Issue Brief 15-30
September 28, 2015

A recent Medicare Trustees report estimated a substantial increase in monthly Medicare Part B premiums in calendar year (CY) 2016 for some beneficiaries due to a hold-harmless provision and to maintain adequate contingency reserves. According to the report, Social Security beneficiaries are expected to see a 0% cost-of-living adjustment (COLA) in 2016. If this occurs, it would trigger a hold-harmless provision that prevents most Medicare beneficiaries (those that have Medicare Part B premiums deducted from their monthly Social Security benefits) from seeing an increase in their monthly Medicare Part B premiums.

Under this scenario, remaining beneficiaries, including those individuals who qualify for both Medicare and Medicaid (dual eligibles), could see a 52% increase in their monthly premiums, from $104.90 in CY 2015 to $159.30 in CY 2016. Because Medicaid pays the Part B premiums for dual eligibles, FFIS estimates that the state share of Medicaid costs would increase by $2.3 billion in CY 2016 if the monthly premiums increase to $159.30. The Department of Health and Human Services (HHS) is expected to announce the final 2016 monthly premiums in mid- to late October.