Are Your Medicare Costs Actually Decreasing in 2023?

Medicare Part B premiums reached an all-time high of $170.10 per month in 2022, squeezing cash-strapped seniors who also had to contend with rampant inflation this year. But next year is looking a little brighter, with some Medicare expenses actually decreasing for the first time in over a decade.

Seniors should be careful not to be overly optimistic, though. There's more than just premiums to think about. Here's a look at what's changing next year and how it could affect you.

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Medicare Part B costs are dropping

Medicare Part B, known as medical insurance, covers outpatient care, home healthcare, and preventive services. It's this part of the program that's going to be more affordable next year. Here's a look at how its premium and deductible are changing for the average senior:

Data source: Medicare.gov.

Joint filers with annual incomes exceeding $182,000 and other filers with incomes exceeding $91,000 pay more for Part B than the premium costs listed above, but their premiums will also decrease by a few dollars in 2023.

You'll pay your premiums regardless of how often you visit the doctor to keep your insurance in force, so that's $62.40 in savings compared to 2022. Not everyone will meet their Part B deductible, but those who do will bring their total annual savings up to $69.40.

But other Medicare costs are increasing

Other parts of Medicare are expected to increase once again in 2023, including the Part A deductible. Part A, or hospital insurance, covers in-patient hospital and nursing facility stays. Most people don't pay a premium for this, but there is a deductible. It's rising from $1,556 in 2022 to $1,600 in 2023 -- a $44 increase. 

Part A copayments, which are payments you must make toward your hospital bills even after you've met your deductible, are also expected to rise next year. But this might not affect you if you don't require any long hospital stays in 2023.

Part D plans and Medicare Advantage plans (Part C) could also rise next year. Part D plans cover prescription drug costs, and Medicare Advantage plans offer an alternative to Original Medicare (Parts A and B) that includes additional benefits. Both of these are part of Medicare, but they're offered and managed by private insurers. This gives seniors a variety of plans to choose from, and costs can vary widely from one plan to another.

Since everyone's health insurance plan is different and health conditions can spring up unexpectedly, it's not possible to predict what -- if any -- savings you'll receive on these other parts of Medicare.

Medicare costs aren't the same as healthcare costs

Medicare forms the foundation of most seniors' health insurance plans, but it also leaves a lot of gaps. Dental care, vision care, and hearing aids are just a few examples of common services that Original Medicare doesn't cover. 

Many seniors turn to a Medicare Advantage plan or purchase a Medicare supplement plan to give them help with these expenses. Like Medicare Advantage plans, Medicare supplement plans are run by private insurers, and they set their own prices. Those who choose to skip both of these must be prepared to pay for certain healthcare costs entirely on their own.

So while saving some money on Medicare Part B is great, it's not a guarantee your healthcare will actually be more affordable in 2023. There are steps you can take to ensure you're paying the best price, though.

How to save on healthcare costs in 2023

The best way for seniors to save on health insurance is to take advantage of the Medicare Open Enrollment Period, which is happening right now until Dec. 7, 2022. Use this time to compare all the Original Medicare and Medicare Advantage plans available to you. Weigh the following factors when deciding which is your best option:

• Price, including premiums, deductibles, and copays
• Coverage for treatments and medications you expect to need in 2023
• Which doctors and hospitals you're able to visit
• How it meshes with any other health insurance you have (through an employer, for example)

This is the only time most seniors can make changes to their health insurance plans for 2023, so you don't want to miss the opportunity. Start looking at your options as soon as possible so you aren't rushing to beat the December deadline.