Medicare Part B Premiums Decreasing for 2023

Costs Set To Decrease

The Centers For Medicare and Medicaid Services announced yesterday, 9-27-2022, how much Medicare beneficiaries will pay for Medicare Part B in 2023. In 2022 that monthly premium for the average person is $170.10/mo. Beginning January of 2023, this cost is decreasing to $164.90.

Cause of the Decrease in Medicare Part B

It’s great news that Medicare Part B will cost less in 2023. The average senior will save an extra $62 a year. But why, when everything else is getting more expensive, is Medicare going down? The answer is largely one drug, Aduhelm. Aduhelm is the Alzheimers wonder drug, which originally cost $56,000 per year. That was lowered to the bargain price of $28,200 per year. The trouble is that it lacks strong clinical evidence of efficacy.

Still, it was possible this very expensive drug would be approved for treatment to the general Medicare population. The Kaiser Family Foundation estimated it’s approval would cost Medicare an extra $29 billion per year. So, for 2022 the decision makers that determine what seniors pay for Medicare Part B added a contingency to pad the coffers in case Aduhelm was approved at large.

At least for now, Aduhelm is still available only for more limited cases until more research can be conducted. As a result, CMS has determined that the padding that was added for 2022 was no longer needed for 2023. Hence, Medicare Part B premiums are going down.

What This Means For Retirees

With Medicare Part B premiums set to decrease slightly, it is likely we will see a large increase to Social Security checks in 2023. We still have to wait for the final decision on the Cost of Living Adjustment (COLA), but indications so far are that Social Security benefits will receive an 8% or greater boost. Coupled with lower Medicare premiums, it’s possible seniors will see the largest increase to Social Security benefits ever.