By Kevin Rigg, Director of Financial Life Planning, SoundView Advisors
Medicare's Open Enrollment Period — which began October 15 and runs through December 7 — is your annual opportunity to switch your current Medicare health and prescription drug plans to ones that better suit your needs. During Open Enrollment, you can:
Switch from Original Medicare to a Medicare Advantage Plan
Switch from a Medicare Advantage Plan to Original Medicare
Change from one Medicare Advantage Plan to a different Medicare Advantage Plan
Change from a Medicare Advantage Plan that offers prescription drug coverage to a Medicare Advantage Plan that doesn't offer prescription drug coverage
Switch from a Medicare Advantage Plan that doesn't offer prescription drug coverage to a Medicare Advantage Plan that does offer prescription drug coverage
Join a Medicare prescription drug plan (Part D)
Switch from one Part D plan to another Part D plan
Drop your Part D coverage altogether
Now is the time to review your current Medicare benefits to see if they're still right for you. If your current plan doesn't meet your needs or fit your budget, you can switch to a new plan and any changes made are effective January 1, 2023. If you are satisfied with your current Medicare plan and it's still being offered, you don't have to do anything.
Just in time for Open Enrollment, 2023 Medicare premiums, deductibles, and other costs have been announced. Surprisingly, some of these costs are lower than they were last year. The details of these changes are listed below:
Medicare Part B (Medical Insurance) costs for 2023
Most people with Medicare who receive Social Security benefits will pay the standard monthly Part B premium of $164.90 in 2023. This premium is $5.20 lower than it was in 2022. People with higher incomes may pay more than the standard premium. If your modified adjusted gross income (MAGI) as reported on your federal income tax return from two years ago (2021) is above a certain amount, you'll pay the standard premium amount and an Income-Related Monthly Adjustment Amount (IRMAA), as shown in the following table.
People with higher incomes may also pay a higher premium for a Medicare Part D prescription drug plan because an IRMAA will be added to the Part D basic premium based on the same income limits in the table above. Part D premiums vary, but the average basic monthly premium for 2023 is projected to be $31.50 (down from $32.08 in 2022).
People with Medicare Part B must also satisfy an annual deductible before Original Medicare starts to pay. For 2023, this deductible is $226 (down from $233 in 2022).
Medicare Part A (Hospital Insurance) costs for 2023
Part A deductible for inpatient hospitalization: $1,600 per benefit period (up from $1,556 in 2022)
Part A premium for those who need to buy coverage: up to $506 per month (up from $499 in 2022) — most people don't pay a premium for Medicare Part A
Part A coinsurance: $400 per day for days 61 through 90, and $800 per "lifetime reserve day" after day 90, up to a 60-day lifetime maximum (up from $389 and $778 in 2022)
Part A skilled nursing facility coinsurance: $200 for days 21 through 100 for each benefit period (up from $194.50 in 2022)
Please let your advisory team know if you have any questions related to your Medicare coverage and they will be sure to point you in the right direction. You can also view more information in the Medicare & You 2023 Handbook and access a Medicare plan finder tool that allows you to compare health and drug coverage options at medicare.gov.