to a different Medicare or Medicare Advantage plan:
- Changing health needs result in the need for a change in coverage
- Better manage your prescription medication costs
- Find preferred healthcare providers and primary care physicians that are in network
- Save money if your current plan’s costs are changing
Whether you are new to Medicare or looking to switch plans, you may want to consult with a Licensed Sales Agent. Our Medicare Benefits Advisors can answer your questions, help you navigate plans and benefits, and assist you with choosing a plan based on your specific needs.
TIP: Call us today at 877-874-1499 or TTY 711. Our call center is open Monday through Sunday from 5 am to 8 pm PST.
Senior Cost of Living News
Did you know the Medicare Benefits blog has even more articles filled with financial news, information and tips?
- How to Save Money with the Medicare Give Back Program
- Common Senior Scams and Tips to Protect Your Identity
- Making Smart Financial Decisions When Navigating Medicare Costs
- Does Medicaid Pay for Cremation Funeral Costs
- Are My Medicare Premiums Going Up in 2023
TIP: Try our Medicare plan finder and get started comparing plans side-by-side today!
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