Inflation is low and medical costs have gone up only moderately. So why is the Wall Street Journal predicting soaring cost increases for millions of seniors?
Soaring Medicare Costs for 2016?
A review of the facts may clarify the issue.
Most Medicare premiums linked to Social Security benefits
By federal law, Medicare premiums are linked to the dollar amount of Social Security benefits received by 70 percent of all Medicare beneficiaries. Due to low inflation, these benefits aren’t scheduled to go up in 2016. This means that any increase in Medicare costs will have to be paid by the 30 percent of Medicare beneficiaries whose premiums are not linked to Social Security payments.
Medicare premiums not linked to Social Security
The 30 percent of Medicare beneficiaries that would have to absorb the higher premiums consists of three groups: 1) high-income beneficiaries who are already required to pay higher premiums; 2) beneficiaries new to Medicare as of 2016; 3) low-income people eligible for Medicare and Medicaid (but their premiums are paid by state Medicaid programs).
As of now
Unless you’re in the high-income group of Medicare beneficiaries or new to Medicare in 2016, you don’t have to worry about potentially “soaring costs” for your Medicare. In any case, no hard and fast decisions have been made. Congress and the President are still considering various options.
October 15: Open Medicare enrollment starts
Time to reconsider your Medicare choices for 2016. Before you consider any changes, we recommend that you review the 2015 summary of options.
As we learn more about specific changes in 2016, we will keep you informed.
For more information:
• medicalwebtimes.com - medicare rates to soar
• wsj.com - medicare rates
• motherjones.com - medicare premiums
• nytimes.com - medicare, social security and cost of living
• asknelly.com - medicare 2015