The annual Cost Of Living Adjustment (COLA) for Social Security benefits for this year is only 0.3%. For the average recipient of benefits this is less than $4 a month. For the vast majority of beneficiaries this increase will be completely taken away by the increase in Medicare Part B premiums.
Hold Harmless will keep the Part B in check for those who have been on benefits in the past. The Part B may increase for those new to Medicare, only about 30%. No word yet on the actual premium, just the same scare amounts of between $149 and $175 that we saw last year at this time. Get your Yahoo panic on!!!!
ReplyDeleteHow can it be a "vast" number when 70% will not see a premium increase?
ReplyDeleteThe other 30 percent would see their Part B premiums rise by a much larger amount in 2017. This group, Medicare explains, “consists of new enrollees during the year, enrollees who do not receive Social Security benefit checks, enrollees with high incomes who are subject to the income-related premium adjustment, and dual Medicare-Medicaid beneficiaries (whose premiums are paid by state Medicaid programs.”)
Medicare is required by law to collect about 25 percent of Part B program expenses from Medicare policyholders. Because 70 percent of Medicare beneficiaries are held harmless, the agency must collect all higher beneficiary premiums from the other 30 percent.
Last year, when the COLA for 2016 was set at zero, folks who were not held harmless initially faced 2015 Part B premium increases exceeding 50 percent. Eventually, Congress stepped in and floated a $7.5 billion loan to Medicare. This limited the blow to folks not held harmless, although they still faced a 2016 Part B premium increase of 15 percent. Senior advocacy groups are pushing for similar help this year.
In its annual report, the Medicare trustees said Part B premiums for those not held harmless would need to rise to $149 a month to comply with Medicare’s rules. That projection was based on the trustees’ projection of a 0.2 percent COLA. The slightly larger actual COLA will reduce that $149 premium, but not by much, noted Dan Adcock, director of government relations and policy for the National Committee.
In addition to higher premiums for those not held harmless, the Medicare trustees have projected a big increase in the annual deductible that all Medicare enrollees must pay for Part B covered expenses before their Medicare insurance begins paying claims. It is $166 this year and is projected at $204 next year.
Congress must act to head off large-scale hikes.
When the official 2016 COLA was announced last October, Congress was still in session and could move with relative speed to enact a fix for this year. However, Congress is not scheduled to be back in session until after the elections. This delay will, among other things, create a lot of headaches for the Social Security Administration, which must program any changes into its computers and 2017 benefits process.
Sylvia Burwell, head of the U.S. Department of Health and Human Services, has some discretion to mitigate higher Medicare costs for beneficiaries, Adcock noted. But Congress must act to head off large-scale hikes. --From Philip Moeller PBS Newshour webpage.
I'm not sure there will be a fix this year. Last year's fix was to be paid for by a $3/month surcharge for several years. The purpose of that seems to me to transfer the obligation from high income seniors (and others not covered by the hold harmless provision) onto everyone in future years. So very little of that has been paid, and so if they do another fix, they're pushing more cost onto future recipients, eating up future COLAs.
ReplyDeleteThe law should be changed. The hold harmless provision is fine with me, but they shouldn't push the cost onto recipients who aren't covered.