Medicare's Monthly Premium Won't Rise in 2009

Sept. 20 -- FRIDAY, Sept. 19 (HealthDay News) -- Good news for millions of American seniors: Medicare's standard Part B monthly premium in 2009 will remain the same as in 2008, the U.S. Centers for Medicare & Medicaid Services said Friday.

The $96.40 rate means 2009 will be the first year since 2000 that there hasn't been an increase in the standard premium over the previous year, the agency said. In addition, the 2009 Part B deductible will be the same in 2009 as it is this year -- $135.

Medicare's Part B program covers the health care of seniors and disabled people. The monthly premium paid by beneficiaries covers a portion of the cost of physicians' services, outpatient hospital services, certain home health services, durable medical equipment and other items.

While increased use of Part B services is expected in 2009, the higher anticipated costs are "offset by a substantial reduction in the premium 'margin' needed to maintain an adequate contingency reserve in the Part B trust fund account," the CMS explained in a news release.

The Part B premium is based on a beneficiary's annual income. If gross income is greater than certain amounts ($85,000 in 2009 for a beneficiary filing an individual income tax return or married and filing a separate return, and $170,000 for a beneficiary filing a joint tax return), the beneficiary has to pay a larger portion of the estimated total cost of Part B benefit coverage.

One advocate for Medicare recipients said the decision to keep Plan B premiums the same is "welcome news."

"News that health care premiums are not going up is rare these days. The stability in the Part B premium is good news for people with Medicare struggling to cope with rising prescription drug costs and medical bills," Robert M. Hayes, president of the Medicare Rights Center, said in a news release.

However, the CMS also announced Friday that the Part A deductible will rise $44, to $1,068 in 2009. The Part A program covers hospital and hospice care as well as short stays in nursing homes. About 99 percent of Medicare beneficiaries covered by this program do not pay a monthly premium. The deductible is their only cost for up to 60 days of Medicare-covered inpatient hospital care in a benefit period.

Beneficiaries must pay an additional $267 per day for days 61 through 90 in 2009, and $534 per day for lifetime reserve days that can be used for hospital stays beyond the 90th day in a benefit period. In 2008, those amounts are $256 and $512, respectively. Daily coinsurance for the 21st through 100th day in a skilled nursing facility will be $133.50 in 2009, up from $128 in 2008, the CMS said.

For beneficiaries who have to pay for Part A coverage, the monthly premium will increase from $423 in 2008 to $443 in 2009.

In mid-August, the CMS said the average monthly premium for Medicare's prescription drug plan will increase from $25 this year to $28 in 2009. The premium for next year is 37 percent lower than originally projected when the Part D drug coverage was introduced in 2003.

More information

For more about Medicare premiums, go to the Medicare Web site.

SOURCES: U.S. Centers for Medicare and Medicaid Services, news release, Sept. 19, 2008; Medicare Rights Center, news release, Sept. 19, 2008