Life After 50 Expo

Dear Marci,

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Dear Marci,

What will my Medicare costs be in 2016?
– Saul (Decatur, IL)
Dear Saul,

In general, Medicare costs, like most health insurance costs, go up every year. Next year, some costs associated with Medicare Part A, Part B, and Part D will be different.

For Original Medicare Part A, the costs in 2016 will be:

  • Premium:
    • $0 if you’ve worked more than 10 years
    • $226 per month if you’ve worked between 7.5 and 10 years ($224 in 2015)
    • $411 per month if you’ve worked less than 7.5 years ($407 in 2015)
  • Hospital deductible: $1,288 each benefit period($1,260 in 2015)
  • Hospital coinsurance:
    • $322 per day for days 61-90 of each benefit period ($315 in 2015)
    • $644 per day for days 91-150, which are non-renewable lifetime reserve days ($630 in 2015)
  • Skilled nursing facility coinsurance: $161 per day for days 21-100 each benefit period ($157.50 in 2015)

For Original Medicare Part B, the costs in 2016 will be:

  • Premium: Most people will continue to pay $104.90 per month, but some people will pay more.*
  • Deductible: $166/year ($157/year in 2015)

*You will continue to pay $104.90 as the Part B premiumnext year if you are protected by the hold harmless provision. The hold harmless provision applies to you if all of the following apply:

  1. Your Part B premium was taken out of your Social Security check in 2015. This means you received Social Security benefits for November and December of 2015, and
  2. The Medicare Part B premium will be deducted from your Social Security benefits in January 2016, and
  3. You are not subject to an Income-Related Monthly Adjustment Amount (IRMAA) because of a higher income

You will pay $121.80 as a base Part B premium in 2016 if:

  1. You are new to Medicare in 2016.
  2. You are subject to IRMAA (in this case you will pay an additional adjustment amount on top of the premium).
  3. You are enrolled in a Medicare Savings Program (MSP). Note that the MSP will continue to pay for the cost of the premium.
  4. You had an MSP in 2015 but lost it because your income increased or you did not recertify.

Lastly, costs associated with Part D will change in 2016. These changes affect you whether you have a stand-alone Part D plan that works with Original Medicare, or you have Part D coverage through your Medicare Advantage Plan. Your plan may or may not have changed: review the Annual Notice of Change (ANOC) you received from your plan to see any changes in costs or coverage for 2016.

  • Maximum deductible: Up to $360 per year (up to $320 per year in 2015)
  • Amount to get into the Coverage Gap: $3,310 ($2,960 in 2015)
    • You enter the Coverage Gap after you and your plan have paid a combined total of $3,310 on covered drugs since the start of the year.
  • Amount to get out of the Coverage Gap (Donut Hole): $4,850 ($4,700 in 2015)
    • You leave the Coverage Gap and  enter the Catastrophic Coverage phase when you have spent a total of $4,850 in out-of-pocket costs for covered drugs since the start of the year.

These costs can also be found in your Medicare & Youhandbook or on www.medicare.gov.

Note that even if you have a Medicare Advantage Plan, you have to pay the Part A premium (if you don’t have premium-free Part A), and Part B premium. Medicare Advantage Plans cover the same benefits as Original Medicare, but may do so with different costs and restrictions. To learn about how costs may be changing for your Medicare Advantage Plan in 2016, you can contact your plan directly. Your plan also should have sent you an Annual Notice of Change this past fall, outlining changes to coverage and costs for 2016.

Remember, Medicare costs can change each year, and it is important to understand which changes will affect you.

– Marci