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Medicare costs will increase in 2005
With record high increases in Medicare premiums and deductibles on the horizon, it's more important than ever to help clients plan for the high cost of health insurance in retirement. The Centers for Medicare & Medicaid Services (CMS) has announced the following rate increases for 2005:
|
2004 |
2005 |
| Medicare Part A payroll tax |
1.45% |
1.45% |
| Medicare Part A deductible for
inpatient hospital stay of 1-60 days |
$876 |
$912 |
| Medicare Part A daily
coinsurance for 61st through 90th day of hospitalization |
$219 |
$228 |
| Medicare Part A daily
coinsurance for 91st through 150th day of hospitalization (lifetime reserve) |
$438 |
$456 |
| Medicare Part A daily
coinsurance for the 21st through 100th day of extended care in a skilled
nursing facility |
$109.50 |
$114 |
| Medicare Part A monthly premium
for individuals with less than 30 quarters of Medicare-covered employment
and certain disabled individuals |
$343 |
$375 |
| Medicare Part A monthly premium
for individuals with 30-39 quarters of Medicare-covered employment |
$189 |
$206 |
| Medicare Part B monthly premium |
$66.60 |
$78.20 |
| Medicare Part B deductible |
$100 |
$110 |
As a result of the Medicare Drug, Improvement, and Modernization Act of 2003, the Medicare Part B deductible is increasing for the first time ever. The Medicare Part B premium is also rising due to sharply higher Medicare program costs, and is the largest premium increase in Medicare history.
However, this premium increase may not be permanent. Bills have been introduced in Congress to limit Part B premium increases in 2005 and future years. We'll keep you informed regarding future developments.
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