Because of what some call a flaw in the law that punishes wealthier Social Security beneficiaries, millions of seniors could be affected. To be more specific, nearly one third of approximately 50 million elderly Americans who are dependent on Medicare for affordable health insurance could face a significant rise of their premiums in 2016.
Any time the Social Security Administration fails to boost the annual cost of living adjustment, the potential exists for elderly Medicare subscribers to encounter the threat of an eventual increase, which in this case could turn out to be a jump of 52 percent or more next year.
And, unless Congress or Health and Human Services Secretary Sylvia Mathews Burwell do something to prevent it, an estimated 15 million seniors, first-time beneficiaries or those currently claiming dual Medicare and Medicaid coverage stand the possibility of seeing their premiums leap from $104.90 per month to $159.30 for individuals. The analysis takes it a step further with the prediction that higher-income couples would pay multiples of that increase, according to the Center for Retirement Research at Boston.
The growing premium problem associated with Medicare Part B – the premium-based government health insurance program that covers seniors’ doctor visits and other health care providers, as well as out-patient care and durable medical equipment, has not been properly addressed. Reason being – Congress has been concentrating largely on the looming shortfalls in the Social Security Disability Insurance program to give it the attention required to avert the increase in premiums.
On a less negative note – a spokesperson for the Centers on Medicare and Medicaid Services confirmed that – while a premium hike is in the works – about 70 percent of Medicare beneficiaries are not expected to see a premium increase in 2016. However, the news isn’t quite as positive for the remaining 30 percent of beneficiaries who will likely pay a higher premium based on the projection, if the increase is implemented as expected.
Up until now, the proposed rate hike has received relatively little public attention. Therefore, it could catch the bulk of affected seniors somewhat by surprise. According to the Center for Retirement Research study, it could result in a “complicated interaction” between Medicare premiums, which are typically automatically deducted from Social Security benefits, and the rest of Social Security funds that are used for retirement and other non-health care related expenditures.
While proponents of the premium rate hike point out this is only the third time since the automatic cost of living adjustments started in 1975 that Social Security will not increase the cost of living benefit next year. But, simply because the Consumer Price Index used by the government has remained relatively flat – it is of little comfort to seniors who will be directly affected by the increase.
Still, the fact remains that Secretary of HHS Sylvia Mathews Burwell does have some level of authority and discretion as to what the Part B premium will be set at. So, the remote possibility exists that the increase may not be as steep as trustees are projecting.
Just the same, seniors may want to brace themselves should their new premiums give them sticker shock.
Whether it’s Medicare coverage, Medi-Cal or other low-cost health insurance, the Affordable Care Act, also known as Obamacare, mandates you have some form of coverage or you’ll be subject to a penalty for not having health insurance. With open enrollment approaching, why not plan ahead by getting California health insurance quotes today?
Are you going to be affected by the looming Medicare premium increase? How do you feel about it? Feel free to share your thoughts in the comments section below.