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Matt,

I’m on Medicare and draw Social Security.  I’m happy to hear I’m getting a 5.9% “raise” from Social Security.  When will the Medicare Part B premium costs for 2022 be announced?
Chris S.

Chris,

Medicare usually releases Part A and Part B premium increases in the first week of November of the prior year.  In 2020, they released the 2021 rates on November 6.

However, I suspect the question you’re really asking is – what’s my cashflow picture look like between the Social Security increase and my Medicare Part B premium?

There’s absolutely an interplay here between the Medicare Part B premium that (likely) comes out of your Social Security check every month and the amount of increase ahead for Medicare Part B.  They’re not siblings, but they are cousins.  Because they’re percentage increases and not flat dollar amounts, the Medicare Part B premium increases hurt folks who pay more due to IRMAA than those who do not.  If you haven’t filed your IRMAA appeal yet, be sure to do it soon. 

Remember, if you’re on Medicare and want a Medicare Supplement or a Medicare Advantage plan, you MUST have Medicare Part B. 

As you may have read, the feds are increasing the average Social Security check payment by almost 6% for 2022.  In 2021, they increased only 1.9%.  That’s obviously a huge, massive increase compared to historical annual increases.  To quote the WSJ article, the increase will translate to an addition of $92 to retirees’ average monthly benefit next year, bringing the amount to $1,657, the agency estimates.

Historically, the percentage increase to Social Security payments were very closely mirrored by the percentage increases to the standard annual Medicare Part B premium.  So, while we’ll know in a few short weeks, most are assuming a $10 per month increase in the Medicare Part B premium for 2022 for people NOT impacted by IRMAA.  That’s basically a 6.5% increase in Medicare Part B premium, which is also very large increase in historical terms. 

When you combine the two, the amount of money, or the real “cash” you’ll see in your checking account from the Social Security increase won’t be 5.9%… because it’ll be lowered by the Medicare Part B premium hike. 

So for folks making that “average” increase of $92 from the Social Security increase, it’s likely only really going to be a benefit of around $82 per month, which is an approximate 11% hit.   

If you’d like to read more, John Waggoner over at AARP did a nice breakdown of the issue, too.

Thanks for the question, Chris!

I love answering Medicare questions.  Send me yours at questions@prepareformedicare.comand I’ll pick a few for a future blog post!

To your wealth, wisdom and wellness!

-matt feret

Author Bio: Matt Feret is the author of the Prepare for Medicare book series and launched prepareformedicare.com to help people get objective answers to questions about Medicare. He’s also the host of The Matt Feret Show.

He’s held leadership roles at numerous Fortune 500 Medicare health insurers in sales, marketing, operations, product development and strategy for over 20 years.  Matt holds a BA from Virginia Tech and an MHA from Washington University in St. Louis. 

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