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By Aliss Higham
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Medicare premiums will rise in the New Year, the Centers for Medicare & Medicaid Services (CMS) has announced.
Medicare is a federal health insurance program overseen by the Social Security Administration (SSA). It covers people 65 and older and some under 65 who have certain disabilities or conditions.
Medicare Part B covers doctor visits, outpatient care, preventive services such as vaccines, equipment like wheelchairs, and home health care. Part A covers inpatient hospital and facility care and does not have premiums for most beneficiaries.
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As of January 2025, Medicare Part B premiums will rise by around 6 percent.
In 2025, the standard monthly premium for Medicare Part B enrollees will be $185, a $10.30 increase from the 2024 rate of $174.70. This is deducted from Social Security checks every month. For those who don't receive Social Security, payments must be made directly through their Medicare account, with their bank, or by mail, with bills sent every three months.
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The annual deductible for all Medicare Part B beneficiaries will rise to $257 in 2025, up $17 from the $240 deductible in 2024.
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All Medicare Part B enrollees pay the standard premium, but wealthier people also pay what is known as an Income-Related Monthly Adjustment Amount (IRMAA). Income thresholds for married individuals who lived with their spouse at any time during the year and filed separate tax returns are as follows:
- Income of $106,000 or less will pay only the standard Medicare Part B premium of $185.00 per month.
- Beneficiaries with incomes over $106,000 but under $394,000 will pay an IRMAA of $406.90 plus the standard $185.00,
- Those with incomes exceeding $394,000 will pay an IRMAA of $443.90 and the standard $185.00 premium, which amounts to $628.90 per month.
For Part A, the inpatient hospital deductible will rise by $44 to $1,676 next year, up from $1,632 in 2024. For those who have not worked long enough to qualify for premium-free Part A, the monthly Part A premium will be $518, up $13 from this year.
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The 2025 Medicare Part B premium surpasses inflation and the Social Security Cost of Living Adjustment (COLA), which is used to boost benefits every year so seniors and other recipients don't lose purchasing power over time. Annual inflation rose 3.2 percent in October, while the COLA 2025 will be 2.5 percent.
The CMS said the changes are due to "projected price changes and assumed utilization increases that are consistent with historical experience." Medicare premiums don't always rise every year—but declines in costs are rare. The premium was $164.90 in 2023, falling by a little more than $5 from the previous year.
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