- September 27, 2022
- By InvestmentNews
Individuals enrolled in Medicare Part B, which covers doctor visits and other outpatient services, will pay a monthly premium of $164.90 in 2023, which is down $5.20 from $170.10 in 2022.
In 2022, the Medicare Part B premium jumped $21.60, a 15% increase that was one of the largest in Medicare’s history, in part because CMS was required to accumulate reserves against the cost of the newly approved Alzheimer’s drug, Aduhelm.
While Aduhelm had been approved by the Food and Drug Administration, the approval was controversial, as was the drug’s initial price tag, at $56,000 per year. But last December, Aduhelm’s manufacturer, Biogen, said it would cut the drug’s cost by half, to $28,000 a year, as of Jan. 1.
In the wake of the price cut, CMS reassessed the 2022 Part B premium increase. It decided not to alter the 2022 premium in mid-year but said the lower price tag on Aduhelm was likely to mean a lower Medicare Part B premium for 2023.
Higher-income Medicare beneficiaries will also pay a little less next year. In 2023, individuals with modified adjusted gross income of $97,000 or more and married couples with MAGIs of $194,000 or more will pay additional surcharges ranging from an extra $65.90 per month to an extra $395.60 per month on top of the standard Part B premium. In 2023, those IRMAA surcharges ranged from $68.00 to $408.20 per month.
Married couples where both spouses are enrolled in Medicare pay twice as much.
Medicare Part B premiums and IRMAA surcharges are usually deducted directly from monthly Social Security benefits, although people who aren’t yet claiming Social Security are billed directly by Medicare. The cuts in the Part B premium and IRMAA surcharges come as the spike in U.S. inflation is expected to result in a large cost-of-living adjustment to Social Security benefits in 2023.
Earlier this month, Mary Johnson, Social Security analyst for the Senior Citizens League, projected Social Security benefits could increase by 8.7% next year, based on the August consumer price index.
The Social Security Administration is expected to announce the official cost-of-living adjustment for 2023 on Oct. 13, after the government releases September CPI. The COLA is based on the increase in the average CPI for the third quarter — July, August and September — over the previous year’s third quarter.