Medicare Premiums May Increase By Record Amount

Medicare Part B premiums are forecast to increase by $15.90 in 2008, the largest single-year hike in the history of the program, according to a new analysis by the Senior Citizens League. The 17 percent increase would bring the premium to $109.40, up from $93.50 in 2007. Medicare Part B pays for doctors’ visits, tests, and outpatient hospital care. The large Medicare premium increase could mean that many will see no increase in their Social Security checks. The Congressional Budget Office (CBO) estimates that seniors will receive just a 1.5 percent Social Security Cost of Living Adjustment (COLA) in 2008. For the person with an average monthly Social Security benefit of $1,044, that would result in a $15.70 monthly increase—less than the increase in Medicare premiums. Almost all beneficiaries have their Medicare Part B premiums automatically deducted from their Social Security checks.

The reason for the forecasted increase is the growing deficit in the Medicare program. In 2006, Medicare’s Trustees announced that closing the deficit would require an 11 percent increase in Part B premiums for 2007, but the Bush administration, which sets the final rate for Medicare premiums, opted instead for a lower 5.6 percent increase.

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About Evan H Farr, CELA, CAP

Evan H. Farr is a 4-time Best-Selling author in the field of Elder Law and Estate Planning. In addition to being one of approximately 500 Certified Elder Law Attorneys in the Country, Evan is one of approximately 100 members of the Council of Advanced Practitioners of the National Academy of Elder Law Attorneys and is a Charter Member of the Academy of Special Needs Planners.

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