CMS Releases 2022 Medicare Part B Premium and Deductible Rates
Every year, the Centers for Medicare and Medicaid Services (CMS) releases new rates for Medicare Part B premiums and deductibles, with costs gradually increasing over the past decade.
In 2021, the standard Part B premium amount was $148.50. For 2022, that number has been raised to $170.10 - a 14.5% increase.
Medicare Part B premiums cover physician visits and outpatient medical service and are usually taken out of Social Security benefit payments.
In October, the Social Security Administration (SSA)announced that its annual cost-of-living adjustment (COLA) would be a historically high 5.9%. Back in 1982, the SSA increased benefits by 7.4%. This year’s COLA is the biggest jump since that date — and it’s significant, considering 2020’s boost was only 1.3%.
With this increase, the average retirement benefit will go up by about $92 per month by January, offsetting some of the increase to the Part B premium.
So, with the new $170.10 premium and a $92 COLA by the SSA, the average Medicare Part B beneficiary also receiving Social Security can expect to spend an additional $78.10 for their premium in 2022.
As for Part B’s deductible, for 2021, beneficiaries have been paying $203 before their 20% coinsurance kicks in. For 2022, that amount has increased to $233.
Factors That Could Raise Your Part B Premium
While all Medicare Part B beneficiaries will have the same deductible, some will pay a different amount for their premium. Most Medicare Part B beneficiaries will pay the standard premium of $170.10, but there are a couple factors that could cause you to pay a bit more.
If your modified adjusted gross income (MAGI) is over a certain amount, you’ll pay an extra charge. Your MAGI is determined by the income reported on your IRS tax return from two years ago. So, your yearly income for 2020 will affect the Medicare Part B premium you’ll pay in 2022.
Once you’ve pinpointed your MAGI from 2020, you’ll pay the standard premium amount plus an Income Related Monthly Adjustment Amount (IRMAA) based on that MAGI.
Here’s a rundown of all the possible scenarios that could cause you to pay a higher premium:
How the Medicare Hold Harmless Provision Protects Most Beneficiaries
However, there’s yet another factor that could affect your Medicare Part B premium. The Medicare hold harmless provision protects beneficiaries from having their Social Security benefit reduced by an increase in the Part B premium if:
You’ll receive Social Security benefits for the final two months of the current year (2021).
Your Medicare Part B premium will be or was taken out of your Social Security benefits from November 2021 through January 2022.
You don’t already pay a higher premium due to the IRMAA in the table above.
And you won’t receive a COLA big enough to cover the full premium.
That being said, the majority of beneficiaries are likely to have their entire Part B premium covered by 2022’s high 5.9% COLA. If that is the case, you won’t be “held harmless,” and your premium would increase the full amount to $170.10.
The hold harmless provision will NOT protect Medicare Part B beneficiaries if they’re new to Medicare in 2022, as they will not have been enrolled within enough time to qualify.
Enroll in Medicare Part B today to take full advantage of as many benefits as possible.
LEGAL DISCLAIMER: The above is meant to be strictly educational and not intended to provide medical advice or solicit the sales of an insurance product or service of any kind.