Congressional Budget Deal Prevents Huge Increase In Medicare 2016-2017 Premiums

16 million Medicare beneficiaries were facing a 52 percent increase next year in their premiums for Medicare Part B, but the Budget Deal worked out by the White House and Congress, held that to a 15 percent increase.

Most beneficiaries have a “hold harmless” provision, which ensures that Social Security will not be reduced when Medicare Part B premiums increase.

If inflation remains flat and the Social Security cost-of-living adjustment is zero, then we have a repeat of the fix in 2017 with most Medicare beneficiaries paying the same $104.90 monthly premium for another year. But that is not likely. Instead, we could see consumer prices rise somewhat even with continuing weakness in the economy. If that happens, the “hold harmless” provision will again impose very large increases in premiums for millions of seniors.

In 2017, 36 million beneficiaries protected by “hold harmless” will pay $118.90 a month, the 16 million who are not protected under “hold harmless” will pay $155.70 a month.