Inflation is 8.3%, medical costs are up by 5.4%, the average hospital stay for Medicare patients is $13,600 and the most recent estimate is that people aged 65 will pay $315,000 for medical care during their retirement years.
So what’s the good news about retiree medical costs? For the first time in more than a decade, your Medicare Part B payments will be going down in 2023.
For help navigating Medicare Part B payments and how these payments will affect your overall financial picture, consider matching with a financial advisor.
How Large is the Medicare Part B Decrease?
Even though gas, groceries, and rent is too high, Part B recipients will pay $5.20 less per month, for annual premium savings of $62.40. In addition, the annual Part B deductible also will decline slightly, slipping down by $7 to $226.
The lower rates recently were announced at a White House event by President Joe Biden.
“That’s a fee you pay for Medicare to cover your visits to your doctor,” Biden said. “For years, that fee has gone up. Now, for the first time in more than a decade, it’s going to go down. And millions of seniors and people with disabilities on Medicare, that means more money in their pockets while still getting the care they need.”
Part B is one of several aspects of Medicare, which is available to Americans 65 and older. Part A covers inpatient care in hospitals, skilled nursing facility care, hospice care and home health care. Part D covers some prescription drug costs, including many shots and vaccines).
According to the Medicare.gov site, Medicare Part B covers:
- Services from doctors and other healthcare providers
- Outpatient care
- Home health care
- Durable medical equipment (like wheelchairs, walkers, hospital beds, and other equipment
- Many preventive services (like screenings, shots or vaccines, and yearly “wellness” visits
Additional Medicare Cost Decreases for 2023
Premiums also are set to decline on the Part D drug coverage portion of Medicare, with the average basic monthly premium for standard Part D coverage expected to come in at $31.50, down from $32.08 in 2022.
When it comes to Part C – more commonly known as Medicare Advantage – seniors can expect to see additional savings in 2023, according to the Centers for Medicare & Medicaid Services. This part of Medicare involves purchasing approved coverage plans from private insurers as an alternative to Medicare that covers the services offered under Part A, Part B and usually Part D.
According to the centers, the 2023 projected premium for Medicare Advantage plans is expected to drop by 8% from 2022 to $18 per month, down from $19.52. The lower premium for 2023 comes after an earlier 10% reduction in the average premiums from 2021.
When Is Medicare Open Enrollment for 2023?
The annual open enrollment plan for Medicare runs from Oct. 15 to Dec. 7, when eligible seniors can sort through all the coverage 2023 options at Medicare.gov. Seniors become eligible to sign up for Medicare three months before their 65th birthday, although people with a disability, End-Stage Renal Disease or ALS (Lou Gehrig’s disease) can be eligible to sign up earlier.
Amid rampant inflation and other economic challenges, there’s a sliver of good news for retirees: Medicare Part B costs are decreasing for the first time in a decade.
Tips for Retirement
- You can prepare for retirement on your own but there is a lot to consider, especially when you take into account that so many people have been blindsided by these increasing medical costs. You can also work with a financial advisor who can properly plan to deal with any concerns you have about your impending retirement. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- If you’re trying to find the right balance in your retirement portfolio, consider using SmartAsset’s free asset allocation calculator to help you get the right mix that can help you hit your financial goals.
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