Social Security announced the anticipated 2% increase in cost of living allowance on Friday and with any increase in SS comes an increase in the cost of Part B.

Since we went a few years without a rise in Part B costs–because SS did not go up–a lot of people have some catching up to do to the tune of $25 per month in extra Part B costs.  About 42 million Medicare beneficiaries are going to take a 23% increase in Part B which will eat up all their COLA increase!  All of your clients were held harmless and haven’t taken an increase in Part B for a few years, have been paying $109 (unless they were high earners, who did take the rate increase each year).  Those people will soon go from paying $109 to $134. OUCH.

Agents are going to have to explain a large rate increase to most of their existing clients.

The standard Part B premium of $134 will not change.  Anyone coming into Medicare Part B for the first time this year, will pay $134.  Your clients who aged in last year will still pay $134.  Paying an additional $25 per person will be a shock to many Medicare beneficiaries. The Social Security increase averages $27 per person–so the increase is eaten up by Part B. This is the largest increase in Part B since 2012. social security cost graph

The Part B DEDUCTIBLE remains unchanged at $183 per year.  This is good news for all the new people on Plan G and Plan N.

If your clients moved from a Plan F this might lead them to believe that the deductible will never change–which is incorrect.  It will edge up each year, but not next year. The Part A deductible went up from $1,316 to $1,340.