I write this blog with a heavy heart. I continually ask myself how much more can low- and fixed-income individuals endure? According to the USDA ERS findings, wholesale beef prices are predicted to increase up to 24.0 percent, wholesale poultry prices are predicted to increase up to 21.0 percent, and farm-level egg prices are predicted to increase up to 13.0 percent in 2021. According to CNBC.com, gas prices are at a seven-year high. Nonetheless, the government would like to pile on another unexpected 14.5 percent increase to your Medicare premiums and deductibles. Here are the new premiums, deductibles, and co-insurance costs for 2022.
|Part A Inpatient Deductible
|Inpatient Coinsurance Days 61 – 90
|Skilled Nursing Facility Days 21-100
|Part B Premium
|Part B Deductible
Most people will recognize the cost increase in their Social Security checks from where their Part B Premium is deducted. Instead of $148.50 for Part B being deducted as it is every month in 2021, your January 2022 check will show at least a $170.10 deduction. It will be even more if you are charged the IRMAA, “success tax.” Don’t fret though (add facetious tone here), you will receive a 5.9 percent cost-of-living adjustment or COLA increase.
With all of these unexpected cost increases, we are seeing many individuals switch from Medicare Supplements to Medicare Advantage plans this AEP. Although you pay either way, Medicare Advantage (MA) plans allow you the luxury of lower, and sometimes $0, premiums. Thus, you only pay when you use the plan versus paying a fixed cost upfront with a Medicare Supplement regardless, of if you go to the doctor. Moreover, most MA plans include a prescription drug plan (PDP); therefore, you are saving the premium that a PDP costs as well. Many also like the added ancillary benefits of dental, vision, hearing, and gym memberships that are included in some plans.
We are currently in AEP and it lasts until December 7th. Any plan changes that take place will have a January 1st effective date. You may also utilize this election period if you never enrolled in a MAPD and would like to explore this option. Most of the time, AEP is the only time of year that you can change your plan.
December 7th is the last day to make a change before most people are “locked in” to their plan for 2022. If you need to minimize your 2022 fixed expenses, call Hovis & Associates at (800) 411-0737 or check out our Medicare FAQs on our website. We make Medicare SIMPLE!