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Medicare Part B Premiums Rise Again

Posted on: Tuesday, 12 September 2006, 21:00 CDT

By TODD ZWILLICH

Seniors' Part B premiums for doctors' visits and lab tests paid by Medicare are set to go up five dollars per month in 2007, the government announced Tuesday.

Most beneficiaries will now pay $93.50 per month, a 5.6 percent rise over this year's premiums. But Medicare officials warned that the costs could go higher if doctors groups succeed in their bid to prevent Medicare fee cuts.

At the same time, wealthy seniors will for the first time be asked to shoulder higher premium costs than others. The increases apply to Individuals with incomes above $80,000 per year and couples with incomes above $160,000 per year, Medicare said.

Part B deductibles are also scheduled to go up five dollars to $131. Seniors pay an average of $27 per month in premiums for the Medicare prescription drug benefit, and usually pay the first $992 in hospital costs unless they are low-income.

The increase is the smallest Part B increase since 2001. Seniors Part B costs went up 12 percent last year and 17 percent the year before.

Outgoing Medicare Chief Mark McClellan blamed the five dollar rise on a larger volume and cost of outpatient services at U.S. hospitals. Medicare proposed regulations this summer that would pare back hospitals' payments unless they agree to post limited quality information on the Internet.

Sen. Orrin Hatch, R-Utah, a member of the Finance Committee, pegged the increase as evidence that Medicare's policies are working and working well.

But Democrats warned that Medicare beneficiaries face mounting costs, and they blamed Republicans for not doing more to reign in overall health care spending. That's what's pushing Part B up, said Sen. Max Baucus, D-Mont., the senior Democrat on the Finance Committee.

While Medicare made its announcement Tuesday, the American Medical Association and other doctors' groups were on Capitol Hill lobbying lawmakers to stave off a scheduled 5 percent cut in Medicare physicians' fees.

Cuts have been scheduled nearly every year since 1997, and each year doctors have managed to head them off, often by last-minute action from Congress.

McClellan warned that the $93.40 in Part B premiums assumes that the cut will go into effect.

If that weren't to happen the cost increases would be bigger, Mark McClellan told reporters by telephone. If Congress votes to freeze doctors' fees instead of cutting them, seniors' costs would go up another $1.50 per month, he said.

Sen. Ron Wyden, D-Ore., another Finance Committee member, is among Democrats warning that seniors would face even higher costs as some of them enter the prescription drug benefit's donut hole. Medicare stops paying drug costs after $2,250 and does not pay again until beneficiaries spend $5,100 of their own money.

Millions of middle class seniors who live on modest incomes are going to see Part B increases bump up against the donut hole. It's a double whammy, he said

Under Medicare's new premium schedule, seniors with incomes between $80,000 and $100,000 per year pay $12.50 per month in additional premiums over the $93.50 paid by most seniors. Those making more than $400,000 per year are set to pay a total of $162.10 per month.

Source: United Press International

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