Dive Brief:
- CMS has released its 2017 premiums for Medicare's Part A and Part B programs, which cover inpatient hospital, and physician and outpatient hospital services, respectively.
- In light of the Social Security Administration's October announcement that the cost-of-living adjustment (COLA) for Social Security benefits will be a low 0.3%, CMS said a “hold harmless” provision protects about 70% of beneficiaries from significant Part B premium increases. They will see their average 2017 premium rise from $104.90, where it has been for four years, to $109.00.
- The other 30% of beneficiaries will see a 10% increase in their Part B premiums, from $121.80 to $134.00.
Dive Insight:
The “hold harmless” provision is a stumbling block for CMS that forces 30% of beneficiaries to cover the bulk in Medicare cost increases for the 70% who are protected.
Those who are not protected include those not receiving Social Security benefits, those enrolling in Part B for the first time in 2017, those who are directly billed for their Part B premium, those dually eligible for Medicaid and getting their premium paid by state Medicaid agencies, and those paying an income-related premium.
The limitations set by COLA decisions and the "hold harmless" provision have had Medicare in a stranglehold that has raised controversy in the past. In 2015, officials floated a Part B premium increase of as much as 52% for 2016, though that increase was mitigated through the Bipartisan Budget Act of 2015.
CMS also released the annual deductible for all Medicare Part B beneficiaries, which will be $183 in 2017, up from $166 in 2016. For Medicare Part A, about 99% of beneficiaries don't pay a premium, CMS noted, and the inpatient hospital deductible will be $1,316 per benefit period in 2017, up from $1,288 in 2016.