2017 Medicare Premiums and Deductibles
Medicare just released their 2017 premium and deductible amounts. The deductibles are pretty straightforward; but the premiums, not so much. Let's start with the simple part.
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Deductibles
The Medicare Part A deductible will be increasing from $1,288 to $1,316 in 2017. This deductible is what you're responsible for when you are admitted to the hospital under Original Medicare. Keep in mind though, if you have a Medigap policy, all of them (except Medigap Plan A) will still pay most or all of this deductible for you.
The Medicare Part B deductible will be increasing from $166 to $183 in 2017. If you have a Medigap plan like Plan N or Plan G, you'll be responsible for this slightly larger deductible. If you have a plan that pays this deductible like Plan F or Plan C, you'll likely have a premium increase in the near future as your plan will have to adjust the rate to account for their higher potential expense.
Premiums
The Medicare Part B premium will be increasing from $121.80 to $134 for new Medicare beneficiaries in 2017. So anyone who starts Medicare Part B next year will have to pay this new higher rate. This higher rate will also apply to folks currently on Medicare who are not yet drawing Social Security income. If you're currently on Medicare and are drawing Social Security income, your rate will be different. Here's a breakdown of how much you'll pay in 2017:
- Starting Medicare Part B in 2017 and make under IRMAA limits: $134
- Income exceeds IRMAA limits, no matter when you started Medicare Part B: see chart below
- Currently on Medicare Part B and not drawing Social Security: $134
- Currently on Medicare Part B and are drawing Social Security: amount you're paying now + your Social Security increase (approximately)
Those of you who are currently on Medicare Part B and are drawing Social Security (which is about 70% of the folks on Medicare), you'll get a notice from Social Security of how much your Part B premium will increase to next year.
The basic rule that applies here is that your Social Security income amount can not decrease due to a Medicare Part B premium increase. Social Security announced that the cost of living adjustment for 2017 is 0.3%. This means that Social Security increases are about $5 per month, on average. Because folks currently on Medicare (and not affected by IRMAA) are either paying $104.90 or $121.80 in almost every case now, this entire Social Security "raise" that you're getting will most likely be going toward increasing your Part B premium.
Happy 2017!