CMS Releases 2009 Medicare Premium and Deductible Amounts

The Centers for Medicare & Medicaid Services (CMS) recently announced the standard premium and deductible amounts for Medicare Parts A and B for 2009. Here is a summary of the 2009 values released by CMS:

Medicare Part A Premium
While approximately 99 percent of Medicare beneficiaries do not have to pay a premium for Part A services, several seniors and certain people under age 65 with disabilities may obtain Part A coverage by paying a monthly premium of $443 per month (up from $423 in 2008). Individuals entitled to a reduced monthly premium will be required to pay $244 a month for coverage (up from $233 in 2008).

Medicare Part A Deductible and Coinsurance Amounts
The Part A deductible, paid by the beneficiary when admitted as a hospital inpatient, has increased to $1,068 (up from $1,024 in 2008). This deductible is the beneficiary’s only cost for up to 60 days of Medicare-covered in-patient hospital care in a benefit period. Beneficiaries must pay an additional $267 per day (up from $256) for days 61 through 90 in 2009, and $534 per day (up from $512) for “lifetime reserve days” that can be used for hospital stays beyond the 90th day in a benefit period. Daily coinsurance for days 21 through 100 in a skilled nursing facility will be $133.50 in 2009 (up from $128).

Medicare Part B Premium and Deductible
As stated earlier, the Part B standard premium ($ 96.40) and deductible ($135) will remain unchanged, marking the first time since 2000 that no change was made to these values from the previous year.

However, individuals who earn over the statutory amount may be required to pay more than the standard rate. As required in the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the Part B premium a beneficiary pays each month is based on his or her annual income. Specifically, if a beneficiary’s “modified adjusted gross income” is greater than the legislated threshold 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 is responsible for a larger portion of the estimated total cost of Part B benefit coverage.

In addition to the standard, such beneficiaries now have to pay an income-related monthly adjustment amount. These income-related Part B premiums have been phased-in over three years, beginning in 2007. Next year is the first year in which affected Part B enrollees will pay the full amount of the income-related premiums. About 5 percent of current Part B enrollees are expected to be subject to the higher premium amounts.

To view specific rate information for beneficiaries earning more than the statutory amount, please see the official CMS release. If you have any questions about these new values, please contact our office at 919-403-1986.

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October 1, 2008

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