The U.S. Department of Health and Human Services recently made an announcement indicating that Medicare Part B premiums in 2012 will be lower than previously projected, and the Part B deductible will decrease by $22. While the Medicare Trustees predicted monthly premiums would be $106.60, premiums will instead be $99.90. Earlier this year, HHS announced that average Medicare Advantage premiums would decrease by 4 percent and premiums paid for Medicare's prescription drug plans would remain virtually unchanged.
As part of the changes made by the Affordable Care Act, people with Medicare also receive free preventive services and a 50 percent discount on covered prescription drugs when they enter the prescription drug "donut hole." This year, 1.8 million people with Medicare have received cheaper prescription drugs, while nearly 20.5 million Medicare beneficiaries have received a free annual wellness visit or other free preventive services like cancer screenings.
Medicare Part B covers physicians' services, outpatient hospital services, certain home health services, durable medical equipment and other items. In 2012, the "standard" Medicare Part B premium will be $99.90. This is a $15.50 decrease over the standard 2011 premium of $115.40 paid by new enrollees and higher income Medicare beneficiaries and by Medicaid on behalf of low-income enrollees.
The majority of people with Medicare have paid $96.40 per month for Part B since 2008, due to a law that freezes Part B premiums in years where beneficiaries do not receive cost-of-living increases in their Social Security checks. In 2012, these people with Medicare will pay the standard Part B premium of $99.90, amounting to a monthly change of $3.50 for most people with Medicare. This increase will be offset for almost all seniors and people with disabilities by the additional income they will receive resulting from the Social Security COLA. For example, the average COLA for retired workers will be about $43 a month, which is greater than the $3.50 premium increase for affected beneficiaries. Additionally, the Medicare Part B deductible will be $140, a decrease of $22 from 2011.
The Centers for Medicare and Medicaid Services also announced modest increases in Medicare Part A monthly premiums, as well as the deductible under Part A. Monthly premiums for Medicare Part A, which pays for inpatient hospitals, skilled nursing facilities and some home health care, are paid by just the 1 percent of beneficiaries who do not otherwise qualify for Medicare. Medicare Part A monthly premiums will be $451 for 2012, just $1 more than 2011. The Part A deductible paid by beneficiaries when admitted as a hospital inpatient will be $1,156 in 2012.
Individuals with higher incomes will be required to pay greater amounts for their Part B premiums as noted in the chart at the top of this page.
NEW: Enrollment period
Medicare uses information from member satisfaction surveys, plans and health care providers to give overall performance star ratings to plans. A plan can get a rating between one and five stars. A 5-star rating is considered excellent. These ratings help you compare plans based on quality and performance.
Effective Dec. 8, 2011, you can switch to a 5-star Medicare prescription drug plan or Advantage Plan at any time during the year.
--The overall plan star ratings are available at www.medicare.gov/find-a-plan.
You can only join a 5-star prescription drug plan if one is available in your area.
In North Dakota, there are two such plans available for 2012.
--You can only use this special enrollment period to switch to a 5-star plan one time each year.
Medicare drug plans are rated on how well they perform in four different categories:
1. Drug plan customer service
2. Member complaints, problems getting services and choosing to leave the plan
3. Member experience with drug plan
4. Drug pricing and patient safety
Their ratings can be excellent, above average, average, below average or poor.
The Centers for Medicare and Medicaid Services became aware of an e-mail that has been spreading across the Internet. The email falsely claims that the Medicare Part B premium will increase to $247 in 2014 as a result of the Patient Protection and Affordable Care Act.
The Part B premium is calculated each year based on health care costs from the previous year. For most individuals, the government pays 75 percent of this calculated premium, while beneficiaries are responsible for 25 percent. The aforementioned email suggests that the PPACA universally and dramatically increases premiums for all Medicare beneficiaries, an indisputably false claim. Because the Part B premium is calculated based on health care costs, any decrease in the growth rate of these overall expenses (which could occur as a result of efforts to decrease fraud, waste and abuse) may result in a similar slower growth rate for Part B premium costs.
David Zimmerman is consumer assistance division director at the North Dakota Insurance Department.