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What's in Store for Medicare's Part B Premiums and Deductible in 2016, and Why?

Appendix A

Table 1: Historical and Projected Social Security Cost-of-Living Adjustment, Average Monthly Social Security Benefits, and Medicare Part B and Part D Premiums and Deductibles, 1975-2024
Year Social Security Cost-of-Living Adjustment1 Average Monthly Social Security Benefit2 Monthly
Part B Premium3
Part B Premium Increase (%) Part B Deductible3 Part B Deductible Increase (%)
1975 8.0% $212.07 $6.70 $60
1976 6.4% $232.75 $6.70 0% $60 0%
1977 5.9% $254.33 $7.20 7% $60 0%
1978 6.5% $277.89 $7.70 7% $60 0%
1979 9.9% $314.47 $8.20 6% $60 0%
1980 14.3% $359.25 $8.70 6% $60 0%
1981 11.2% $396.28 $9.60 10% $60 0%
1982 7.4% $410.95 $11.00 15% $75 25%
1983 3.5% $410.23 $12.20 11% $75 0%
1984 3.5% $429.46 $14.60 20% $75 0%
1985 3.1% $443.09 $15.50 6% $75 0%
1986 1.3% $456.93 $15.50 0% $75 0%
1987 4.2% $484.01 $17.90 15% $75 0%
1988 4.0% $504.88 $24.80 39% $75 0%
1989 4.7% $538.70 $31.90 29% $75 0%
1990 5.4% $559.32 $28.60 -10% $75 0%
1991 3.7% $592.77 $29.90 5% $100 33%
1992 3.0% $620.66 $31.80 6% $100 0%
1993 2.6% $645.91 $36.60 15% $100 0%
1994 2.8% $665.67 $41.10 12% $100 0%
1995 2.6% $688.37 $46.10 12% $100 0%
1996 2.9% $708.70 $42.50 -8% $100 0%
1997 2.1% $734.53 $43.80 3% $100 0%
1998 1.3% $754.23 $43.80 0% $100 0%
1999 2.5% $791.18 $45.50 4% $100 0%
2000 3.5% $842.84 $45.50 0% $100 0%
2001 2.6% $881.12 $50.00 10% $100 0%
2002 1.4% $927.23 $54.00 8% $100 0%
2003 2.1% $963.80 $58.70 9% $100 0%
2004 2.7% $961.12 $66.60 13% $100 0%
2005 4.1% $1,011.60 $78.20 17% $110 10%
2006 3.3% $1,045.85 $88.50 13% $124 13%
2007 2.3% $1,077.55 $93.50 6% $131 6%
2008 5.8% $1,083.34 $96.40 3% $135 3%
2009 0.0% $1,168.60 $96.40 0% $135 0%
2010 0.0% $1,189.77 $110.50 15% $155 15%
2011 3.6% $1,231.96 $115.40 4% $162 5%
2012 1.7% $1,309.58 $99.90 -13% $140 -14%
2013 1.5% $1,320.58 $104.90 5% $147 5%
2014 1.7% $1,367.58 $104.90 0% $147 0%
2015 0.0% $1,361.91 $104.90 0% $147 0%
2016 3.1% $1,341.00 $118.80/$121.804 13%/16%4 $166 13%
2017 2.7% n/a $120.70 2%5 $169 2%
2018 2.7% n/a $122.30 1% $171 1%
2019 2.7% n/a $132.20 8% $185 8%
2020 2.7% n/a $140.00 6% $196 6%
2021 2.7% n/a $147.60 5% $207 6%
2022 2.7% n/a $155.80 6% $218 5%
2023 2.7% n/a $164.50 6% $230 6%
2024 2.7% n/a $173.90 6% $243 6%
NOTES: n/a is not available.
1COLA increase applies to Social Security benefits in the following year. 2016-2024 amounts are projected.
2Average monthly benefit for retired worker, by year of entitlement, December of each year, except for 2015 (August) and 2016 (January estimate).
32017-2024 amounts are projected and do not include monthly repayment amounts (where applicable).
4Premium amounts and percent increases shown without and with the $3 repayment amount. 5Amount represents percent increase over 2016 premium rate without the repayment surcharge.
SOURCE: Kaiser Family Foundation, data from CMS, 2015 Medicare Trustees report, 2015 Social Security Trustees report, and 2016 Social Security Fact Sheet.

Appendix B

How the Hold-Harmless Provision Works

The following example illustrates how the hold-harmless provision works in a typical year with a Social Security COLA. Between 2012 and 2013, the standard Medicare premium increased by $5 from $99.90 to $104.90, and the Social Security COLA for 2013 was 1.7 percent. For a Medicare beneficiary receiving Social Security benefits of $300 per month in 2012, the 1.7 percent COLA translates to an additional $5.10 in 2013, which is sufficient to cover the premium increase. But for a beneficiary receiving $250 per month in Social Security benefits, the 1.7 percent COLA translates to just $4.25 in additional benefits in 2013, which would trigger the hold-harmless provision for this beneficiary. Rather than paying the full standard amount of $104.90 in 2013, this beneficiary would only be responsible for paying an additional $4.25 for the Part B premium, or $104.15. If the hold-harmless provision were not in place, this beneficiary would face a reduction in their Social Security benefits in order to pay the standard Part B premium amount.

Issue Brief

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