2011 Medicare Premiums, Deductibles and Co-pays

Medicare Supplement Insurance ImageThe 2011 Medicare premium, deductible and co-pay charges were recently announced and the changes for most seniors will be minimal, unless you’re a high-income beneficiary. Here is a quick snapshot of the announced changes.

2011 Medicare Premiums: Since the Social Security Administration will not be giving out a cost of living increase (or COLA) in 2011, the Medicare Part B premiums for most beneficiaries will not increase either. Thanks to the “hold-harmless” law, which prohibits Part B premiums from rising in any year that there’s no COLA, the 2011 monthly premium will remain at $96.40 for most existing beneficiaries, or $110.50 if you enrolled in the program this year.

Unfortunately, the “hold-harmless” law does not protect new Medicare beneficiaries or those who pay a higher Part B premium based on their higher income. New Part B enrollees (those who enroll in 2011) will pay $115.40 per month. The premiums for higher-income beneficiaries will vary depending on the income level they reported on their 2009 tax returns. Here’s how their Part B premiums break down next year:

• Individuals with incomes of $85,000 to $107,000, or married couples filing joint tax returns with incomes of $170,000 to $214,000, will pay $161.50 per month.

• Individuals earning $107,000 to $160,000 (couples $214,000 to $320,000) will pay $230.70.

• Individuals with incomes of $160,000 to $214,000 (couples $320,000 to $428,000) will pay $299.90.

• Individuals with incomes higher than $214,000 or couples above $428,000 will pay $369.10.

Also, another change that high-income beneficiaries need to be aware of is a new surcharge on Part D premiums. High-income seniors who have a Medicare Part D prescription drug plan will pay an additional $12 to $69.10 per month on top of their regular Part D premiums, depending on their income.

2011 Medicare Deductibles and Co-pays: Additional Medicare changes that will affect all beneficiaries include the Part B  (medical or “doctor”) deductible, which will increase to $162 in 2011 ($155 in 2010). The Part A (hospital insurance) deductible which will go up to $1,132 (it’s currently $1,100) for hospital stays up to 60 days…$283 per day for days 61-90 and up to $566 a day for days 91-150. The skilled nursing facility co-payment for days 21-100 will increase to $141.50 per day ($137.50 in 2010).

Tip 1:  If you are a high-income beneficiary and income has fallen since 2009 (the tax year used to determine your 2011 premiums), you may be able to reduce or eliminate your surcharge. To qualify, your income loss must be tied to a life-changing event such as a marriage or divorce, a job loss or reduced work hours (including retirement), loss of income from income-producing property, or cuts in pension benefits. To learn more, see SSA publication (No. 05-10161).

Tip 2:  Try to boost income by reducing your Medicare related expenses.  Medicare beneficiaries can oftentimes reduce their current premiums on Medicare Supplement insurance (also called Medigap insurance).  Contact Texas Senior Benefits and receive a complimentary Medicare Supplement Quote.