Medicare Standard Monthly Premiums To Rise 3.1% In 2008 To $96.40
02 10 07 - 12:06
Hailing the lowest rise in six years, US health officials announced that the Medicare standard monthly premium will rise by 3.1% in 2008 to $96.40. An accounting mistake would have increased the premiums further, apparently - hence the lower increase, they say. As the formula to calculate the premium depends on physicians taking a 10% cut in reimbursement next year, many comment that the calculation of 3.1% is hopeful at best. If Congress decides to offset some of that cut, or gets rid of it altogether, premiums will have to rise.
43 Million American seniors (elderly) and disabled people are covered by the Medicare Part B program. This program has seen costs rise significantly over the last few years. Health officials announced that the average deductible for Part B will rise from the present $131 to $135 next year.
As far as Medicare Part A deductibles are concerned, this will increase from the current $992 to $1,024 in 2008 (the deductive paid by the beneficiary when admitted to the hospital). Medicare Part A progam is aimed at hospital and hospice care - beneficiaries do not pay a premium.
Individuals earning at least $80,000 per year will have to pay higher premiums; affecting about 5% of those covered by Part B.
According to Consumers Union in its latest sampling of Medicare prescription drug plans, most insurers raise their drug costs during the year - in one case by 28%. The Union says there should be fundamental changes in the law to protect seniors from bait and switch-type practices - especially now as the enrollment season looms.
Bill Vaughan, senior health policy analyst for Consumers Union, publisher of Consumer Reports, said "It makes no sense to ask a senior to carefully shop around in October and sign up for a drug plan, when the plan just turns around a few months later and dramatically hikes the cost of the medicines."
During the period February to September 2007 the Consumers Union discovered that 95% of plans offered in sampled areas raised their costs; a quarter of them by at least 5%, with a $140 average state increase during the period. Out of 289 plans in the sampled areas only 15 lowered their prices.
Vaughan said "Medicare expects seniors to lock into a drug plan for 12 months, but it doesn't require the drug plan to lock in their prices for that same time. How is that logical? Consumers should try to get a lower-cost plan that has decent quality indicators. Unfortunately, the plans can change their prices and wipe out those careful calculations in a second."
Written by: Christian Nordqvist