Changes in Medicare Premiums

The Centers for Medicare and Medicaid Services recently declared the 2012 premiums for Part B which comprises doctor visits and outpatient care. It holds good for some people as they will see their Medicare Plan Part B premiums decline in the coming year.

All except high-income Medicare Insurance beneficiaries will pay $99.90 per month for Medicare Part B in 2012, which is a $3.50 monthly raise for most people. This is especially for those whose premiums had been frozen at $96.40 for the past two years as there was no Social Security cost-of-living adjustment. But owing to a 3.6% cost-of-living adjustment in 2012, there won’t be a patchwork of different premiums.

A rule termed as hold-harmless provision forbids a person’s Social Security benefits from decreasing from one year to the next. As most retirees have their Medicare Part B premiums subtracted from their monthly Social Security payments, an increase in Medicare Insurance premiums in a year with no cost-of-living adjustment in Social Security benefits would lead to smaller check if not for the hold-harmless provision. But recent enrollees in Medicare Insurance Plan were not protected by the hold-harmless provision in the first year that they signed up, so people who first enrolled in Medicare in 2010 have been paying $110.50 per month for Part B, and those who enrolled in 2011 have been paying $115.40 per month. Their monthly premiums will decrease to $99.90 per month in 2012, too.

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