Millions of older Americans get coverage through Medicare. And without it, the cost of taking care of their health would potentially be astronomical.
But Medicare is by no means free. And there are lots of costs enrollees need to take into account and budget for accordingly.
Meanwhile, the cost of Medicare has the potential to rise from one year to the next. And such is the case in 2024. Here are some of the ways Medicare is getting more expensive.
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1. The standard monthly Part B premium is rising
Medicare Part B enrollees are charged a monthly premium. Those who are also collecting Social Security have those premiums deducted from their benefits automatically, while those who aren't on Social Security have to pay them directly.
In 2023, the standard monthly premium for Medicare Part B is $164.90. In 2024, it will be $174.70, marking an increase of $9.80. That increase is going to eat into the 3.2% COLA seniors on Social Security are set to receive next year.
It's also worth noting that higher earners will pay even more for Medicare Part B in 2024. Single tax-filers with an income that exceeds $103,000 and joint filers with an income exceeding $206,000 will be subject to surcharges known as income-related monthly adjustment amounts, or IRMAAs.
2. The annual Part B deductible is rising
Medicare Part B enrollees are subject to an annual deductible. In 2023, that deductible is $226. Come 2024, it's rising to $240. So all told, that's a $14 increase.
By itself, that's not so bad. But when you factor in a monthly increase for Part B premiums, it puts more of a burden on enrollees, many of whom have limited funds at their disposal.
3. The cost of hospital care is rising
The majority of Medicare enrollees do not pay a premium for Part A, which covers hospital care. However, there's a cost to needing that care.
In 2023, the inpatient hospital deductible under Medicare Part A is $1,600. In 2024, it's rising to $1,632.
That deductible covers the first 60 days of a hospital stay only, though. Right now, the daily coinsurance cost for days 61 through 90 is $400. Next year, that cost is rising to $408.
Beyond day 90, Medicare enrollees have to dip into their lifetime reserve days for hospital stays, and there's a cost there, too. Right now, it's $800 per day. In 2024, that's going up to $816.
The cost of coinsurance for a skilled nursing facility is also rising. Enrollees are required to pay coinsurance for days 21 to 100. Right now, the cost is $200 per day. In 2024, it's rising to $204.
Be mindful of Medicare costs
Medicare enrollees are going to see a number of increases in 2024. Paying attention to what's in store can help seniors with limited financial resources plan accordingly.
To offset some of these rising costs, seniors can take advantage of the upcoming Medicare open enrollment period. Switching to a less expensive Part D or Advantage plan could result in some much-needed savings.
