Americans will be paying less in monthly premiums for Medicare’s Part B plan in 2023 — the first decrease in a decade.
This drop means most people on Medicare will pay $164.90 a month for Part B coverage, a savings of $5.20, AP News reported. The annual deductible will decrease $7 to $226. Seniors will be paying a lower out-of-pocket amount before Medicare kicks in. CBS News noted that this results in $84 less in annual out-of-pocket spending from seniors.
According to CBS, this decrease is due to Alzheimer’s drug Aduhelm, which also increased Part B premiums for 2022. Medicare has set strict limitations on the drug’s use, cutting the cost of the medication in half. Medicare paid less for the drug this year, allowing the agency to lower the premiums for Part B.
This decrease also comes after a year of record high inflation, which was up 8.3% in August, according to data from the Bureau of Labor Statistics.
Beneficiaries may also see additional savings next year with a high cost-of-living increase in Social Security benefits. AP News reported that an increase of 9% or 10% could help put hundreds of dollars back in the pockets of millions of people. The Social Security Administration will announce its 2023 cost-of-living adjustment in October.
“That’s something we may never see again in the rest of our lives,” said Mary Johnson, the Social Security and Medicare policy analyst for The Senior Citizens League, as reported by AP News. “That can really be used to pay off credit cards, to restock pantries that have gotten low because people can’t afford to buy as much today as they did a year ago and do some long-postponed repairs to homes and cars.”
More From GOBankingRates