Tens of millions of Americans rely upon Medicare for their primary health insurance company. Most of these beneficiaries don't have to pay anything for Part A, but do pay a premium for Part B. According to an article in Time called "Why Medicare Premiums May Jump 50%," the rules say that the government has to recoup 25 percent of their expenses through these premiums. Typically, cost increases get spread around to most beneficiaries, so almost everybody has modest Part B premium increases from time to time. However, 2016 may be very different.
Why is the Potential Part B Premium so High for Some People in 2016?
In 2016, a small number of beneficiaries may get hit with a rather large increase. At the same time, the majority won't have an increase at all. This is because there is something called a "hold harmless" provision in the law. This rule doesn't allow premium increases for people who have the standard premiums taken out of their social security in years when there has been no cost-of-living, or COLA, adjustment. Because inflation been so flat this year, there may not be a COLA. This means that the only people who might have to pay more are those who don't have their Part B premium withdrawn from their social security checks.
If there is no COLA, most beneficiaries will still pay the standard $104.90 a month for Part B. People with higher incomes may pay more. Those with low incomes may pay somewhat less. Still, the government has to obtain that 25 percent increase from somebody.
Who Could Pay More in 2016?
- The hold-harmless provision doesn't apply to people with higher incomes who don't pay the standard rate.
- It also won't apply to people who are new to Medicare.
- Finally, some people quality for Medicare but don't yet receive social security, so they are also vulnerable to the increase.
What this means is that the majority of Medicare recipients won't suffer from a Part B increase, but a minority could have to pay quite a bit more in 2016. For example, some people choose to take Medicare health insurance but delay social security benefits. This situation may encourage more of these folks to stop delaying social security, so they can enjoy the hold harmless protection that most beneficiaries do. Others may want to speak with a financial planner or attorney to find other ways to avoid the increase.
We’ve got you covered. Call Sun Coast Legacy Advisors P.L. at (888) 455-5799 for more information on Florida Medicare supplement insurance.