Medicare costs are going up in 2017

Medicare costs are going up in 2017.  Most people on Medicare currently pay a Part B premium of $104.90.  That will go up in January to about $109.

For people who are new to Medicare, or those who are not yet collecting Social Security, their Part B premium will be $134.

Part B of Medicare covers doctor visits, lab tests, physical therapy, chemo and radiation treatments, and most non-hospital services.

Part B of Medicare has a deductible and that is going up in 2017 to $183.  It is $166 in 2016.

Everyone pays the Part B premium

Whether your Part B premium is $109 or $134, you must pay that to enroll in a Medicare supplement or a Medicare Advantage plan. Without Part B, you don’t really have Medicare because Part A covers hospitalization – but not a visit to the Emergency Room.

Why Medicare costs are going up.

Medicare Part B is highly subsidized by taxpayers.

People on Medicare do not realize their Part B premium ($109 or $134) only covers about 25% of the cost of Part B services. The other 75% comes out of the federal budget – and this is what all the fighting over Medicare is all about.

The info below shows (in copper color of the last two columns) that, in 2014,  73% of Part B funding came from general revenues while 74% of Part D funding came from general revenues.

The total Medical budget was around $600 billion in 2014.  Of course, that is going up each year.

Total Part B expenses were about $259.8 billion in 2014.

Total Part D (drug coverage) expenses were $78.2 billion in 2014.

medicare funding sources

medicare funding sources


I have written about “Politics and Medicare” and what can be done to control rising costs in the program.

Some people get help with their Medicare costs based on their income.

6 comments for “Medicare costs are going up in 2017

  1. Orene J Morin
    11/11/2016 at 2:54 pm

    Unfortunately, my husband, who has been on SSDI for over 10 ys, is now on Medicare. The financial numbers actually stayed the same. Both of us are in extremely expensive medication, which will only increase. The UNFORTUNATE PART, is that we make over the pittance they allow to be electable for reduced cost of any medications.
    At the moment we are doing okay, but I shutter to think of a few years , or sooner from now, when inflation continues to again take huge bites out of our net income. Still with an over 300,000. Mortgage to pay off. Unfortunately, the housing economy collapsed just after we re- financed. Who knew?
    So, thanks for keeping us all aware of the upcoming changes. Greatly appreciated!

  2. Orene J Morin
    12/01/2016 at 7:05 pm

    Good Evening,
    Am I correct in reading this notice, that because I put off collecting my S.S., that my monthly Medicare part B will be increasing to 134/ month? I have been paying the regular amount, as is my husband, since we both applied for Medicare last year.
    I decided to defer my SS., hopefully until reach up, to get the increase in percentage.
    I had heard that Medicare payments were increasing, but would be increasing for ONLY new sign ups for part B to 134.00.
    This letter is stating that NEW sign ups for part B AND people not yet signed up for S.S. WILL need to pay the increase to 134.00 per month.
    I do hope this was an Error, as it would mean a 26.00 / month increase per month for me.
    Please clarify, as this will considerably effect my monthly budget.
    I would greatly appreciate your response.
    Orene J. Morin

  3. Denise
    12/03/2016 at 12:50 pm

    Sorry to confirm that the information is correct and you will be paying the higher Part B premium. That’s because you are not yet collecting Social Security and so you are not protected by the “hold harmless” rule.

    That rules says that people who pay their Medicare premium through their social security account cannot have a Part B premium increase that is more than their Social Security increase.

    Folks who are not yet collecting Social Security, or those who will be new to Medicare in 2017 will pay the higher Part B premium. There is no way to avoid this.

  4. Don
    12/14/2016 at 1:12 pm

    Denise, I will go on Medicare in February 2017. But I don’t plan to go onto social security until February 2018. Does that mean my premium will never be any lower than what the premium will be in 2018? So for instance, my brother who went onto social security three years ago will always pay a considerably much lower premium than I will for the rest of our lives? Or will I see a reduction in my premium to match the premium of others currently getting social security once I am collecting social security? That is really disturbing and in my opinion criminal if I and the rest of people not currently on social security will have to pay much higher premiums for the rest of our lives. Could you please confirm or tell me that I’m missing something?
    Thanks so much for helping all of us navigate the system!

  5. Denise
    01/18/2017 at 1:24 pm

    It doesn’t look like I responded to this email, but Don is not going to be happy with my answer anyway. Unless the Medicare Part B premium goes down in the future, Don will always be paying more than is brother.

    Five or six years ago, the Part B premium went down and everybody got that lower charge.

    The Part B premium is based on some complicated formula (and not politics) that includes the increase in spending through Part B. (doctor visits, labs, MRIs, CT scans, chemo and radiation…)

    The Part B premium was actually supposed to go up to something like $159 in 2016. But Democrats and Republicans agreed to move money around in the Medicare account and only raise the premium to $122. They’ve probably done something similar this year to keep Don’s premium at $134.

  6. 04/09/2017 at 6:32 am

    This is a rip off. Who can we complain to. I get 460.00 a month and I have to pay 134.00 a month out of that. Then I have to get a supplement also I will be living on nothing.

Leave a Reply

Your email address will not be published. Required fields are marked *