Medicare’s Part B monthly premium for 2022 will increase by $21.60, the largest dollar increase in the health insurance program’s history, the Centers for Medicare & Medicaid Services (CMS) announced on Nov. 12. Standard monthly premiums for Part B will cost $170.10 in 2022, up from $148.50 in 2021.
Medicare Part B covers doctor visits, and other outpatient services, such as lab tests and diagnostic screenings. CMS officials gave three reasons for the historically high premium increase:
- Rising prices to deliver health care to Medicare enrollees and increased use of the health care system. Some of the higher health care spending is being attributed to COVID-19 care.
- In 2021, because of the pandemic, Congress took action to significantly lower the expected Part B premium increase for that year, something AARP fought hard for. In 2021, the Part B premium increased only $3 a month. Congress directed CMS to pay back that reduced premium over time and that payback is starting in 2022.
- CMS is setting aside money in its reserves in the event it decides that Medicare will cover, Aduhelm, a new Alzheimer’s drug that was approved by the U.S. Food and Drug Administration (FDA) earlier this year. CMS is still doing an analysis to determine whether Medicare will cover Aduhelm — and how and any similar drugs to treat Alzheimer’s. CMS officials said the fact that they are setting aside money to cover the use of that drug “in no way implies what the coverage determination will be” but that they have to plan for the possibility that Medicare will cover this high-cost drug, whose price has been estimated at $56,000 a year.
CMS officials stressed that while the 14.5 percent Part B premium increase is a stiff one, the Social Security cost-of-living adjustment (COLA) — at 5.9 percent, the largest in 30 years – is estimated to average $92 per recipient. So even after the increase in the Medicare Part B premium, most Social Security recipients, whose Part B premiums are typically deducted from their Social Security benefits, will still see a net increase in their monthly check. The COLA goes into effect in January.
“Once again, American seniors and taxpayers will pay the price for the outrageous pricing behavior of big drug companies,” said Bill Sweeney, AARP senior vice president for government affairs. “When Big Pharma sets a high drug price, everyone pays for it — not just those who need the medications. That’s why Congress must act swiftly to pass prescription drug reforms in the Build Back Better Act, which would bring meaningful, much-needed relief to seniors and all Americans.”