Making Health Insurance Make Sense

By Mary Loftis, Extension Assistant

As a Senior Health Insurance Information Program (SHIIP) Counselor, I received this information from the Centers for Medicare and Medicaid Services (CMS) just last week. At the time of our SHIIP training in early October, CMS had not announced the new coverage and deductible prices or plan changes.

Here are “Answers to Some of the Most Commonly Asked Questions about Medicare” from CMS.

Q:    Can you explain what the Part A and Part B premiums will be in 2016?

A:      For most beneficiaries, the answer is simple:  they will be the same in 2016 as they were in 2015.  That’s because there will be no Social Security cost-of-living increase in 2016 benefits.  As a result, most people will pay the same premium for Part B, as long as the premium is withheld from their Social Security benefit check. That’s about 70% of all people on Medicare. Also, since 99% of beneficiaries get Part A Medicare coverage without a premium (since they or their spouse have at least 40 calendar quarters of Medicare-covered employment during their lives), that won’t change, either.

Q:  What about people who don’t qualify for this?  How much will they pay?

A:  Some beneficiaries will not qualify for the rule that keeps their Part B premium unchanged.  These include:  people who do not yet collect Social Security benefits; people who will become  new beneficiaries in 2016;  people who have their Part B premiums paid through a different process, such as Federal retirees; and people who pay an additional premium already, because of their income.  People on both Medicare and Medicaid, whose premiums are paid by their States, are also ineligible for unchanged premiums.  All beneficiaries in those categories will see an increase in their Part B premiums to $121.80 per month (higher for those with income-related surcharges).  These groups together account for about 30% of Medicare’s 52 million beneficiaries.

Q:  Are Part A and B deductibles going up, too?  Will some people be exempt from those increases?

A:  The Part A deductible for an inpatient hospital admission is going up from $1,260 in 2015 to $1,288 in 2016.  Co-insurance for stays beyond 60 days, and for stays in a skilled nursing facility following an inpatient admission will also increase, by a modest 2.2% in 2016.

The Part B deductible is increasing from $147 in 2015 to $166 in 2016.  This is the first increase in the Part B deductible in 3 years.  These increases will apply to all beneficiaries; those exempt from premium increases will still be subject to the new deductible and co-pay amounts in 2016.

For more information about 2016 premiums and deductibles, you can go to www.medicare.gov, or call Medicare any time of day or night, at 1-800-MEDICARE [1-800-633-4227].