“If you’re on Medicare, the cost of your coverage for doctor’s appointments and other outpatient services is about to rise.”
The standard monthly premium will be $144.60 for 2020. That’s $9.10 more than the $135.50 in 2019. The annual deductible for Part B will also rise to $198—up $13 from $185 this year.
Roughly 7% of beneficiaries will pay extra from income-related adjustment amounts, says Investopedia’s recent article, “Here’s how much more you’ll pay for Medicare Part B in 2020.”
The Centers for Medicare and Medicaid Services announced that these increases are because of the rising spending on physician-administered drugs.
“These higher costs have a ripple effect and result in higher Part B premiums and deductible,” CMS said in its announcement.
Some recipients won’t pay the full $144.60 standard premium, because of a “hold harmless” provision that keeps their Part B premiums from going up more than their Social Security cost-of-living adjustment, or COLA. For 2020, the Social Security COLA is 1.6%. In 2019, it was 2.8%.
However, higher-income beneficiaries have paid more for premiums since 2007 through monthly surcharges. It’s estimated that 7% of Medicare’s 61 million or so beneficiaries will pay more, due to those income-adjusted amounts. The program uses your tax return from the prior two years to determine whether you’ll pay monthly surcharges.
For Part A, which covers inpatient hospital, skilled nursing, and some home health-care services, most Medicare beneficiaries don’t pay a premium, because they have enough of a work history of paying into the system to qualify for it premium-free.
However, there are deductibles that go with Part A. The amount you’ll pay when admitted to the hospital will be $1,408 next year. That’s an increase of $44 from $1,364 in 2019. That covers the first 60 days of Medicare-covered inpatient hospital care in a benefit period. For the 61st through 90th days of a hospitalization, beneficiaries will pay $352 per day, an increase of a few dollars from $341 in 2019, and then $704 per day for lifetime reserve days, up from $682 this year.
The premiums and deductibles for Medicare Advantage Plans and for Part D prescription drug plans were already finalized earlier this year and are not impacted by this announcement.
Reference: Investopedia (November 11, 2019) “Here’s how much more you’ll pay for Medicare Part B in 2020”