Medicare premiums rise, tracking higher Rx and provider costs
Consumers enrolled in Medicare Part B experienced sticker shock this past year, as the journal Medical Economics reports that the monthly Medicare Part B premium rose 14.5% between 2021 and 22.
It was the largest price hike in the program’s history. Several factors played into the large increase including higher provider costs, limitations that had been previously placed on Medicare premium increases early in the pandemic and the uncertainty around pricy new drugs coming onto the market. Those drugs include the new Alzheimer’s drug Aduhelm, which was originally priced at $56,000 per patient per year. Medicare is currently limiting coverage of that drug to patients in clinical trials.
In addition to covering claims, Medicare is required to maintain a funding reserve to keep the program solvent.
But the increase comes as a blow to many seniors who are already struggling to pay for health care. A new survey by MedicarePlans.com found:
- Nearly 1 in 5 will find it “very difficult” to afford health care in 2022
- About half (51%) are reducing discretionary spending on things like travel and entertainment
- And more than a quarter (29%) are cutting back on necessities – including groceries and utility bills – to pay for health care
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