Ask Phil: What’s new with Medicare in 2023?
Written by Phil Moeller, UnitedHealthcare Contributor, Medicare And Retirement Expert
The New Year is bringing with it lower Medicare premiums, continued growth in Medicare Advantage plans, new consumer changes created by the Inflation Reduction Act (IRA) and advantageous rules for new Medicare enrollees. Here’s what to know.
IRA provisions
The monthly cost of insulin will be capped at $35 for Medicare beneficiaries. Expanded access to no cost adult vaccines is also part of the new law. Also beginning this year, prescription drug companies will pay financial penalties for raising prices by more than the general rate of consumer price inflation.
Additional IRA provisions when it comes to drug costs will be enacted between 2024 and 2026, so stay tuned.
Medicare premiums, deductibles, copays and high-income surcharges
Monthly Part B premiums are decreasing to $164.90 from $170.10 in 2023, the first year-over-year drop in 10 years. The annual Part B deductible is also declining, to $226 from $233. Part B covers doctors, medical equipment and other outpatient expenses.
The deductible for a hospital stay, covered by Part A, will rise to $1,600 this year from $1,556 in 2022. Copays for stays longer than 60 days will also be slightly higher – $400 per day for the 61st through 90th day of a hospitalization ($389 in 2022) in a benefit period, and $800 per day for lifetime reserve days ($778 in 2022). The daily coinsurance in skilled nursing facilities for days 21 through 100 of extended care services in a benefit period will be $200 ($194.50 in 2022).
The maximum annual 2023 Part D deductible is $503, up from $480, and the average monthly premium is dropping to $31.50 from $32.08 in 2022.
The so-called “donut hole” between when insurance coverage ends and the catastrophic phase of Part D plans begins will range from $4,660 to $7,400 this year, compared with $4,430 to $7,050 in 2022.
Part B and D surcharges for high-income beneficiaries also are dropping this year, in line with the Part B premium reductions.
Here are those details:
Medicare Part B Income-Related Monthly Adjustment Amounts1
| Individual Returns | Joint Returns | IRMAA | Total |
|---|---|---|---|
| $97,000 or less | $194,000 or less | $0.00 | $164.90 |
| $97,001 to $123,000 | $194,001 to 246,000 | $65.90 | $230.80 |
| $123,001 to $153,000 | $246,001 to $306,000 | $164.80 | $329.70 |
| $153,001 to $183,000 | $306,001 to $366,000 | $263.70 | $428.60 |
| $183,001 to $499,999 | $366,001 to $749,999 | $362.60 | $527.50 |
| $500,000 and up | $750,000 and up | $395.60 | $560.50 |
Medicare Part D Income-Related Monthly Adjustment Amounts1
| Individual Returns | Joint Returns | IRMAA |
|---|---|---|
| $97,000 or less | $194,000 or less | $0.00 |
| $97,001 to $123,000 | $194,001 to 246,000 | $12.20 |
| $123,001 to $153,000 | $246,001 to $306,000 | $31.50 |
| $153,001 to $183,000 | $306,001 to $366,000 | $50.70 |
| $183,001 to $499,999 | $366,001 to $749,999 | $70.00 |
| $500,000 and up | $750,000 and up | $76.40 |
Medicare Advantage
Enrollment in Medicare Advantage (MA) plans is projected to reach 31.8 million this year, exceeding half of all Medicare enrollees. Many MA plans charge no additional premium beyond the monthly Part B premium. The projected average premium for MA plans this year is $18 per month, the Centers for Medicare and Medicaid Services (CMS) says, a decline of nearly 8% from 2022.
Premiums are only part of what to look for in an MA plan. Many plans already cover fitness club memberships plus dental, hearing, and vision coverage. More plans also will be offering supplemental benefits including at-home meals and other non-medical items. Original Medicare does not offer supplemental benefits.
Easier enrollment rules
The Beneficiary Enrollment Notification and Eligibility Simplification Act (BENES) takes effect this year. It introduces one-month waiting times for the effective date of Medicare coverage for new enrollees – whereas before, some new beneficiaries had to go without coverage for much longer periods under older rules.
