A new year means new Medicare costs. However, new monthly premiums, deductibles, and cost-sharing aren’t the only Medicare costs to know about in 2023. The recent Inflation Reduction Act will also introduce some new beneficial changes for Medicare beneficiaries starting this year.
So, here’s what to know about Medicare costs in 2023.
Medicare Part A
Most people qualify for premium-free Medicare Part A by having enough U.S. work quarters and paying Medicare taxes over the course of about ten years.
You will have to buy Part A via a monthly premium if you don’t meet the necessary qualifications. The exact premium depends on how many U.S. work quarters you or your spouse have if any.
If you have less than 40 work quarters but more than 30, you will pay $278 each month for Part A in 2023, which is a $4 increase from 2022. If you have less than 30 work quarters, you will have a $506 premium in 2023, a $7 increase from 2022.
Additionally, if you don’t qualify for premium-free Part A and fail to apply for Part A when you are first eligible and don’t have other creditable coverage, you will have a Medicare late enrollment penalty.
The deductible for Part A has also changed. In 2022, the Part A deductible was $1,556, but in 2023 it increased to $1,600. The coinsurances associated with Part A inpatient hospital stays have also increased since 2022.
Medicare Part B
Unlike Part A, everyone must pay a monthly premium for Part B unless they qualify for Medicaid. Most people pay the standard monthly premium of $164.90 in 2023, a decrease from 2022. Find out more here if you need part B: https://boomerbenefits.com/faq/do-i-need-medicare-part-b/
However, if your income level is above a certain limit, you will likely pay more for Part B. The amount you would pay depends on your income level according to your IRS tax return from two years ago.
For example, if you filed an individual tax return and made between $97,000 and $123,000 in 2021, you will have a $230.80 monthly premium for Part B in 2023. Fortunately, you can submit an appeal to Social Security if your income level has fallen below the limit since two years ago.
The annual Part B deductible has also decreased from $233 in 2022 to $226 in 2023.
Medicare Part D
With Part D plans, everyone has a different monthly premium as the plans are run by private insurance carriers. Even so, like Part B, you may pay more in addition to your plan’s premium if your earnings are high enough.
Let’s say you filed a joint tax return with an income level between $306,000 and $366,000 in 2021. In this case, you would pay $50.70 in addition to your Part D plan’s base premium in 2023. Fortunately, like Part B, you can submit an appeal for a redetermination.
Part D Vaccinations
There is some good news regarding Part D. Starting in 2023, many vaccinations that fall under Part D will now be covered at full cost, including the shingles vaccine.
Remember that Part B covers some vaccinations, like pneumonia or hepatitis injections. You’ll want to verify which vaccinations fall under Part B or Part D, so you don’t run into any surprises.
Cap on Insulin
In addition to the now-covered vaccines, new legislation has been rolled out to help cover the cost of insulin. Beginning in 2023, Medicare requires Part D plans to cap the cost of insulin at $35 each month for beneficiaries.
The same will be true for insulin that falls under Part B, starting in July 2023. This will help those taking insulin to keep some extra money in their pockets.
However, keep in mind that this cap only applies to insulin medications, not other diabetic drugs.
One of the last notable changes in 2023 is that drug manufacturers cannot increase the price of medication at a higher rate than inflation. If they do, they will be penalized. This will also help keep costs a bit lower for Medicare beneficiaries.
Customary to each new year, Medicare Part A, B, and D have new monthly premiums or deductibles for the new year. Just remember, these amounts can vary depending on various factors, such as your income level or work history.
On top of the usual changes, 2023 marks the start of new developments associated with the Inflation Reduction Act.