Medicare Part B premium and deductible are going down in 2023

Medicare’s Part B premium and deductible are declining in 2023 for the first time in years, giving seniors and people with disabilities a bit of financial relief as inflation continues to rise.

The Part B premium (the amount you pay per month) will be $164.90 in 2023 for most people, a decrease of $5.20 from this year’s rate. The Part B deductible (the amount you pay out of pocket before the plan covers a greater portion of costs) will be $226, down $7 from 2022.

At an event in the White House Rose Garden on Tuesday, President Joe Biden touted the rate cuts as an example of how he and Democrats support seniors, a key demographic in the upcoming midterm elections.

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Medicare is the publicly funded health program for people ages 65 and older and people with disabilities. Part B of the program covers doctor services, outpatient hospital services, and durable medical equipment, among other services not included in Medicare Part A (which primarily covers hospital care).

“You can count on one hand the number of times the Medicare Part B premium has decreased from one year to the next,” said Juliette Cubanski, deputy director of the program on Medicare policy at the Kaiser Family Foundation.

People with Medicare Advantage — Medicare plans managed by private insurers — typically face the same monthly Part B premium as people who opt for traditional Medicare. These plans often modify cost-sharing requirements for members, so it’s unclear how the lowered Part B deductible will affect people with Medicare Advantage, Cubanski said.

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Typically, Part B premiums increase by a few dollars a year, and no more than $10, she said.

But at the end of 2021, Medicare actuaries were concerned that a new Alzheimer’s treatment, Aduhelm, could significantly raise Medicare spending. To account for the potential additional cost, the Centers for Medicare and Medicaid Services increased the Part B premium by almost $22 in 2022 — an uncharacteristically high 15% price hike.

Months later, after rates were set, Aduhelm was approved for coverage by Medicare only when used as part of a clinical trial, which resulted in much lower spending than actuaries anticipated.

Now, some of the savings are being handed back to consumers in the form of premium and deductible decreases, though the Part B premium price is still above the 2021 rate of $148.50.

“It’s a bit of good news,” Cubanski said.