Medicare Part B: Enrollment and Premiums

Changes from June 15, 2021 to May 19, 2022

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Medicare Part B: Enrollment and Premiums
~~June 15, 2021~~May 19, 2022
Medicare is a federal insurance program that pays for covered health care services of Medicare is a federal insurance program that pays for covered health care services of
most individuals aged 65 and older and certain disabled persons. In calendar year most individuals aged 65 and older and certain disabled persons. In calendar year ~~2021~~2022, ,
Patricia A. Davis
the program is expected to cover about the program is expected to cover about ~~64 mil ion~~65 million persons at a total cost of $ persons at a total cost of $~~922 bil ion~~933 billion. .
Specialist in Health Care Specialist in Health Care
Most individuals (or their spouses) aged 65 and older who have worked in covered Most individuals (or their spouses) aged 65 and older who have worked in covered
Financing Financing
employment and paid Medicare payroll taxes for 40 quarters receive premium-free employment and paid Medicare payroll taxes for 40 quarters receive premium-free

Medicare Part A (Hospital Insurance). Those entitled to Medicare Part A (regardless of Medicare Part A (Hospital Insurance). Those entitled to Medicare Part A (regardless of

whether they are eligible whether they are eligible for premium-free Part A) have the option of enrolling in Part for premium-free Part A) have the option of enrolling in Part
B, which covers such things as physician and outpatient services and medical equipment. B, which covers such things as physician and outpatient services and medical equipment.
Beneficiaries have a seven-month initial enrollment period, and those who enroll in Part B after this initial Beneficiaries have a seven-month initial enrollment period, and those who enroll in Part B after this initial
enrollment period and/or reenroll after a termination of coverage may be subject to a enrollment period and/or reenroll after a termination of coverage may be subject to a late-enrollment penalty. This . This
penalty is equal to a 10% surcharge for each 12 months of delay in enrollment and/or reenrollment. Under penalty is equal to a 10% surcharge for each 12 months of delay in enrollment and/or reenrollment. Under ~~c ertain~~certain
conditions, some beneficiaries are exempt from the late-enrollment penalty; these exempt beneficiaries include conditions, some beneficiaries are exempt from the late-enrollment penalty; these exempt beneficiaries include
working individuals (and their spouses) with group coverage through their current employment, some working individuals (and their spouses) with group coverage through their current employment, some
international volunteers, and those granted “equitable relief.” international volunteers, and those granted “equitable relief.”
Whereas Part A is financed primarily by payroll taxes paid by current workers, Part B is financed through a Whereas Part A is financed primarily by payroll taxes paid by current workers, Part B is financed through a
combination of beneficiary premiums and federal general revenues. The standard Part B premiums are set to combination of beneficiary premiums and federal general revenues. The standard Part B premiums are set to
cover 25% of projected average per capita Part B program costs for the aged, with federal general revenues cover 25% of projected average per capita Part B program costs for the aged, with federal general revenues
accounting for the remaining amount. In general, if projected Part B costs increase or decrease, the premium rises accounting for the remaining amount. In general, if projected Part B costs increase or decrease, the premium rises
or or ~~fal s~~falls proportionately. However, some Part B proportionately. However, some Part B ~~enrol ees~~enrollees are protected by a provision in the Social Security Act are protected by a provision in the Social Security Act
(the (the hold-harmless provision) that prevents their Medicare Part B premiums from increasing more than the annual ) that prevents their Medicare Part B premiums from increasing more than the annual
increase in their Social Security benefit payments. This protection does not apply to four main groups of increase in their Social Security benefit payments. This protection does not apply to four main groups of
beneficiaries: low-income beneficiaries whose Part B premiums are paid by the Medicaid program; high-income beneficiaries: low-income beneficiaries whose Part B premiums are paid by the Medicaid program; high-income
beneficiaries who are subject to income-related Part B premiums; those whose Medicare premiums are not beneficiaries who are subject to income-related Part B premiums; those whose Medicare premiums are not
deducted from Social Security benefits; and new Medicare and Social Security enrollees. deducted from Social Security benefits; and new Medicare and Social Security enrollees.
Most Part B participants must pay monthly premiums, which do not vary with a beneficiary’s age, health status, Most Part B participants must pay monthly premiums, which do not vary with a beneficiary’s age, health status,
or place of residence. However, since 2007, higher-income enrollees pay higher premiums to cover a higher or place of residence. However, since 2007, higher-income enrollees pay higher premiums to cover a higher
percentage of Part B costs (“income-related monthly adjustment amounts” (IRMAA)). percentage of Part B costs (“income-related monthly adjustment amounts” (IRMAA)). ~~Additional y~~Additionally, certain low-, certain low-
income beneficiaries may qualify for Medicare cost-sharing and/or premium assistance from Medicaid through a income beneficiaries may qualify for Medicare cost-sharing and/or premium assistance from Medicaid through a
Medicare Savings Program. The premiums of those receiving benefits through Social Security are deducted from Medicare Savings Program. The premiums of those receiving benefits through Social Security are deducted from
their monthly payments. their monthly payments.
Each year, the Centers for Medicare & Medicaid Services (CMS) determines the Medicare Part B premiums for Each year, the Centers for Medicare & Medicaid Services (CMS) determines the Medicare Part B premiums for
the following year. The standard monthly Part B premium for the following year. The standard monthly Part B premium for ~~2021 is $148.50~~2022 is $170.10. However, in . However, in ~~2021~~2022, the hold-, the hold-
harmless provision applies to about harmless provision applies to about 21.5% of Part B enrollees, and these individuals pay lower premiums. (The % of Part B enrollees, and these individuals pay lower premiums. (The
premiums of those held harmless vary depending on the dollar amount of the increase in their Social Security premiums of those held harmless vary depending on the dollar amount of the increase in their Social Security
benefits.) Higher-income beneficiaries, currently defined as individuals with incomes over $benefits.) Higher-income beneficiaries, currently defined as individuals with incomes over $8891,000 per year or ,000 per year or
couples with incomes over $couples with incomes over $~~176~~182,000 per year, pay $,000 per year, pay $~~207.90, $297.00, $386.10, $475.20, or $504.90~~238.10, $340.20, $442.30, $544.30, or $578.30 per month, per month,
depending on their income levels. depending on their income levels.
Current issues related to the Part B premium that may come before Congress include the amount of the premium Current issues related to the Part B premium that may come before Congress include the amount of the premium
and its rate of increase (and the potential net impact on Social Security benefits), the impact of the hold-harmless and its rate of increase (and the potential net impact on Social Security benefits), the impact of the hold-harmless
provision on those not held harmless, modifications to the late-enrollment penalty, and possible increases in provision on those not held harmless, modifications to the late-enrollment penalty, and possible increases in
Medicare premiums as a means to reduce federal spending and deficits. Medicare premiums as a means to reduce federal spending and deficits.
Congressional Research Service Congressional Research Service

Medicare Part B: Enrollment and Premiums

Introduction
Medicare is a federal insurance program that pays for covered health care services of most Medicare is a federal insurance program that pays for covered health care services of most
individualsindividuals aged 65 and older and certain disabled persons. Medicare serves approximately one in aged 65 and older and certain disabled persons. Medicare serves approximately one in
six Americans and six Americans and ~~virtual y al~~ virtually all of the population aged 65 and over. In calendar year (CY) of the population aged 65 and over. In calendar year (CY) ~~2021~~2022, ,
the program is expected to cover about the program is expected to cover about ~~64 mil ion~~65 million persons at a total cost of about $ persons at a total cost of about $~~922 bil ion~~933 billion, ,
accounting for approximately accounting for approximately 4% of gross domestic product.1 The Medicare program is % of gross domestic product.1 The Medicare program is
administered by the Centers for Medicare & Medicaid Services (CMS) within the Department of administered by the Centers for Medicare & Medicaid Services (CMS) within the Department of
Health and Human Services (HHS), and individualsHealth and Human Services (HHS), and individuals enroll in Medicare through the Social enroll in Medicare through the Social
Security Administration (SSA). Security Administration (SSA).
Medicare consists of four parts—Parts A through D. Part A covers hospital services, Medicare consists of four parts—Parts A through D. Part A covers hospital services, ~~skil ed~~skilled
nursing facility services, home health visits, and hospice services. Part B covers a broad range of nursing facility services, home health visits, and hospice services. Part B covers a broad range of
medical services and supplies, including physician services, laboratory services, durable medical medical services and supplies, including physician services, laboratory services, durable medical
equipment, and outpatient hospital services. Enrollment in Part B is voluntary; however, most equipment, and outpatient hospital services. Enrollment in Part B is voluntary; however, most
Medicare beneficiaries (about 91%) are enrolled in Part B.Medicare beneficiaries (about 91%) are enrolled in Part B.2 Part C (Medicare Advantage) provides Part C (Medicare Advantage) provides
private plan options, such as managed care, for beneficiaries who are enrolled in both Part A and private plan options, such as managed care, for beneficiaries who are enrolled in both Part A and
Part B. Part D provides optional outpatient prescription drug coverage.Part B. Part D provides optional outpatient prescription drug coverage.2
3 Each part of Medicare is funded differently. Each part of Medicare is funded differently.34 Part A is financed primarily through payroll taxes Part A is financed primarily through payroll taxes
imposed on current workers (2.9% of earnings, shared imposed on current workers (2.9% of earnings, shared ~~equal y~~equally between employers and workers), between employers and workers),
which are credited to the Hospital Insurance (HI) Trust Fund. Beginning in 2013, workers with which are credited to the Hospital Insurance (HI) Trust Fund. Beginning in 2013, workers with
annual wages over $200,000 for single tax filers or $250,000 for joint filers pay an additional annual wages over $200,000 for single tax filers or $250,000 for joint filers pay an additional
0.9%0.9%~~.4 Beneficiaries general y~~ on earnings over those amounts.5 Beneficiaries generally do not pay premiums for Part A. do not pay premiums for Part A. In 2022~~In 2021~~, total Part A expenditures , total Part A expenditures
are expected to reach about $are expected to reach about $~~372 bil ion~~364 billion, representing about , representing about 4039% of program costs.% of program costs.56 Parts B and Parts B and
D, the voluntary portions, are funded through the Supplementary Medical Insurance (SMI) Trust D, the voluntary portions, are funded through the Supplementary Medical Insurance (SMI) Trust
Fund, which is financed primarily by general revenues (transfers from the U.S. Treasury) and Fund, which is financed primarily by general revenues (transfers from the U.S. Treasury) and
premiums paid by enrollees. In premiums paid by enrollees. In ~~2021~~2022, about $2.8 , about $2.8 ~~bil ion~~billion in fees on manufacturers and importers of in fees on manufacturers and importers of
brand-name prescription drugs also brand-name prescription drugs also ~~wil~~ will be used to supplement the SMI Trust Fund.be used to supplement the SMI Trust Fund.67 In In ~~2021~~2022, Part , Part
B expenditures are expected to reach about B expenditures are expected to reach about ~~$434 bil ion~~$452 billion, and Part D expenditures are expected to , and Part D expenditures are expected to
reach about $reach about $~~116 bil ion~~120 billion, representing about , representing about 4748% and 13% of program costs, respectively. (Part C % and 13% of program costs, respectively. (Part C
is financed proportionately through the HI and SMI Trust Funds; expenditures for Parts A and B is financed proportionately through the HI and SMI Trust Funds; expenditures for Parts A and B
services provided under Part C are included in the above expenditure figures.) services provided under Part C are included in the above expenditure figures.)

1 Expenditure estimates from Boards of 1 Expenditure estimates from Boards of ~~T rustees~~Trustees, Federal Hospital Insurance and Federal Supplementary Medical , Federal Hospital Insurance and Federal Supplementary Medical
Insurance Insurance ~~T rust~~Trust Funds, Funds, ~~2020~~2021 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal
~~Supplem entary~~Supplementary Medical Insurance Trust Funds, , ~~April 22, 2020~~August 31, 2021, at https://www.cms.gov/Research-Statistics-Data-and-, at https://www.cms.gov/Research-Statistics-Data-and-
Systems/Statistics-Systems/Statistics-~~T rends~~Trends-and-Reports/ReportsTrustFunds/index.html. (Hereinafter, -and-Reports/ReportsTrustFunds/index.html. (Hereinafter, ~~2020 Medicare T rustees Report.)~~
~~T hese projections do not take into account the potential effects of the Coronavirus Disease 2019 (COVID-19) public~~
~~health emergency.~~
2the 2021 Medicare Trustees Report.) 2 Data provided by the Centers for Medicare & Medicaid Services (CMS), April 2022. 3 For additional information on the Medicare program, see CRS For additional information on the Medicare program, see CRS Report R40425, Report R40425, Medicare Primer. .
~~3 See CRS~~ 4 See CRS Report R43122, Report R43122, Medicare Financial Status: In Brief. .
45 See See Internal Revenue Service, Internal Revenue Service, Questions and Answers for the Additional Medicare Tax, at http://www.irs.gov/, at http://www.irs.gov/
Businesses/Small-Businesses-&-Self-Employed/Questions-and-Answers-for-the-Additional-Medicare-Businesses/Small-Businesses-&-Self-Employed/Questions-and-Answers-for-the-Additional-Medicare-~~T ax~~Tax. .
56 All expenditure data are from the All expenditure data are from the ~~2020~~2021 Medicare Medicare ~~T rustees~~Trustees Report. Report. ~~T he~~The estimates do not reflect the potential impact of estimates do not reflect the potential impact of
~~the COVID-19 pandemic on Medicare spending or the impact of~~ related legislation enacted since the time of that related legislation enacted since the time of that
~~report.~~
~~6 Centers for Medicare & Medicaid Services (CMS),~~ report. 7 CMS, “Medicare Program: Medicare Part B Monthly Actuarial Rates, “Medicare Program: Medicare Part B Monthly Actuarial Rates,
Premium Rate, and Annual DeductiblePremium Rate, and Annual Deductible ~~Beginning~~ Beginning January 1, January 1, ~~2021,” 85~~2022,” 86 Federal Register ~~71904~~64205, November , November ~~12, 2020~~17, 2021, at https://www.govinfo.gov/content/pkg/FR-2021-11-17/pdf/2021-25050.pdf. .
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Part B beneficiary premiums are Part B beneficiary premiums are ~~normal y~~normally set at a rate each year equal to 25% of average set at a rate each year equal to 25% of average
expected per capita Part B program costs for the aged for the year.expected per capita Part B program costs for the aged for the year.78 Higher-income enrollees pay Higher-income enrollees pay
higher premiums set to cover a greater percentage of Part B costs,higher premiums set to cover a greater percentage of Part B costs,89 while those with low incomes while those with low incomes
may qualify for premium assistance through one of several Medicare Savings Programs may qualify for premium assistance through one of several Medicare Savings Programs
administered by Medicaid.administered by Medicaid.910 Individuals who receive Social Security or Railroad Retirement Individuals who receive Social Security or Railroad Retirement
Board (RRB) retirement or disabilityBoard (RRB) retirement or disability benefits have their Part B premiums benefits have their Part B premiums ~~automatical y~~automatically deducted deducted
from their benefit checks. Part B premiums are from their benefit checks. Part B premiums are ~~general y~~generally announced in the announced in the ~~fal~~ fall prior to the year prior to the year
that they are in effect (e.g., the that they are in effect (e.g., the ~~2021~~2022 Part B premiums were announced in November Part B premiums were announced in November ~~2020).10 In~~
~~2021~~2021).11 In 2022, the standard monthly Part B premium is $, the standard monthly Part B premium is $~~148.50.11~~170.10.12 However, in However, in ~~2021~~2022, about , about 21.5% of Part B % of Part B
enrollees are protected by a enrollees are protected by a hold-harmless provision in the Social Security Act that prevents their in the Social Security Act that prevents their
Medicare Part B premiums from increasing more than the annual dollar amount of the increase in Medicare Part B premiums from increasing more than the annual dollar amount of the increase in
their Social Security benefit payments. These individuals pay premiums of less than $their Social Security benefit payments. These individuals pay premiums of less than $~~148.50.12~~
~~2021~~170.10.13 2022 Medicare Part B Premiums
Beneficiaries Who File an
Beneficiaries Who File a
Individual Tax Return with
Joint Tax Return with
Monthly
Income:
Income:
Premium
Less Less than or equal to $than or equal to $8891,000 ,000
Less Less than or equal to $than or equal to $~~176~~182,000 ,000
$ $~~148.50~~170.10
Greater Greater than $than $8891,000 and less than or ,000 and less than or
Greater Greater than $than $~~176~~182,000 and less ,000 and less
equal to $ equal to $~~111~~114,000 ,000
than or equal to $ than or equal to $~~222~~228,000 ,000
~~207.90~~238.10
Greater Greater than $than $~~111~~114,000 and less than ,000 and less than
Greater Greater than $than $~~222~~228,000 and less ,000 and less
or equal to $ or equal to $~~138~~142,000 ,000
than or equal to $ than or equal to $~~276~~284,000 ,000
~~297.00~~340.20
Greater Greater than $than $~~138~~142,000 and less than ,000 and less than
Greater Greater than $than $~~276~~284,000 and less ,000 and less
or equal to $ or equal to $~~165~~170,000 ,000
than or equal to $ than or equal to $~~330~~340,000 ,000
~~386.10~~442.30
Greater Greater than $than $~~165~~170,000 and less than ,000 and less than
Greater Greater than $than $~~330~~340,000 and less ,000 and less
$500,000 $500,000
than $750,000 than $750,000
~~475.20~~544.30
Greater Greater than or equal to than or equal to
Greater Greater than or equal to $500,000 than or equal to $500,000
$750,000 $750,000
~~504.90~~578.30
Source: Centers for Medicare & Medicaid Services Centers for Medicare & Medicaid Services (CMS), Fact Sheet, “(CMS), Fact Sheet, “~~2021~~2022 Medicare Parts A & B Medicare Parts A & B
PremiumsPremiums and Deductibles,” Novemberand Deductibles,” November ~~6, 2020~~ 12, 2021. .
In addition to premiums, Part B beneficiaries may pay other out-of-pocket costs when they use In addition to premiums, Part B beneficiaries may pay other out-of-pocket costs when they use
services. The annual deductible for Part B services is $services. The annual deductible for Part B services is $~~203~~233.00 in .00 in ~~2021.13~~2022.14 After the annual After the annual

~~7 In 2021~~ 8 In 2022, beneficiary premiums are expected to cover about , beneficiary premiums are expected to cover about ~~15.0~~16.1% of the costs of “traditional” Medicare (Parts A and % of the costs of “traditional” Medicare (Parts A and
B combined), B combined), 1415.5% from Part B premiums, and.5% from Part B premiums, and 0.6% from voluntary Part A premiums. 0.6% from voluntary Part A premiums. See Appe ndix ESee Appendix F for for
information on Part A premiums. information on Part A premiums.
8 9 Depending on their income, beneficiaries subject Depending on their income, beneficiaries subject to income-related monthly adjustments pay a total monthly premium to income-related monthly adjustments pay a total monthly premium
of 35%, 50%, 65%, 80%, or 85% of expected per capita Part B costs for the aged.of 35%, 50%, 65%, 80%, or 85% of expected per capita Part B costs for the aged. ~~See~~ “ See “Income-Related Premium.”
~~9 See~~ .” 10 See “Premium Assistance for Low-Income Beneficiaries.”
1011 CMS, CMS, Fact Sheet, “Fact Sheet, “~~2021~~2022 Medicare Parts A & B Medicare Parts A & B Premiums and Deductibles,”Premiums and Deductibles,” November November ~~6, 2020~~12, 2021, at , at
https://www.cms.gov/newsroom/fact-sheets/https://www.cms.gov/newsroom/fact-sheets/~~2021~~2022-medicare-parts-b-premiums-and--medicare-parts-b-premiums-and-~~deductibles.~~
~~11 CMS,~~ deductibles2022-medicare-part-d-income-related-monthly-adjustment. 12 CMS, “Medicare Program: Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible “Medicare Program: Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible
BeginningBeginning January 1, January 1, ~~2021,” 85~~2022,” 86 Federal Register ~~71904~~64205, November , November ~~12, 2020~~17, 2021, at https://www., at https://www.~~federalregister~~govinfo.gov/content/pkg/FR-2021-11-17/pdf/2021-25050.pdf. 13 Data provided by CMS, April 2022. The~~.gov/~~
~~documents/2020/11/12/2020-25029/medicare-program-medicare-part-b-monthly-actuarial-rates-premium-rates-and-~~
~~annual-deductible.~~
~~12 Data provided by CMS, May 2021. T he~~ premiums of those held harmless vary depending on the dollar amount of the premiums of those held harmless vary depending on the dollar amount of the
increase in their Socialincrease in their Social Security benefits. SeeSecurity benefits. See “ “Protection of Social Security Benefits from Increases in Medicare Part B
Premiums.”
13 14 Annual increases in the deductibles Annual increases in the deductibles are not protected by the hold-harmless provision. are not protected by the hold-harmless provision.
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deductible is met, beneficiaries are responsible for coinsurance costs, which are deductible is met, beneficiaries are responsible for coinsurance costs, which are ~~general y~~generally 20% of 20% of
Medicare-approved Part B expenses. Medicare-approved Part B expenses.
This report provides an overview of Medicare Part B premiums, including information on Part B This report provides an overview of Medicare Part B premiums, including information on Part B
~~eligibility~~ eligibility and enrollment, late-enrollment penalties, collection of premiums, determination of and enrollment, late-enrollment penalties, collection of premiums, determination of
annual premium amounts, premiums for high-income annual premium amounts, premiums for high-income ~~enrol ees~~enrollees, premium assistance for low-, premium assistance for low-
income enrollees, protections for Social Security recipients from rising Part B premiums, and income enrollees, protections for Social Security recipients from rising Part B premiums, and
historical Medicare Part B premium trends. This report also provides a summary of various historical Medicare Part B premium trends. This report also provides a summary of various
premium-related issues that may be of interest to Congress. Specific Medicare and Social premium-related issues that may be of interest to Congress. Specific Medicare and Social
Security publications and other resources for beneficiaries, and those who provide assistance to Security publications and other resources for beneficiaries, and those who provide assistance to
them, are cited where appropriate. them, are cited where appropriate.
Medicare Part B Eligibility and Enrollment
An individualAn individual (or the spouse of an individual) who has worked in covered employment and paid (or the spouse of an individual) who has worked in covered employment and paid
Medicare payroll taxes for 40 quarters is entitled to receive premium-free Medicare Part A Medicare payroll taxes for 40 quarters is entitled to receive premium-free Medicare Part A
benefits upon reaching the age of 65.benefits upon reaching the age of 65.1415 Those who have paid in for fewer than 40 quarters may Those who have paid in for fewer than 40 quarters may
enroll in Medicare Part A by paying a premium.enroll in Medicare Part A by paying a premium.~~15 Al~~ 16 All persons entitled to Part A (regardless of persons entitled to Part A (regardless of
whether they are eligiblewhether they are eligible for premium-free Part A) are also entitled to enroll in Part B. An aged for premium-free Part A) are also entitled to enroll in Part B. An aged
person not entitled to Part A may enroll in Part B if he or she is aged 65 or over and either a U.S. person not entitled to Part A may enroll in Part B if he or she is aged 65 or over and either a U.S.
citizen or an aliencitizen or an alien lawfully admitted for permanent residence who has resided in the United States lawfully admitted for permanent residence who has resided in the United States
continuously for the immediately preceding five years. continuously for the immediately preceding five years.
Those who are receiving Social Security or RRB benefits are Those who are receiving Social Security or RRB benefits are ~~automatical y~~automatically enrolled in Medicare, enrolled in Medicare,
and coverage begins the first day of the month they turn 65.and coverage begins the first day of the month they turn 65.1617 These individuals These individuals ~~wil~~ will receive a receive a
Medicare card and a “Welcome to Medicare” package about three months before their 65th Medicare card and a “Welcome to Medicare” package about three months before their 65th
birthday.birthday.1718 Those who are Those who are ~~automatical y~~automatically enrolled in Medicare Part A also are enrolled in Medicare Part A also are ~~automatical y~~automatically
enrolled in Part B.enrolled in Part B.1819 However, because beneficiaries must pay a premium for Part B coverage, However, because beneficiaries must pay a premium for Part B coverage,
they have the option of turning it down.they have the option of turning it down.1920 Disabled persons who have received cash payments for Disabled persons who have received cash payments for

~~14 See CMS, “~~ 15 See CMS, “Original Medicare (Part A and B) Eligibility and EnrollmentOriginal Medicare (Part A and B) Eligibility and Enrollment ,” at https://www.cms.gov/Medicare/,” at https://www.cms.gov/Medicare/
Eligibility-and-Enrollment/OrigMedicarePartABEligEnrol. Eligibility-and-Enrollment/OrigMedicarePartABEligEnrol.
1516 For additional information on Part A premiums, For additional information on Part A premiums, seesee Appendix EF.
1617 For additional information on enrolling in Medicare Parts A and B, see Medicare publication “Enrolling in Medicare For additional information on enrolling in Medicare Parts A and B, see Medicare publication “Enrolling in Medicare
Part A & Part B,” at https://www.medicare.gov/Pubs/pdf/11036-Enrolling-Medicare-Part-A-Part-B.pdf. Part A & Part B,” at https://www.medicare.gov/Pubs/pdf/11036-Enrolling-Medicare-Part-A-Part-B.pdf.
1718 See See “‘Welcome to Medicare’ package (automatically enrolled),” at https://www.medicare.gov/forms-help-resources/“‘Welcome to Medicare’ package (automatically enrolled),” at https://www.medicare.gov/forms-help-resources/
mail-you-get-about-medicare/welcome-to-medicare-package-automatically-enrolled. When first becoming eligiblemail-you-get-about-medicare/welcome-to-medicare-package-automatically-enrolled. When first becoming eligible for for
Medicare, beneficiaries need to make a number of choices regardingMedicare, beneficiaries need to make a number of choices regarding the benefits they wish to sign up for and how they the benefits they wish to sign up for and how they
wishwish to receive them. For example, new enrollees need to decideto receive them. For example, new enrollees need to decide whether they wish to remain in traditional Medicare whether they wish to remain in traditional Medicare
(Parts A and B, the default option) or if they would like to receive their A and B benefits through a private Medicare (Parts A and B, the default option) or if they would like to receive their A and B benefits through a private Medicare
Advantage Plan (Part C). Additionally, beneficiaries need to decide whether they wouldAdvantage Plan (Part C). Additionally, beneficiaries need to decide whether they would like to sign uplike to sign up for an outpatient for an outpatient
prescription drug plan (Part D). prescription drug plan (Part D). ~~T hese opt ions~~These options are described in the “ are described in the “ Welcome to Medicare” package. For free Welcome to Medicare” package. For free
personalized health insurance counseling, beneficiariespersonalized health insurance counseling, beneficiaries may contact their local State Health Insurance Assistance may contact their local State Health Insurance Assistance
Programs (SHIPs); contact information may be found at http://www.medicare.gov/contacts/ and https://acl.gov/Programs (SHIPs); contact information may be found at http://www.medicare.gov/contacts/ and https://acl.gov/
programs/connecting-people-services/state-health-insurance-assistance-program-ship. programs/connecting-people-services/state-health-insurance-assistance-program-ship.
~~18 T hose~~19 Those who live in Puerto Rico are not automatically enrolled in Medicare Part B. who live in Puerto Rico are not automatically enrolled in Medicare Part B. ~~T hey~~They need to sign up for Part B need to sign up for Part B
duringduring the initial enrollment period or possibly bethe initial enrollment period or possibly be ~~subject to a~~ subject to a late-enrollment penalty. See archived CRS penalty. See archived CRS Report R44275, Report R44275, Puerto Rico
and Health Care Finance: Frequently Asked Questions, and Social, and Social ~~Security~~ Security Administration (SSA) Publication Administration (SSA) Publication
“Medicare in Puerto Rico,” at http://www.socialsecurity.gov/pubs/EN-05-10521.pdf. “Medicare in Puerto Rico,” at http://www.socialsecurity.gov/pubs/EN-05-10521.pdf. ~~T he following bills,~~ As introduced in introduced in
~~the 116th Congress, would have extended this automatic enrollment to residents of Puert o Rico: the Fairness in~~
~~Medicare Part B Enrollment Act of 2019 (H.R. 2310), and the T erritories Health Equity Act of 2019 (H.R. 1354 and S.~~
~~1773).~~
~~19 Should a beneficiary decline Part B coverage, a new Medicare card will be issued~~ the 117th Congress, H.R. 2713 and S. 1228 would extend this automatic enrollment to residents of Puerto Rico; and, H.R. 1826 and H.R. 3434 would eliminate Part B late-enrollment penalties for Puerto Rico residents who enroll within five years of becoming entitled to Part A. 20 Should a beneficiary decline Part B coverage, a new Medicare card will be issued that indicates that the beneficiary that indicates that the beneficiary
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24 months under the Social Security or RRB disability 24 months under the Social Security or RRB disability programs also programs also ~~automatical y~~automatically receive a receive a
Medicare card and are enrolled in Part B unless they Medicare card and are enrolled in Part B unless they ~~specifical y~~specifically decline such coverage. decline such coverage.2021 Those Those
who choose to receive coverage through a Medicare Advantage plan (Part C) must enroll in who choose to receive coverage through a Medicare Advantage plan (Part C) must enroll in
Part B. Part B.
Those who are not receiving Social Security or RRB benefits, for example because they are Those who are not receiving Social Security or RRB benefits, for example because they are ~~stil~~
~~working21~~still working22 or have chosen to defer enrollment because they have not yet reached their full or have chosen to defer enrollment because they have not yet reached their full
retirement benefit eligibilityretirement benefit eligibility age,age,2223 must file an application with the SSA or RRB for Medicare must file an application with the SSA or RRB for Medicare
benefits.benefits.2324 There are two kinds of enrollment periods, one that occurs when individuals are There are two kinds of enrollment periods, one that occurs when individuals are
~~initial y eligible~~ initially eligible for Medicare and one annual general enrollment period for those who missed for Medicare and one annual general enrollment period for those who missed
signing up during their initialsigning up during their initial enrollment period. A beneficiary may drop Part B enrollment and enrollment period. A beneficiary may drop Part B enrollment and
reenroll an unlimited number of times; however, premium penalties may be incurred. reenroll an unlimited number of times; however, premium penalties may be incurred.
Initial Enrollment Periods
Those who are not Those who are not ~~automatical y~~automatically enrolled in Medicare may sign up during a certain period when enrolled in Medicare may sign up during a certain period when
they first become eligible. The they first become eligible. The initial enrollment period is seven months long and begins three period is seven months long and begins three
months before the month in which the individual first turns 65. (Semonths before the month in which the individual first turns 65. (See Table 1.) Beneficiaries who ) Beneficiaries who
do not file an application for Medicare benefits during their initialdo not file an application for Medicare benefits during their initial enrollment period could be enrollment period could be
subject to the Part B late-enrollment penalty. (See subject to the Part B late-enrollment penalty. (See “Late-Enrollment Premium Penalty and
Exemptions.””) If an individual accepts the automatic enrollment in Medicare Part B, or enrolls in ) If an individual accepts the automatic enrollment in Medicare Part B, or enrolls in
Medicare Part B during the first three months of the initial enrollment period, coverage Medicare Part B during the first three months of the initial enrollment period, coverage ~~wil~~ will start start
with the month in which an individual is first eligible,with the month in which an individual is first eligible, that is, the month of the individual’s 65th that is, the month of the individual’s 65th
birthday. Those who enroll during the last four months birthday. Those who enroll during the last four months ~~wil~~ will have their coverage start date delayed have their coverage start date delayed
from one to three months after enrollment.from one to three months after enrollment.2425 The initial enrollment period of those eligible The initial enrollment period of those eligible ~~for~~

~~has Part A coverage only. (In the 117th Congress, H.R. 1826 would eliminate Part B late-enrollment penalties for~~
~~Puerto Rico residents who enroll within five years of becoming entitled to Part A.)~~
~~20 Individuals~~ for has Part A coverage only. 21 Individuals with Amyotrophic Lateral Sclerosis are not subject to the 24with Amyotrophic Lateral Sclerosis are not subject to the 24 -month waiting period; for these individuals -month waiting period; for these individuals
Medicare coverage beginsMedicare coverage begins the first day of the month during which disabilitythe first day of the month during which disability ~~benefits st art~~ benefits start. Additionally, the Medicare . Additionally, the Medicare
coverage period for persons diagnosedcoverage period for persons diagnosed with end-stage renal diseasewith end-stage renal disease generally beginsgenerally begins in the third month after the month in the third month after the month
when dialysiswhen dialysis begins.begins.
21 22 For additional information, see CMS, “Employer Community: Information about Medicare Enrollment,” at For additional information, see CMS, “Employer Community: Information about Medicare Enrollment,” at
https://www.cms.gov/Outreach-and-Education/Find-Your-Provider-https://www.cms.gov/Outreach-and-Education/Find-Your-Provider-~~T ype~~Type/Employers-and-Unions/Employer-/Employers-and-Unions/Employer-
community.html. community.html.
2223 In the past, individuals In the past, individuals generally were eligiblegenerally were eligible to receive both full Socialto receive both full Social Security retirement benefits and Medicare Security retirement benefits and Medicare
coverage starting at the age of 65. However, the age to receive full retirement benefits has changed for some people, coverage starting at the age of 65. However, the age to receive full retirement benefits has changed for some people,
dependingdepending on the year they were born. For example, those turning 65 in on the year they were born. For example, those turning 65 in ~~2021~~2022 will will not be eligiblenot be eligible for full Social for full Social
Security benefits until the age of 66 and Security benefits until the age of 66 and 46 months. See https://www.ssa.gov/benefits/retirement/planner/ months. See https://www.ssa.gov/benefits/retirement/planner/
agereduction.html. agereduction.html.
~~23 T o~~ 24 To apply, individuals apply, individuals can call or visit their local Social Securitycan call or visit their local Social Security office or call Socialoffice or call Social Security at 1-800-772-1213. Security at 1-800-772-1213.
Some people also may apply online if they meet certain rules, at https://www.ssa.gov/benefits/medicare/.Some people also may apply online if they meet certain rules, at https://www.ssa.gov/benefits/medicare/. For Railroad For Railroad
Retirement Board (RRB)Retirement Board (RRB) retirees, application information may be found at https://www.rrb.gov/Benefits/Medicare.retirees, application information may be found at https://www.rrb.gov/Benefits/Medicare. See See
also SSA,also SSA, “Apply Online For Medicare“Apply Online For Medicare ~~In Less T han 10 Minutes~~—Even If You Are Not Ready —Even If You Are Not Ready ~~T o~~To Retire,” at Retire,” at
http://www.socialsecurity.gov/pubs/EN-05-10530.pdf, and SSA,http://www.socialsecurity.gov/pubs/EN-05-10530.pdf, and SSA, “ “How to Apply Online for MedicareHow to Apply Online for Medicare Only,” at Only,” at
http://www.socialsecurity.gov/pubs/EN-05-10531.pdf. http://www.socialsecurity.gov/pubs/EN-05-10531.pdf.
2425 An eligibility, An eligibility, enrollment date, and premium calculator may beenrollment date, and premium calculator may be found on the Medicare.govfound on the Medicare.gov ~~website~~ website at at
https://www.medicare.gov/eligibilitypremiumcalc/.https://www.medicare.gov/eligibilitypremiumcalc/. ~~T he~~ The Consolidated Appropriations Act, 2021 (P.L. 116-260; Consolidated Appropriations Act, 2021 (P.L. 116-260;
Division CC, §102) eliminates these delaysDivision CC, §102) eliminates these delays starting instarting in 2023. For initial enrollment periods occurring in 2023 and 2023. For initial enrollment periods occurring in 2023 and
subsequentsubsequent years, coverage willyears, coverage will ~~begin~~ begin the first day of the month after the month of enrollment for enrollments the first day of the month after the month of enrollment for enrollments
occurring duringoccurring during any of the seven months of the initial enrollment period. any of the seven months of the initial enrollment period.
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Medicare based on disability Medicare based on disability or permanent kidney failure is linked to the date the disability or or permanent kidney failure is linked to the date the disability or
treatment began.treatment began.2526
Table 1. Initial Enrollment Period
(month of (month of ~~enrol ment and ef ective~~enrollment and effective dates) dates)
Up to 3 Months After
3 Months Before the
The Month During
the Month One Turns

Month One Turns 65
Which One Turns 65
65a
Effective Dates
If one signs up during the If one signs up during the
If one enrol s If one enrol s during one’sduring one’s
The start date would be The start date would be
first 3 months of one’s first 3 months of one’s
birthday month, the start birthday month, the start
delayed if one enrol s delayed if one enrol s
initial enrol ment initial enrol ment period, period,
date wil be the 1st day of date wil be the 1st day of
during the last 3 months during the last 3 months
Part B coverage starts the the next month. Part B coverage starts the the next month.
of the initial enrol ment of the initial enrol ment
1st day of one’s birthday 1st day of one’s birthday
period. period.
~~month.b~~
month.b  
If one signs up in the If one signs up in the
month after the month after the
month one turns 65, month one turns 65,
coverage starts 2 coverage starts 2
months after months after
enrol ment. enrol ment.
 
If one signs up 2 or 3 If one signs up 2 or 3
months after the months after the
month one turns 65, month one turns 65,
coverage starts 3 coverage starts 3
months after months after
enrol ment. enrol ment.
Example for Someone
If one enrol s If one enrol s in March, in March,
If one enrol s If one enrol s in June, in June,
 
If one enrol s If one enrol s in July, in July,
Turning 65 During the
April, April, or May, coverage or May, coverage
coverage begins July 1. coverage begins July 1.
coverage begins coverage begins
Month of June
begins June 1. begins June 1.
September September 1. 1.
(The seven-month initial (The seven-month initial
 
If one enrol s If one enrol s in in
enrol ment enrol ment period would period would
August, coverage August, coverage
run from March 1 run from March 1
begins November begins November 1. 1.
through September through September 30.) 30.)
 
If one enrol s If one enrol s in in
September,September, coverage coverage
begins Decemberbegins December 1. 1.
Source: Table prepared by CRS based on Social Security Administration,Table prepared by CRS based on Social Security Administration, “Medicare,” Publication No.“Medicare,” Publication No. 05-10043, 05-10043,
at https://www.ssa.gov/pubs/EN-05-10043.pdf. at https://www.ssa.gov/pubs/EN-05-10043.pdf.
a. Starting in 2023, per changes made by the Consolidated Appropriations Act, 2021 (a. Starting in 2023, per changes made by the Consolidated Appropriations Act, 2021 ( ~~P.L. 116-260~~; Division ; Division
CC, §102), the CC, §102), the coverage delays for enrol mentcoverage delays for enrol ment during the last three months of the initial enrol mentduring the last three months of the initial enrol ment period period
~~wil~~ wil be eliminated,be eliminated, and coverage wiland coverage wil be effective the first day of the month fol owing the month of be effective the first day of the month fol owing the month of
enrol mentenrol ment for enrol mentsfor enrol ments during any of the last four months of the initial enrol mentduring any of the last four months of the initial enrol ment period. period.
b. If one’s birthday b. If one’s birthday ~~fal s~~falls on the 1st of the month, then the enrol ment on the 1st of the month, then the enrol ment period starts a month earlierperiod starts a month earlier and and
coverage may begin on the 1st day of the month prior coverage may begin on the 1st day of the month prior to one’s birthday month.to one’s birthday month.
General Enrollment Period
An individualAn individual who does not sign up for Medicare during the initialwho does not sign up for Medicare during the initial enrollment period must wait enrollment period must wait
until the next until the next general enrollment period. In addition, persons who decline Part B coverage when period. In addition, persons who decline Part B coverage when
first eligible,first eligible, or terminate Part B coverage, must also wait until the next general enrollment period or terminate Part B coverage, must also wait until the next general enrollment period

25 26 For additional information on Medicare eligibility for the disabled, For additional information on Medicare eligibility for the disabled, ~~see CRS~~ see CRS Report RS22195, Report RS22195, Social Security
Disability Insurance (SSDI) and Medicare: The 24-Month Waiting Period for SSDI Beneficiaries Under Age 65 . .
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to enroll or reenroll. The general enrollment period lasts for three months from January 1 to to enroll or reenroll. The general enrollment period lasts for three months from January 1 to
March 31 of each year, with coverage beginning on July 1 of that year.March 31 of each year, with coverage beginning on July 1 of that year.2627 A late-enrollment A late-enrollment
penalty may apply.penalty may apply.2728 (See (See “Late-Enrollment Premium Penalty and Exemptions” ” below.) below.)
Special Enrollment Periods
Certain individuals may be eligibleCertain individuals may be eligible to enroll in Medicare Part B during specific timeframes to enroll in Medicare Part B during specific timeframes
outside of their initialoutside of their initial enrollment period or the annual general enrollment period. For example, a enrollment period or the annual general enrollment period. For example, a
working individual and/or the spouse of a working individual may be able to delay enrollment in working individual and/or the spouse of a working individual may be able to delay enrollment in
Medicare Part BMedicare Part B and enroll during a special enrollment period (SEP) without being subject to the and enroll during a special enrollment period (SEP) without being subject to the
late-enrollment penalty. Delayed enrollment is permitted when an individuallate-enrollment penalty. Delayed enrollment is permitted when an individual aged 65 or older has aged 65 or older has
group health insurance coverage based on the individual’s (or spouse’s) current employment group health insurance coverage based on the individual’s (or spouse’s) current employment
(with an employer with 20 or more employees). (In (with an employer with 20 or more employees). (In ~~2020~~2021, about 2., about 2.~~2 mil ion~~1 million of the 3. of the 3.~~8 mil ion~~
~~working aged population~~7 million of those aged 65 and over and still working were enrolled in Part A only, with most of the rest enrolled in both Parts were enrolled in Part A only, with most of the rest enrolled in both Parts
A and B.)A and B.)2829 Delayed enrollment is also permitted for certain disabled persons who have group Delayed enrollment is also permitted for certain disabled persons who have group
health insurance coverage based on their own or a family member’s current employment with a health insurance coverage based on their own or a family member’s current employment with a
large group health plan. For the disabled, a large group health plan is defined as one that covers large group health plan. For the disabled, a large group health plan is defined as one that covers
100 or more employees. 100 or more employees.
~~Specifical y~~Specifically, persons permitted to delay coverage without penalty are those persons whose , persons permitted to delay coverage without penalty are those persons whose
Medicare benefits are determined under the Medicare Secondary Payer program.Medicare benefits are determined under the Medicare Secondary Payer program.2930 Under Under
Medicare Secondary Payer rules, an employer (with 20 or more employees) is required to offer Medicare Secondary Payer rules, an employer (with 20 or more employees) is required to offer
workers aged 65 and over (and workers’ spouses aged 65 and over) the same group health workers aged 65 and over (and workers’ spouses aged 65 and over) the same group health
insurance coverage that is made available to other employees.insurance coverage that is made available to other employees.3031 The worker has the option of The worker has the option of
accepting or rejecting the employer’s coverage. If he or she accepts the coverage, the employer accepting or rejecting the employer’s coverage. If he or she accepts the coverage, the employer
plan is primary (i.e., pays benefits first) for the worker and/or spouse aged 65 or over, and plan is primary (i.e., pays benefits first) for the worker and/or spouse aged 65 or over, and
Medicare becomes the secondary payer (i.e., Medicare becomes the secondary payer (i.e., ~~fil s~~fills in the gaps in the employer plan, up to the limits in the gaps in the employer plan, up to the limits
of Medicare’s coverage). Similarly, a group health plan offered by an employer with 100 or more of Medicare’s coverage). Similarly, a group health plan offered by an employer with 100 or more
employees is the primary payer for its employees under 65 years of age, or their dependents, who employees is the primary payer for its employees under 65 years of age, or their dependents, who
are entitled to Medicare because of disability.are entitled to Medicare because of disability.31

2632 27 Starting with the 2023 general enrollment period, coverage will begin Starting with the 2023 general enrollment period, coverage will begin the first day of the month after the month of the first day of the month after the month of
enrollment, per the Consolidated Appropriations Act, 2021 (P.L. 116-260; Division CC, §102). enrollment, per the Consolidated Appropriations Act, 2021 (P.L. 116-260; Division CC, §102).
~~27 T he~~ 28 The Part B general enrollment period is different from the Medicare Advantage and Part D annual enrollment period Part B general enrollment period is different from the Medicare Advantage and Part D annual enrollment period
which runs from October 15 to December 7which runs from October 15 to December 7 each year, with coverage effective the following January. each year, with coverage effective the following January.
~~28 2019~~29 Medicare Working-Aged Beneficiary Counts from CMS from CMS 100% Unloaded100% Unloaded Enrollment Database. Data provided Enrollment Database. Data provided
by by CMS, April 2022. 30 Social ~~CMS, May 2021.~~
~~29 Social~~ Security Act §1837(i) and 42 C.F.R. §407.20. SeeSecurity Act §1837(i) and 42 C.F.R. §407.20. See Medicare Publication “Medicare and Other Health Benefits: Medicare Publication “Medicare and Other Health Benefits:
Your GuideYour Guide to Who Pays First,” to Who Pays First,” at https://www.medicare.gov/https://www.medicare.gov/~~Pubs/pdf/02179-Medicare-Coordination-Benefits-~~
~~Payer.pdf, and CMS, “~~ sites/default/files/2021-10/02179-Medicare-and-other-health-benefits-your-guide-to-who-pays-first.pdf, and CMS, “Medicare Secondary Payer,” at https://www.cms.gov/Medicare/Coordination-of-Benefits-and-Medicare Secondary Payer,” at https://www.cms.gov/Medicare/Coordination-of-Benefits-and-
Recovery/Coordination-of-Benefits-and-Recovery-Overview/Medicare-Secondary-Payer/Medicare-Secondary-Recovery/Coordination-of-Benefits-and-Recovery-Overview/Medicare-Secondary-Payer/Medicare-Secondary-
Payer.html. Also see CRSPayer.html. Also see CRS Report RL33587, Report RL33587, Medicare Secondary Payer: Coordination of Benefits. .
~~30 T he~~ 31 The requirement that large employers’ coverage pays primary for Medicare-eligible requirement that large employers’ coverage pays primary for Medicare-eligible employees wasemployees was created by the created by the
~~T ax~~Tax Equity and Fiscal Equity and Fiscal Responsibility Act of 1982Responsibility Act of 1982 (P.L. 97-248) and amended by(P.L. 97-248) and amended by the Consolidated Omnibusthe Consolidated Omnibus Budget Budget
Reconciliation Act of 1985 (COBRA; P.L. 99-272). Reconciliation Act of 1985 (COBRA; P.L. 99-272).
3132 For Medicare-eligible For Medicare-eligible beneficiaries employed bybeneficiaries employed by organizations with fewer than 20 employees (or fewer than 100 organizations with fewer than 20 employees (or fewer than 100
employees for the disabled),employees for the disabled), ~~Medicare~~ Medicare generally pays primary and the employer group health plan generally pays generally pays primary and the employer group health plan generally pays
secondary. However, those who are covered under group health plans from employers of secondary. However, those who are covered under group health plans from employers of any size, based, based on their own on their own
or their spouse’s current employment, will not be subject to the enrollment limitations or late-enrollment penalties for or their spouse’s current employment, will not be subject to the enrollment limitations or late-enrollment penalties for
the period of time the period of time induring which they have group health plan coverage. See which they have group health plan coverage. See SSA,SSA, Program Operations Manual System
(POMS), HI 00805.751, “, HI 00805.751, “ SEP and Premium SurchargeSEP and Premium Surcharge Requirements for the AgedRequirements for the Aged Effective 8/86Effective 8/86 ~~,” at~~
~~https://secure.ssa.gov/apps10/poms.nsf/lnx/0600805751. Organizations with fewer than 20 employees are not,~~
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Such individuals may sign up for Medicare Part B (or Part A) Such individuals may sign up for Medicare Part B (or Part A)3233 anytime that they (or their spouse) anytime that they (or their spouse)
are are ~~stil~~ still working, and they are covered by a group health plan through the employer or union working, and they are covered by a group health plan through the employer or union
based on that work.based on that work.~~33 Additional y~~34 Additionally, those who qualify for Medicare based on age may sign up , those who qualify for Medicare based on age may sign up
during the eight-month period after retirement or the ending of group health plan coverage, during the eight-month period after retirement or the ending of group health plan coverage,
whichever happens first. (If an individual’s group health plan coverage, or the employment on . (If an individual’s group health plan coverage, or the employment on
which it is based, ends during the which it is based, ends during the initial enrollment period, that individual would not qualify for a , that individual would not qualify for a
SEP.)SEP.)3435 Disabled individuals whose group plan is involuntarily Disabled individuals whose group plan is involuntarily terminated have six months to terminated have six months to
enroll without penalty.enroll without penalty.35
36 For those enrolling during an employment-related SEP, coverage For those enrolling during an employment-related SEP, coverage ~~general y~~generally begins the first of the begins the first of the
month following the month of enrollment, and late-enrollment penalties would not apply.month following the month of enrollment, and late-enrollment penalties would not apply.3637 Those Those
who qualify for a SEP based on coverage through current employment must provide proof of that who qualify for a SEP based on coverage through current employment must provide proof of that
coverage and employment when applying.coverage and employment when applying.37
38 Certain international volunteers and individuals eligible Certain international volunteers and individuals eligible for “equitable relief” may also qualify for for “equitable relief” may also qualify for
a SEP and an exemption from the late-enrollment penalty. See a SEP and an exemption from the late-enrollment penalty. See “Late-Enrollment Premium
Penalty and Exemptions” below for additional detail on these circumstances. below for additional detail on these circumstances. ~~Additional y~~Additionally, ,
beginning in 2023, the Consolidated Appropriations Act, 2021 (P.L. 116-260; Division CC, beginning in 2023, the Consolidated Appropriations Act, 2021 (P.L. 116-260; Division CC,
Section 102) provides the Secretary of HHS the authority to establish special enrollment periods Section 102) provides the Secretary of HHS the authority to establish special enrollment periods
for beneficiaries who meet “exceptional conditions” that are to be defined by the Secretary. for beneficiaries who meet “exceptional conditions” that are to be defined by the Secretary.

~~however, required~~ https://secure.ssa.gov/apps10/poms.nsf/lnx/0600805751. Organizations with fewer than 20 employees are not, however, required to offer the same group health insurance to their Medicare-eligible employees that they offer to their to offer the same group health insurance to their Medicare-eligible employees that they offer to their
other employees. In such cases,other employees. In such cases, small employers may choose to instead offer coverage that wraps around the Medicare small employers may choose to instead offer coverage that wraps around the Medicare
benefit or not provide any coverage, and their Medicare-eligiblebenefit or not provide any coverage, and their Medicare-eligible employees may need to enroll in Medicareemployees may need to enroll in Medicare ~~Part s~~ Parts A and A and
B when first eligibleB when first eligible to avoid potential to avoid potential ~~late-enrollment penalties and/or~~ gaps in coverage. Individualsgaps in coverage. Individuals who are turning who are turning
65 and still working should65 and still working should check with their employers’ benefit administrator to learn how their employer health check with their employers’ benefit administrator to learn how their employer health
coverage workscoverage works with Medicare. with Medicare.
~~32 T hose~~33 Those who have a Health Savings who have a Health Savings Account (HSA)Account (HSA) with a highwith a high -deductible-deductible health plan through one’s own or one’s health plan through one’s own or one’s
spouse’sspouse’s current employment may need to stop contributing to the HSA at least six months prior to applying for Part A current employment may need to stop contributing to the HSA at least six months prior to applying for Part A
in order to avoid a tax penalty. See CRSin order to avoid a tax penalty. See CRS In FocusIn Focus IF11425, IF11425, Health Savings Accounts (HSAs) and Medicare. .
~~33 See Social~~ 34 See Social Security publication “How to Apply for Medicare Part B duringSecurity publication “How to Apply for Medicare Part B during Your SpecialYour Special Enrollment Period,” at Enrollment Period,” at
https://www.ssa.gov/pubs/EN-05-10012.pdf. https://www.ssa.gov/pubs/EN-05-10012.pdf.
~~34 See “Special Enrollment Period” section of Social Security web page. SSA, “ Retirement Planner: Applying for~~
~~Medicare Only~~ 35 See SSA, “Special Enrollment Period (SEP),” at https://www.ssa.gov/,” at https://www.ssa.gov/~~benefits/medicare/.~~
~~35 T he~~help/iClaim_medSEP.html. 36 The Balanced Budget Balanced Budget Act of 1997 (BBA; P.L. 105-33) added this exception to the penalty. This exception is for Act of 1997 (BBA; P.L. 105-33) added this exception to the penalty. This exception is for
disableddisabled persons (a) who, at the time they first become eligiblepersons (a) who, at the time they first become eligible for Part B, are enrolled in a group health plan for Part B, are enrolled in a group health plan
(regardless(regardless of size) by virtue of their current or former employment and (b) whose continuous enrollment under the of size) by virtue of their current or former employment and (b) whose continuous enrollment under the
plan is involuntarily terminated at a time when their enrollment in the plan is by virtue of their or their spouse’plan is involuntarily terminated at a time when their enrollment in the plan is by virtue of their or their spouse’ s former s former
(i.e., not current) employment. These individuals have a special six-month enrollment period beginning on the first day (i.e., not current) employment. These individuals have a special six-month enrollment period beginning on the first day
of the month in which the termination occurs. of the month in which the termination occurs.
36 37 For those who apply while For those who apply while still employed or duringstill employed or during the first month of the SEP, coverage may begin the month of the first month of the SEP, coverage may begin the month of
enrollment. See SSAenrollment. See SSA publication “Medicare” at https://www.ssa.gov/pubs/EN-05-10043.pdf. publication “Medicare” at https://www.ssa.gov/pubs/EN-05-10043.pdf.
~~37 T o~~38 To sign up for Part B while sign up for Part B while employed or duringemployed or during the 8 months after employment ends, one must complete an the 8 months after employment ends, one must complete an
“Application for Enrollment in Part B” (CMS-40B) and a “Request for Employment Information” (CMS-L564). Form “Application for Enrollment in Part B” (CMS-40B) and a “Request for Employment Information” (CMS-L564). Form
CMS-40BCMS-40B and instructions for submissionand instructions for submission may be accessedmay be accessed at https://www.cms.gov/Medicare/CMS-Forms/CMS-at https://www.cms.gov/Medicare/CMS-Forms/CMS-
Forms/CMS-Forms-Items/CMS017339, and form CMS-L564 and instructions for submissionForms/CMS-Forms-Items/CMS017339, and form CMS-L564 and instructions for submission may be found at may be found at
https://www.cms.gov/Medicare/CMS-Forms/CMS-Forms/https://www.cms.gov/Medicare/CMS-Forms/CMS-Forms/~~CM S~~CMS-Forms-Items/CMS009718.-Forms-Items/CMS009718. Under certain Under certain
circumstances where individualscircumstances where individuals are unableare unable to obtain evidence from the employer or health plan, alternative to obtain evidence from the employer or health plan, alternative
documentation may be accepted. For example, see documentation may be accepted. For example, see ~~January 28, 2021, question at SSA.gov, Social Security and~~
~~Coronavirus Disease (COVID-19), “ Can I enroll in Medicare?~~SSA.gov, “Medicare Benefits/Already Enrolled in Medicare” at https://www.ssa.gov/” at https://www.ssa.gov/~~coronavirus/.~~
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Late-Enrollment Premium Penalty and Exemptions
Beneficiaries who do not sign up for Part B when first eligible, or who drop it and then sign up Beneficiaries who do not sign up for Part B when first eligible, or who drop it and then sign up
again later, may have to pay a late-enrollment penalty for as long as they are enrolled in Part B.again later, may have to pay a late-enrollment penalty for as long as they are enrolled in Part B.3839
Monthly premiums for Part B may go up 10% for each full 12-month period that one could have Monthly premiums for Part B may go up 10% for each full 12-month period that one could have
had Part B but did not sign up for it. (See had Part B but did not sign up for it. (See “Calculation of Penalty.”)”) Some may be exempt from Some may be exempt from
paying a late-enrollment penalty if they meet certain conditions that paying a late-enrollment penalty if they meet certain conditions that ~~al ow~~allow them to sign up for them to sign up for
Part B during a SEP. (See Part B during a SEP. (See “Penalty Exemptions.”) In ) In ~~2020~~2021, about 1., about 1.43% of Part B enrollees (about % of Part B enrollees (about
~~776,200~~779,400) paid this penalty.) paid this penalty.3940 On average, their total premiums (standard premium plus penalty) On average, their total premiums (standard premium plus penalty)
were about 27% higher than what they would have been had they not been subject to the penalty.were about 27% higher than what they would have been had they not been subject to the penalty.
Those who receive premium assistance through a Medicare Savings Program do not pay the late- Those who receive premium assistance through a Medicare Savings Program do not pay the late-
enrollment penalty.enrollment penalty.~~40 Additional y,~~ 41 Additionally, for those disabled persons under the age of 65 subject to a for those disabled persons under the age of 65 subject to a
premium penalty, once the individual reaches the age of 65, he or she qualifies for a new premium penalty, once the individual reaches the age of 65, he or she qualifies for a new
enrollment period and no longer pays a penalty. enrollment period and no longer pays a penalty.
The penalty provision was included in the original Medicare legislation enacted in 1965 to help The penalty provision was included in the original Medicare legislation enacted in 1965 to help
prevent adverse selection by creating a strong incentive for prevent adverse selection by creating a strong incentive for ~~al eligible~~ all eligible beneficiaries to enroll in beneficiaries to enroll in
Part B.Part B.4142 Adverse selection occurs when only those persons who think they need the benefits Adverse selection occurs when only those persons who think they need the benefits
~~actual y~~actually enroll in the program. When this happens, per capita costs are driven up and premiums enroll in the program. When this happens, per capita costs are driven up and premiums
go up, causing more enrollees (presumably the healthier and less costly ones) to drop out of the go up, causing more enrollees (presumably the healthier and less costly ones) to drop out of the
program.program.4243 With most eligible persons over the age of 65 enrolled in Part B, the costs are spread With most eligible persons over the age of 65 enrolled in Part B, the costs are spread
over the majority of this population and per capita costs are less than would be the case if adverse over the majority of this population and per capita costs are less than would be the case if adverse
selection had occurred. selection had occurred.
As the Part B late-enrollment penalty is tied to Medicare eligibility As the Part B late-enrollment penalty is tied to Medicare eligibility and not to access to covered and not to access to covered
services, individuals who live in areas where Medicare benefits are services, individuals who live in areas where Medicare benefits are ~~general y~~generally not provided, such not provided, such
as outside of the United States or in prison, could as outside of the United States or in prison, could ~~stil~~ still be subject to the Part B late-enrollment be subject to the Part B late-enrollment
penalty if they do not sign up for (or if they drop) Part B when eligible.penalty if they do not sign up for (or if they drop) Part B when eligible.~~43 To il ustrate, if a retired~~

3844 To illustrate, if a retired 39 For more information, see Medicare.gov “Part B Late Enrollment Penalty,” at https://www.medicare.gov/your- For more information, see Medicare.gov “Part B Late Enrollment Penalty,” at https://www.medicare.gov/your-
medicare-costs/part-b-costs/part-b-late-enrollment-penalty. medicare-costs/part-b-costs/part-b-late-enrollment-penalty.
3940 Figures Figures provided by CMS,provided by CMS, ~~May 2021.~~
~~40 T he~~ April 2022. 41 The state pays the standard premium regardless state pays the standard premium regardless of the date the beneficiary first became eligibleof the date the beneficiary first became eligible for Medicare Part B. for Medicare Part B.
SeeSee SSA,SSA, Program Operations Manual System (POMS), Section HI 00815.001, “, Section HI 00815.001, “ State Buy-In Program General State Buy-In Program General
Description,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0600815001; and Ibid., Section HI 00815.039, “Effect of Description,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0600815001; and Ibid., Section HI 00815.039, “Effect of
Buy-In on the Individual,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0600815039. Buy-In on the Individual,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0600815039.
4142 Social Social Security Act §1839(b). Security Act §1839(b).
4243 Specifically, adverse selection occurs when beneficiaries, Specifically, adverse selection occurs when beneficiaries, who generally have more information than insurers about who generally have more information than insurers about
their own health status and expected health care needs, make insurance purchasingtheir own health status and expected health care needs, make insurance purchasing decisions baseddecisions based on their on their ~~expect ed~~
~~use~~ expected use of the insurance benefit. of the insurance benefit. ~~T heir~~Their decision to purchase insurance is based decision to purchase insurance is based on a comparison of the value of the on a comparison of the value of the
insurance coverage, given their expected use, and the cost of the insurance. Shouldinsurance coverage, given their expected use, and the cost of the insurance. Should only (or disproportionately) persons only (or disproportionately) persons
who are high health care users enroll in the program, per capita costs wouldwho are high health care users enroll in the program, per capita costs would increase, thereby making the health increase, thereby making the health
insurance purchase decision lessinsurance purchase decision less attractive for healthier, and presumably less costly, beneficiaries who thenattractive for healthier, and presumably less costly, beneficiaries who then , in turn, , in turn,
might drop out of the program. Subsequentmight drop out of the program. Subsequent iterations of this cycle woulditerations of this cycle would drive premium costs higher anddrive premium costs higher and higher for a higher for a
smaller and smaller subsetsmaller and smaller subset of ever sicker and costlier beneficiaries. of ever sicker and costlier beneficiaries.
4344 By comparison, to be eligible By comparison, to be eligible for the outpatient prescription drug benefit under Part D, a Medicare beneficiary must for the outpatient prescription drug benefit under Part D, a Medicare beneficiary must
residereside in a geographic area wherein a geographic area where a Part D plan is available. Individualsa Part D plan is available. Individuals ~~who~~ who are incarcerated or who live outside the are incarcerated or who live outside the
United States are therefore United States are therefore not eligible to enroll in (or continue enrollment in) Part D. Because the Part D penalty is to enroll in (or continue enrollment in) Part D. Because the Part D penalty is
basedbased on periods whenon periods when one is eligibleone is eligible but not enrolled, periods of incarceration or extended residence outside of the but not enrolled, periods of incarceration or extended residence outside of the
United States wouldUnited States would not be includednot be included in that calculation. For example, an individual livingin that calculation. For example, an individual living outside of the country during outside of the country during
his or her initial enrollment period wouldhis or her initial enrollment period would be be given a special enrollment period (SEP) upon returning to the United given a special enrollment period (SEP) upon returning to the United
States and wouldStates and would be ablebe able to sign up for Part D at that time without penalty. See SSA,to sign up for Part D at that time without penalty. See SSA, Program Operations Manual
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Medicare Part B: Enrollment and Premiums

Medicare-eligible Medicare-eligible ~~individual~~ individual stopped paying Part B premiums while livingstopped paying Part B premiums while living overseas for a three-overseas for a three-
year period and reenrolled when returning to the United States, he or she would not be entitled to year period and reenrolled when returning to the United States, he or she would not be entitled to
a SEP. This individual would instead need to enroll during the general enrollment period and a SEP. This individual would instead need to enroll during the general enrollment period and
could also be subject to late-enrollment penalties based on that three-year lapse in coverage. could also be subject to late-enrollment penalties based on that three-year lapse in coverage.
~~Additional y,~~ Additionally, Part B does not have a “creditable” coverage exemption similar to that under the Part B does not have a “creditable” coverage exemption similar to that under the
Part D outpatient prescription drug benefit.Part D outpatient prescription drug benefit.4445 Except for certain circumstances discussed below, Except for certain circumstances discussed below,
having equivalent coverage does not entitle one to a SEP should one decide to enroll in Part B having equivalent coverage does not entitle one to a SEP should one decide to enroll in Part B
later. For example, an individuallater. For example, an individual who has retiree coverage similar to Part B and therefore decides who has retiree coverage similar to Part B and therefore decides
not to enroll in Part B when first eligible could be subject to late-enrollment penalties if he or she not to enroll in Part B when first eligible could be subject to late-enrollment penalties if he or she
enrolls in Part B at a later time (for example, because the retiree coverage was discontinued). enrolls in Part B at a later time (for example, because the retiree coverage was discontinued).
Calculation of Penalty
The late-enrollment penalty is equal to a 10% premium surcharge for each full 12 months of The late-enrollment penalty is equal to a 10% premium surcharge for each full 12 months of
delay in enrollment and/or reenrollment during which the beneficiary was eligible for Medicare.delay in enrollment and/or reenrollment during which the beneficiary was eligible for Medicare.4546
The period of the delay is equal to (1) the number of months that elapse between the end of the The period of the delay is equal to (1) the number of months that elapse between the end of the
initialinitial enrollment period and the end of the enrollment period in which the individual enrollment period and the end of the enrollment period in which the individual ~~actual y~~
actually enrolls or (2) for a person who reenrolls, the months that elapse between the termination of enrolls or (2) for a person who reenrolls, the months that elapse between the termination of
coverage and the close of the enrollment period in which the individualcoverage and the close of the enrollment period in which the individual enrolls. enrolls.
~~General y~~Generally, individuals, individuals who do not enroll in Part B within a year of the end of their initial who do not enroll in Part B within a year of the end of their initial
enrollment period would be subject to the premium penalty. For example, if an individual’s initial enrollment period would be subject to the premium penalty. For example, if an individual’s initial
enrollment period ended in September enrollment period ended in September ~~2018~~2019 and the individual and the individual subsequently enrolled during the subsequently enrolled during the
~~2019~~2020 general general ~~enrol ment~~enrollment period (January 1 through March 31), the delay would be less than 12 period (January 1 through March 31), the delay would be less than 12
months and the individualmonths and the individual would not be subject to a penalty. However, if that individualwould not be subject to a penalty. However, if that individual delayed delayed
enrolling until the enrolling until the ~~2021~~2022 general enrollment period, the premium penalty would be 20% of that general enrollment period, the premium penalty would be 20% of that
year’s standard premium. (Although the elapsed time covers a total of 30 months of delayed year’s standard premium. (Although the elapsed time covers a total of 30 months of delayed
enrollment, the episode includes only two full 12-month periods.) An individual who waits 10 enrollment, the episode includes only two full 12-month periods.) An individual who waits 10
years to enroll in Part B could pay twice the standard premium amount. years to enroll in Part B could pay twice the standard premium amount.
The late-enrollment surcharge is calculated as a percentage of the monthly standard premium The late-enrollment surcharge is calculated as a percentage of the monthly standard premium
amount (e.g., $amount (e.g., $~~148.50 in 2021),46~~170.10 in 2022),47 and that amount is added to the beneficiary’s premium each and that amount is added to the beneficiary’s premium each
~~month. The hold-harmless provision does not provide protection from increases in the penalty~~
~~amounts.47~~

~~System~~ System (POMS), Section HI 03001.001, “, Section HI 03001.001, “ Description of the Medicare Part D Prescription Drug Program,” atDescription of the Medicare Part D Prescription Drug Program,” at
https://secure.ssa.gov/poms.nsf/lnx/0603001001, and CMS Publication, “https://secure.ssa.gov/poms.nsf/lnx/0603001001, and CMS Publication, “ Understanding MedicareUnderstanding Medicare ~~Part C & D~~
Advantage and Medicare Drug Plan Enrollment Periods,” at https://www.medicare.gov/Pubs/pdf/11219-Understanding-Medicare-Part-C-D.pdf. Enrollment Periods,” at https://www.medicare.gov/Pubs/pdf/11219-Understanding-Medicare-Part-C-D.pdf.
44 45 Under Part D, individuals Under Part D, individuals who have maintained drugwho have maintained drug coverage equivalent to Medicare’s standard prescription drug coverage equivalent to Medicare’s standard prescription drug
coverage prior coverage prior ~~t o~~to enrolling in Part D are not subject to a late-enrollment penalty. Examples of “ enrolling in Part D are not subject to a late-enrollment penalty. Examples of “ creditable” Part D drug creditable” Part D drug
coverage includecoverage include ~~drug~~ drug coverage from a former employer or union, coverage from a former employer or union, ~~T RICARE~~TRICARE, the Department of , the Department of ~~Veteran s~~Veterans Affairs Affairs
(VA), the Federal Employees Health Benefits Program (FEHBP), or the Indian Health Service.(VA), the Federal Employees Health Benefits Program (FEHBP), or the Indian Health Service. As an illustration, if an As an illustration, if an
individualindividual ~~did~~ did not sign up for Part D when first becomingnot sign up for Part D when first becoming ~~eligible because~~ eligible because he or she already had equivalent coverage he or she already had equivalent coverage
through a former employer, the individual couldthrough a former employer, the individual could ~~sign~~ sign up for Part D at any time up for Part D at any time ~~wit hout~~without penalty during the time he or penalty during the time he or
she maintained creditable coverage. Shouldshe maintained creditable coverage. Should that coverage end, the individualthat coverage end, the individual ~~would~~ would be entitled to a special enrollment be entitled to a special enrollment
period and could enroll in Part D without penaltyperiod and could enroll in Part D without penalty . Beneficiaries who have a break in creditable. Beneficiaries who have a break in creditable prescription drug prescription drug
coverage usuallycoverage usually have 63 consecutive days to enroll in Part D duringhave 63 consecutive days to enroll in Part D during a SEP. a SEP.
4546 Social Social Security Act §1839(b). Security Act §1839(b).
4647 SSA, SSA, Program Operations Manual System (POMS), Section HI 01001.010, “Premium Increase for Late Enrollment,” , Section HI 01001.010, “Premium Increase for Late Enrollment,”
at https://secure.ssa.gov/poms.nsf/lnx/0601001010. at https://secure.ssa.gov/poms.nsf/lnx/0601001010.
~~47 Although those who are held harmless pay reduced premiums, any late-enrollment penalties are calculated as a~~
~~percentage of the premium for that year (e.g., in 2021, a percentage of $148.50).~~
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link to page link to page 2123 Medicare Part B: Enrollment and Premiums

month. The hold-harmless provision does not provide protection from increases in the penalty amounts.48 Using the example above in which an individualUsing the example above in which an individual is subject to a 20% premium penalty, the total is subject to a 20% premium penalty, the total
monthly premium in monthly premium in ~~2021~~2022 would be calculated as follows (see text box): would be calculated as follows (see text box):
Calculation of Late-Enrollment Penalty

Premium Penalty = Standard Premium = Standard Premium × Applicable Percentage × Applicable Percentage

Penalty-Adjusted Premium = Monthly Premium= Monthly Premium + Premium+ Premium Penalty Penalty

Example of a 20% penalty ~~in 2021~~ in 2022:

Premium Premium Penalty = $Penalty = $~~148.50~~170.10 × 20% = $ × 20% = $~~29.70~~34.02
Penalty-Adjusted Premium Penalty-Adjusted Premium ~~= $148.50 + $29.70 = $178.20~~ = $170.10 + $34.02 = $204.10*

*Premium amounts are rounded to the nearest 10 cents. *Premium amounts are rounded to the nearest 10 cents.
For those subject to the high-income premium (see For those subject to the high-income premium (see “Income-Related Premiums”)”), the late-, the late-
enrollment surcharge applies only to the standard monthly premium amount and not to the higher-enrollment surcharge applies only to the standard monthly premium amount and not to the higher-
income adjustment portion of their premiums. Using the example of a 20% penalty for a income adjustment portion of their premiums. Using the example of a 20% penalty for a
beneficiary with an income of between $beneficiary with an income of between $8891,000 and $,000 and $~~111~~114,000, the applicable income-related ,000, the applicable income-related
adjustment of $adjustment of $~~59.40~~68.00 would be added on to the penalty-adjusted premium of $ would be added on to the penalty-adjusted premium of $~~178.20 ($148.50 +~~
~~$29.70 penalty), for a total monthly premium of $237.60.48~~
204.10 ($170.10 + $34.02 penalty), for a total monthly premium (rounded to the nearest 10 cents) of $272.10.49 There is no upper limit on the amount of the surcharge that may apply, and the penalty continues There is no upper limit on the amount of the surcharge that may apply, and the penalty continues
to apply for the entire time the individualto apply for the entire time the individual is enrolled in Part B. Each year, the surcharge is is enrolled in Part B. Each year, the surcharge is
calculated using the standard premium amount for that particular year. Therefore, if premiums calculated using the standard premium amount for that particular year. Therefore, if premiums
increase in a given year, the dollar value of the surcharge increase in a given year, the dollar value of the surcharge ~~wil~~ will increase as increase as ~~wel~~ well. .
Penalty Exemptions
Under certain conditions, select beneficiaries may be exempt from the late-enrollment penalty. Under certain conditions, select beneficiaries may be exempt from the late-enrollment penalty.
Beneficiaries who are exempt include working individuals (and their spouses) with group Beneficiaries who are exempt include working individuals (and their spouses) with group
coverage, some international volunteers, and those who based their nonenrollment decision on coverage, some international volunteers, and those who based their nonenrollment decision on
incorrect information provided by a federal representative. Individuals who are permitted to delay incorrect information provided by a federal representative. Individuals who are permitted to delay
enrollment have their own SEPs. enrollment have their own SEPs.
Current Workers
As described above (see “Special Enrollment Periods”), some individuals (or their spouse) who As described above (see “Special Enrollment Periods”), some individuals (or their spouse) who
are are ~~stil~~ still working and receiving employer-provided health insurance through that employment may working and receiving employer-provided health insurance through that employment may
~~qualify for a SEP and not be subject to late-enrollment penalties. Those who fail to enroll during~~
~~this special enrollment period are considered to have delayed enrollment and thus could be~~
~~subject to the penalty.49 For example, even though an individual may have continued health~~

~~48 T hose~~ 48 Although those who are held harmless pay reduced premiums, any late-enrollment penalties are calculated as a percentage of the premium for that year (e.g., in 2022, a percentage of $170.10). 49 Those who pay the high-income premiums are not protected by the hold-harmless provision. For additional who pay the high-income premiums are not protected by the hold-harmless provision. For additional
information, see SSA,information, see SSA, ~~Program s~~ Programs Operation Manual, Section HI 01101.031, “How IRMAA is, Section HI 01101.031, “How IRMAA is ~~Calculated~~ Calculated and How and How
IRMAA Affects the IRMAA Affects the ~~T otal~~Total Medicare Premium,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0601101031. Medicare Premium,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0601101031.
~~49 T hose who are covered under group health plans from employers of any size, based on their own or their spouse’s~~
~~current employment, will not be subject to the enrollment limitations or late-enrollment penalties for the period of time~~
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10

~~Medicare Part B: Enrollment and Premiums~~

Congressional Research Service 10 Medicare Part B: Enrollment and Premiums qualify for a SEP and not be subject to late-enrollment penalties. Those who fail to enroll during this special enrollment period are considered to have delayed enrollment and thus could be subject to the penalty.50 For example, even though an individual may have continued health coverage through the former employer after retirement or have COBRA coverage,coverage through the former employer after retirement or have COBRA coverage,5051 he or she he or she
must sign up for Part B within eight months of retiring to avoid paying a Part B penalty if he or must sign up for Part B within eight months of retiring to avoid paying a Part B penalty if he or
she she ~~eventual y~~eventually enrolls. Individuals who return to work and receive health care coverage through enrolls. Individuals who return to work and receive health care coverage through
that employment may be able to drop Part B coverage, qualify for a new special enrollment that employment may be able to drop Part B coverage, qualify for a new special enrollment
period upon leaving that employment, and reenroll in Part B without penalty as long as period upon leaving that employment, and reenroll in Part B without penalty as long as
enrollment is completed within the specified time frame. enrollment is completed within the specified time frame.
International Volunteers
Some international volunteers may also be exempt from the Part B late-enrollment penalty. The Some international volunteers may also be exempt from the Part B late-enrollment penalty. The
Deficit Reduction Act of 2005 (P.L. 109-171) permits certain individuals to delay enrollment in Deficit Reduction Act of 2005 (P.L. 109-171) permits certain individuals to delay enrollment in
Part B without a late-enrollment penalty if they volunteered outside of the United States for at Part B without a late-enrollment penalty if they volunteered outside of the United States for at
least 12 months through a program sponsored by a tax-exempt organization defined under Section least 12 months through a program sponsored by a tax-exempt organization defined under Section
501(c)(3) of the Internal Revenue Code.501(c)(3) of the Internal Revenue Code.5152 These individuals must demonstrate that they had These individuals must demonstrate that they had
health insurance coverage while serving in the international program.health insurance coverage while serving in the international program.5253 Individuals permitted to Individuals permitted to
delay enrollment have a six-month SEP, which begins on the first day of the first month they no delay enrollment have a six-month SEP, which begins on the first day of the first month they no
longer qualify under this provision. longer qualify under this provision.
Equitable Relief
Under certain circumstances, a SEP may be created and/or late-enrollment penalties may be Under certain circumstances, a SEP may be created and/or late-enrollment penalties may be
waived if a Medicare beneficiary can establish that an error, misrepresentation, or inaction of a waived if a Medicare beneficiary can establish that an error, misrepresentation, or inaction of a
federal worker or an agent of the federal government (such as an employee of the Social Security federal worker or an agent of the federal government (such as an employee of the Social Security
Administration, CMS, or a Medicare administrative contractor) resulted in late Part B Administration, CMS, or a Medicare administrative contractor) resulted in late Part B
enrollment.enrollment.5354 To qualify for an exception under these conditions, the beneficiary must provide To qualify for an exception under these conditions, the beneficiary must provide
documentary evidence of the error, which “can be in the form of statements from employees, documentary evidence of the error, which “can be in the form of statements from employees,
agents, or persons in authority that the agents, or persons in authority that the ~~al eged~~alleged misinformation, misadvice, misrepresentation, misinformation, misadvice, misrepresentation,
inaction, or erroneous action inaction, or erroneous action ~~actual y~~actually occurred.” occurred.”5455
Time-limited equitable relief also may be granted for certain categories of individuals. For Time-limited equitable relief also may be granted for certain categories of individuals. For
example, CMS may provide a special enrollment period to those affected by a weather-related example, CMS may provide a special enrollment period to those affected by a weather-related
emergency or a major disaster.emergency or a major disaster.5556 As described below, during the Coronavirus Disease 2019 As described below, during the Coronavirus Disease 2019
~~(COVID-19) public health emergency, certain individuals who were not able to enroll in Part B in~~
~~a timely manner were al owed additional time to enroll under equitable relief (through June 17,~~
~~2020). Additional y, CMS determined that it did not provide adequate information regarding Part~~

50 Those who are covered under group health plans from employers of any size, based on their own or their spouse’s current employment, will not be subject to the enrollment limitations or late-enrollment penalties for the period of time in which they have group health plan coverage. Seein which they have group health plan coverage. See SSA,SSA, Program Operations Manual System (POMS), HI 00805.751, , HI 00805.751,
“SEP and Premium Surcharge“SEP and Premium Surcharge Requirements for the AgedRequirements for the Aged Effective 8/86,” at https://secure.ssa.gov/apps10/poms.nsfEffective 8/86,” at https://secure.ssa.gov/apps10/poms.nsf
/lnx/0600805751. /lnx/0600805751.
5051 For a description of COBRA, For a description of COBRA, ~~see CRS~~ see CRS Report R40142, Report R40142, Health Insurance Continuation Coverage Under COBRA. .
5152 Social Social Security Act §1837(k) and 42 C.F.R.Security Act §1837(k) and 42 C.F.R. §407.21. §407.21.
5253 See See SSA,SSA, Program Operations Manual System (POMS), Section HI 00805.355, “Evidentiary Requirements for the , Section HI 00805.355, “Evidentiary Requirements for the
SEP or Premium-SurchargeSEP or Premium-Surcharge Rollback for International Volunteers,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/Rollback for International Volunteers,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/
0600805355. 0600805355.
53 54 Social Social Security Act §1837(h) and 42 C.F.R.Security Act §1837(h) and 42 C.F.R. §407.32. §407.32.
5455 For additional information, see SSA, For additional information, see SSA, Program Operations Manual System (POMS), Section HI 00805.170, , Section HI 00805.170,
“Conditions for Providing Equitable Relief,” at https://secure.ssa.gov/poms.nsf/lnx/0600805170, and Ibid, Section HI “Conditions for Providing Equitable Relief,” at https://secure.ssa.gov/poms.nsf/lnx/0600805170, and Ibid, Section HI
00805.175, “Evidence of Government Error or Delay00805.175, “Evidence of Government Error or Delay ,” at https://secure.ssa.gov/poms.nsf/lnx/0600805175. ,” at https://secure.ssa.gov/poms.nsf/lnx/0600805175.
5556 See See SSA,SSA, Program Operations Manual System (POMS), Section HI 00805.324, “Equitable Relief for Enrollment , Section HI 00805.324, “Equitable Relief for Enrollment
~~Request Affected by Major Disasters,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0600805324.~~
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Medicare Part B: Enrollment and Premiums

(COVID-19) public health emergency, certain individuals who were not able to enroll in Part B in a timely manner were allowed additional time to enroll under equitable relief (through June 17, 2020). Additionally, CMS determined that it did not provide adequate information regarding Part B enrollment to certain individuals with exchange coverage who enrolled in Medicare Part A and B enrollment to certain individuals with exchange coverage who enrolled in Medicare Part A and
~~al owed~~allowed equitable relief to these individuals equitable relief to these individuals (through June 2020). (through June 2020).
Limited ~~Time Medicare Enrollment Equitable Relief During the COVID-19~~
~~Pandemic-Related National Emergency~~
~~Beneficiaries who were not able to enroll in Part B in a timely manner as a result~~-Time Equitable Relief for Beneficiaries Unable to Contact SSA by Phone [Effective through December 2022] Beneficiaries who have not been able to enroll in Medicare in a timely manner during their initial or special enrollment periods or the 2022 general enrollment period as a result of systemic technical issues with SSA’s national 800 number and field office general inquiry phone lines are allowed limited-time equitable relief.57 Specifically, those who are or have been unable to enroll in Medicare B due to SSA’s telephone issues after January 1, 2022, will be granted additional time to enroll through December 30, 2022. Limited-Time Medicare Enrollment Equitable Relief During the COVID-19 Pandemic-Related National Emergency [Expired June 2020] Beneficiaries who were not able to enroll in Part B in a timely manner because of local Social of local Social
Security field office closures during the COVID-19 public health emergency were granted certain Security field office closures during the COVID-19 public health emergency were granted certain
enrollment flexibilitiesenrollment flexibilities under equitable relief.under equitable relief.~~56 Specifical y~~58 Specifically, CMS granted equitable relief in the , CMS granted equitable relief in the
form of additional time to enroll during one’s initialform of additional time to enroll during one’s initial enrollment period, during the annual general enrollment period, during the annual general
enrollment period, or during a special enrollment period (SEP), such as the enrollment period, or during a special enrollment period (SEP), such as the 8eight-month period when -month period when
a beneficiary’s employer coverage based on current employment ends. Beneficiaries were eligible a beneficiary’s employer coverage based on current employment ends. Beneficiaries were eligible
for this equitable relief only if they had an initialfor this equitable relief only if they had an initial enrollment period, general enrollment period, or enrollment period, general enrollment period, or
SEP during the period from March 17, 2020 through June 17, 2020, and the beneficiary did not SEP during the period from March 17, 2020 through June 17, 2020, and the beneficiary did not
apply for Part B during that enrollment period. Eligibleapply for Part B during that enrollment period. Eligible beneficiaries who wanted to use this beneficiaries who wanted to use this
equitable relief to enroll in Part B needed to file their enrollment request by June 17, 2020. equitable relief to enroll in Part B needed to file their enrollment request by June 17, 2020.
Coverage was effective the month that would have been applicable had the application been filed Coverage was effective the month that would have been applicable had the application been filed
at the time of the individual’s original (but missed) initial, general, or special enrollment period. at the time of the individual’s original (but missed) initial, general, or special enrollment period.
Limited -Time Equitable ~~Relief~~ Relief for Individuals with Medicare Part A and
Exchange Coverage
~~CMS general y~~[Expired June 2020] CMS generally encourages those who have coverage through an individual exchange (also known encourages those who have coverage through an individual exchange (also known
as marketplace) plan, and subsequently become eligible for Medicare, to drop the exchange as marketplace) plan, and subsequently become eligible for Medicare, to drop the exchange
coverage and enroll in Medicare during their initialcoverage and enroll in Medicare during their initial enrollment period. After an individualenrollment period. After an individual has has
become eligiblebecome eligible for Medicare Part A, any tax credits and cost-sharing reductions that that for Medicare Part A, any tax credits and cost-sharing reductions that that
individualindividual receives through an exchange plan ends.receives through an exchange plan ends.5759 CMS recognized that “these individuals did Request Affected by Major Disasters,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0600805324. 57 SSA, Emergency Message: EM-22020 REV, “Limited Availability of Equitable Relief - Medicare Enrollment/Disenrollment for Beneficiaries Unable to Contact SSA’s National 800 Network Number (N8NN) or Field Office (FO) General Inquiry (GI) Lines,” effective April 7, 2022, at https://secure.ssa.gov/apps10/reference.nsf/links/04012022122513PM. 58 See CMS, “Enrollment Issues for COVID-19 Pandemic-Related National Emergency, Questions and Answers for Medicare Beneficiaries,” at https://www.cms.gov/files/document/enrollment-issues-covid-ab-faqs.pdf. 59 CMS indicates that in this instance, the individual should contact the marketplace at least 15 days before the date one wants the coverage to end. Congressional Research Service 12 Medicare Part B: Enrollment and Premiums ~~CMS recognized that “these individuals did~~
not receive the information necessary at the time of their Medicare [initialnot receive the information necessary at the time of their Medicare [initial enrollment period], enrollment period],
Part B SEP for the working aged or disabled, or initialPart B SEP for the working aged or disabled, or initial enrollment in the Exchange to make an enrollment in the Exchange to make an
informed decision regarding their Part B enrollment.”informed decision regarding their Part B enrollment.”5860 This may have resulted in these This may have resulted in these
individualsindividuals not enrolling in Part B, or enrolling in Part B late and being subject to a late not enrolling in Part B, or enrolling in Part B late and being subject to a late
enrollment penalty. enrollment penalty.
CMS thus offered time-limited equitable relief through June 30, 2020, for certain individuals CMS thus offered time-limited equitable relief through June 30, 2020, for certain individuals
enrolled in both premium-free Medicare Part A and in a plan provided through the health enrolled in both premium-free Medicare Part A and in a plan provided through the health
insurance exchanges.insurance exchanges.~~59 Specifical y~~61 Specifically, those who had been enrolled in an exchange plan and in , those who had been enrolled in an exchange plan and in
premium-free Medicare Part A, and had a Part A entitlement date that began on or after July 1, premium-free Medicare Part A, and had a Part A entitlement date that began on or after July 1,
2013 (or a Part B SEP that ended on or after October 1, 2013) could enroll in Part B without 2013 (or a Part B SEP that ended on or after October 1, 2013) could enroll in Part B without

~~56 See CMS, “Enrollment Issues for COVID-19 Pandemic-Related National Emergency, Questions and Answers for~~
~~Medicare Beneficiaries,” at https://www.cms.gov/files/document/enrollment-issues-covid-ab-faqs.pdf.~~
~~57 CMS indicates that in this instance, the individual should contact the marketplace at least 15 days before the date one~~
~~wants the coverage to end.~~
~~58 CMS Factsheet, “Assistance for Individuals with Medicare Part A and Exchange Coverage Infor mation~~penalty through June 30, 2020. Additionally, the Part B late enrollment penalties of those who had both Part A and exchange coverage and signed up for Part B outside of their initial enrollment period could have been reduced or eliminated. Proposed Special Enrollment Periods for “Exceptional Conditions” Section 120 of the Consolidated Appropriations Act, 2021 (P.L. 116-260), provided the Secretary with the authority to create special enrollment periods for individuals meeting certain exceptional conditions, as defined by the Secretary, beginning January 1, 2023. In the proposed implementing regulation issued on April 22, 2022,62 CMS indicated that it plans to establish five SEPs under this new authority. Four of the proposed SEPs address specific exceptional conditions, and a fifth would permit CMS or SSA to grant SEPs on a case-by-case basis due to unanticipated conditions. Specifically, CMS is proposing special enrollment periods for the following circumstances:  Individuals who missed an opportunity to enroll because they were impacted by a disaster or other emergency as declared by a federal, state, or local government entity;  Individuals who did not enroll timely because their employer or health plan provided incorrect information regarding Medicare enrollment;  Formerly incarcerated individuals following their release from correctional facilities;63  Individuals whose Medicaid eligibility has been terminated; and 60 CMS Factsheet, “Assistance for Individuals with Medicare Part A and Exchange Coverage Information for SHIPs for SHIPs
and Exchange Assisters,” October 2019, https://www.cms.gov/Medicare/Eligibility-and-Enrollment/Medicare-and-the-and Exchange Assisters,” October 2019, https://www.cms.gov/Medicare/Eligibility-and-Enrollment/Medicare-and-the-
Marketplace/Downloads/SHIP-Navigator-Fact-SheetMarketplace/Downloads/SHIP-Navigator-Fact-Sheet -2019.pdf-2019.pdf.
~~59 Individuals who paid a premium for Medicare Part A were not eligible for this equitable relief, as they are required~~ , and SSA, Program Operations Manual System, HI 00805.721, “Equitable Relief for Certain Individuals Dually Enrolled in Both Medicare and a Marketplace Plan,” at https://secure.ssa.gov/poms.nsf/lnx/0600805721 . 61 Individuals who paid a premium for Medicare Part A were not eligible for this equitable relief, as they are required to to
enroll in Part B in order to enroll in Part A. enroll in Part B in order to enroll in Part A. ~~T hose~~Those enrolled in a Marketplace Small Business enrolled in a Marketplace Small Business Health Options Program Health Options Program
(SHOP) plan were(SHOP) plan were also not eligiblealso not eligible for this equitablefor this equitable relief, as suchrelief, as such plans are considered employer sponsored plans and, plans are considered employer sponsored plans and,
as describedas described earlier, these individualsearlier, these individuals already qualifyalready qualify for a special enrollment period once that coverage ends. 62 See CMS Fact Sheet, “Implementing Certain Provisions of the Consolidated Appropriations Act, 2021 and other Revisions to Medicare Enrollment and Eligibility Rules (CMS-4199-P),” April 22, 2022 at https://www.cms.gov/newsroom/fact-sheets/implementing-certain-provisions-consolidated-appropriations-act-2021-and-other-revisions-medicare-1. The proposed regulation was posted in the Federal Register on April 27, 2022 at 87 Federal Register 25090, https://www.govinfo.gov/content/pkg/FR-2022-04-27/pdf/2022-08903.pdf. 63 As noted earlier, Medicare generally does not cover the health care services of incarcerated individuals; however, incarcerated individuals do not lose their Medicare eligibility and can therefore be subject to late-enrollment penalties if they do not enroll in and pay premiums for Part B when first eligible. ~~for a special enrollment period once that coverage ends.~~
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~~penalty through June 30, 2020. Additional y, the Part B late enrollment penalties of those who had~~
~~both Part A and exchange coverage and signed up for Part B outside of their initial enrollment~~
~~period could have been reduced or eliminated~~  Other exceptional conditions, determined on a case-by-case basis, under which circumstances beyond an individual’s control prevented that individual from enrolling in Medicare. Individuals who miss an initial enrollment period, general enrollment period, or another SEP (such as the eight-month employment-related SEP) due to one of the above exceptional conditions would be eligible to enroll in Medicare premium-Part A and/or Part B using the new SEPs. Individuals enrolling during one of these SEPs would not be subject to late-enrollment penalties. Comments on the proposed regulation are due June 27, 2022. .
Collection of the Part B Premium
Part B premiums may be paid in a variety of ways.Part B premiums may be paid in a variety of ways.6064 If an enrollee is receiving Social Security or If an enrollee is receiving Social Security or
Railroad Retirement benefits,Railroad Retirement benefits,6165 the Part B premiums must, by law, be deducted from these the Part B premiums must, by law, be deducted from these
benefits. benefits. ~~Additional y,~~ Additionally, Part B premiums are deducted from the benefits of those receiving a Part B premiums are deducted from the benefits of those receiving a
Federal CivilFederal Civil Service Retirement annuity.Service Retirement annuity.6266 The purpose of collecting premiums by deducting The purpose of collecting premiums by deducting
them from benefits is to keep premium collection costs at minimum. This withholding does not them from benefits is to keep premium collection costs at minimum. This withholding does not
apply to those beneficiaries receiving state public assistance through a Medicare Savings Program apply to those beneficiaries receiving state public assistance through a Medicare Savings Program
because their premiums are paid by their state Medicaid program. (See because their premiums are paid by their state Medicaid program. (See “Premium Assistance for
Low-Income Beneficiaries.”)”)
Part B enrollees who do not receive monthly Social Security, Railroad Retirement, or Civil Part B enrollees who do not receive monthly Social Security, Railroad Retirement, or Civil
Service Retirement benefits, or assistance through a Medicare Savings Program, pay premiums Service Retirement benefits, or assistance through a Medicare Savings Program, pay premiums
directly to CMS.directly to CMS.6367
Deduction of Part B Premiums from Social Security Checks
By law, a Social Security beneficiary who is enrolled in Medicare Part B must have the Part B By law, a Social Security beneficiary who is enrolled in Medicare Part B must have the Part B
premium premium ~~automatical y~~automatically deducted from his or her Social Security benefits. deducted from his or her Social Security benefits.6468 Automatic deduction Automatic deduction
from the Social Security benefit check also applies to Medicare Advantage participants who are from the Social Security benefit check also applies to Medicare Advantage participants who are
enrolled in private health care plans in lieu of traditional Medicare.enrolled in private health care plans in lieu of traditional Medicare.6569 In instances in which a In instances in which a
beneficiary’s monthly Social Security benefit is not sufficient to cover the entire Part B premium beneficiary’s monthly Social Security benefit is not sufficient to cover the entire Part B premium
amount, Medicare may amount, Medicare may ~~bil~~ bill the beneficiary for the balance.the beneficiary for the balance.~~66 In 2020~~70 In 2021, about 68% of Medicare Part 64 SSA, ~~, about 68% of Medicare Part~~
~~B enrollees (41.7 mil ion) had their Part B premiums deducted from their Social Security benefit~~
~~checks.67~~
~~Social Security beneficiaries who do not pay Medicare Part B premiums include those who are~~
~~under the age of 65 and do not yet qualify for Medicare (e.g., began receiving Social Security~~

~~60 SSA,~~ Program Operations Manual System (POMS), Section HI 01001.020, “, Section HI 01001.020, “ Collection of Premiums,” at Collection of Premiums,” at
https://secure.ssa.gov/poms.nsf/lnx/0601001020. https://secure.ssa.gov/poms.nsf/lnx/0601001020.
6165 Social Social Security Act §1840(a)(1) and §1840(b)(1). See CRSSecurity Act §1840(a)(1) and §1840(b)(1). See CRS Report R42035, Report R42035, Social Security Primer, and CRS, and CRS Report Report
RS22350, RS22350, Railroad ~~Retirem ent Board: Retirem ent~~Retirement Board: Retirement, Survivor, Disability, ~~Unem ploym ent~~Unemployment, and Sickness Benefits. .
~~62 See CRS~~ 66 See CRS Report 98-810, Report 98-810, Federal Employees’ Retirement System: Benefits and Financing . .
6367 42 C.F.R. §408.60. 42 C.F.R. §408.60.
6468 Social Social Security Act §1840(a)(1). Security Act §1840(a)(1).
6569 Beneficiaries who receive their Parts A and B benefits through Medicare Advantage (MA, Part C), must still pay the Beneficiaries who receive their Parts A and B benefits through Medicare Advantage (MA, Part C), must still pay the
monthly Part B premium, but may pay different amounts. For example, some MA plans may offer an additional benefit monthly Part B premium, but may pay different amounts. For example, some MA plans may offer an additional benefit
by reducingby reducing ~~t he~~ the amount one pays for the Part B premium. Alternatively, some MA plans may be more expensive than amount one pays for the Part B premium. Alternatively, some MA plans may be more expensive than
traditional Medicare, for example becausetraditional Medicare, for example because they provide benefits beyond what is provided under traditional Medicare, they provide benefits beyond what is provided under traditional Medicare,
and may charge a premium in addition to and may charge a premium in addition to ~~t he~~the Part B premium. Part B premium. ~~T he~~The Social Security Social Security Administration has in place a Administration has in place a
“safety net” to prevent the deduction of more than $300 of Part C and Part D plan premiums from a single“safety net” to prevent the deduction of more than $300 of Part C and Part D plan premiums from a single Social Social
Security check. For amounts over $300, the enrollee may be billedSecurity check. For amounts over $300, the enrollee may be billed directly. directly.
6670 SSA, SSA, Program Operations Manual System (POMS), Section HI 01001.041, “Collection from Beneficiaries When the , Section HI 01001.041, “Collection from Beneficiaries When the
Amount of the Benefit Payment Amount of the Benefit Payment isIs Less than the Amount of the Premium Less than the Amount of the Premium ,” at https://secure.ssa.gov/apps10/poms.nsf/,” at https://secure.ssa.gov/apps10/poms.nsf/
lnx/0601001041lnx/0601001041.
~~67 Figures provided by CMS, May 2021~~. .
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B enrollees (43.2 million) had their Part B premiums deducted from their Social Security benefit checks.71 Social Security beneficiaries who do not pay Medicare Part B premiums include those who are under the age of 65 and do not yet qualify for Medicare (e.g., began receiving Social Security benefits at the age of 62); receive low-income assistance from Medicaid to pay the Part B benefits at the age of 62); receive low-income assistance from Medicaid to pay the Part B
premium; have started to receive Social Security disability insurance (SSDI) but are not eligible premium; have started to receive Social Security disability insurance (SSDI) but are not eligible
for Medicare Part B because they have not received SSDI for 24 months; or chose not to enroll in for Medicare Part B because they have not received SSDI for 24 months; or chose not to enroll in
Medicare Part B. Medicare Part B.
The amount of an individual’s Social Security benefits cannot go down from one year to the next The amount of an individual’s Social Security benefits cannot go down from one year to the next
as a result of the annual Part B premium increase, except in the case of higher-income individuals as a result of the annual Part B premium increase, except in the case of higher-income individuals
subject to income-related premiums. (See subject to income-related premiums. (See “Protection of Social Security Benefits from Increases
in Medicare Part B Premiums.”)”) For those beneficiaries “held harmless,” the dollar amount of For those beneficiaries “held harmless,” the dollar amount of
their Part B premium increases would be held below or equal to the amount of the increase in their Part B premium increases would be held below or equal to the amount of the increase in
their monthly Social Security benefits. their monthly Social Security benefits.
Part B Enrollees Who Do Not Receive Social Security Benefits
A A ~~smal~~ small percentage of Medicare Part B enrollees do not receive Social Security benefits. For percentage of Medicare Part B enrollees do not receive Social Security benefits. For
example, some individuals aged 65 and older may have deferred signing up for Social Security example, some individuals aged 65 and older may have deferred signing up for Social Security
for various reasons, for instance if they have not yet reached their full Social Security retirement for various reasons, for instance if they have not yet reached their full Social Security retirement
~~age68~~age72 or are or are ~~stil~~ still working. working. ~~Additional y,~~ Additionally, certain persons who spent their careers in employment certain persons who spent their careers in employment
that was not covered by Social Security—including certain federal, state, or local government that was not covered by Social Security—including certain federal, state, or local government
workers and certain other categories of workers—do not receive Social Security benefits but may workers and certain other categories of workers—do not receive Social Security benefits but may
~~stil~~ still qualify for Medicare. For those who receive benefit payments from the qualify for Medicare. For those who receive benefit payments from the ~~RRB69~~RRB73 or the Civil or the Civil
Service Retirement System (CSRS),Service Retirement System (CSRS),7074 Part B premiums are deducted from the enrollees’ monthly Part B premiums are deducted from the enrollees’ monthly
benefit payments. While RRB retirement benefit amounts are protected by the hold-harmless benefit payments. While RRB retirement benefit amounts are protected by the hold-harmless
provision, CSRS benefits are not held harmless from annual increases in the Part B premium. provision, CSRS benefits are not held harmless from annual increases in the Part B premium.
For those who do not receive these types of benefit payments, Medicare For those who do not receive these types of benefit payments, Medicare ~~wil general y bil~~
will generally bill directly for their premiums every three months.directly for their premiums every three months.7175 The enrollee who is being The enrollee who is being ~~bil ed~~ billed does not does not
necessarily have to pay his or her own premiums; premiums may be paid by the enrollee, a necessarily have to pay his or her own premiums; premiums may be paid by the enrollee, a
relative, friend, organization, or anyone else.relative, friend, organization, or anyone else.7276 In cases where an organization wants to be In cases where an organization wants to be ~~bil ed~~billed
for the Part B premiums of a number of Medicare beneficiaries, it may enter into a formal group-for the Part B premiums of a number of Medicare beneficiaries, it may enter into a formal group-
~~bil ing arrangement with CMS.73 Those approved as group bil ers include such entities as city and~~
~~county governments, state teacher retirement systems, and certain religious orders.~~

~~68 See CRS~~ 71 Figures provided by CMS, April 2022. 72 See CRS Report R44670, Report R44670, The Social Security Retirement Age. .
6973 Social Social Security Act §1840(b)(1). Security Act §1840(b)(1).
7074 Generally, employees of the federal government hired before 1984 are covered by the Civil Service Retirement Generally, employees of the federal government hired before 1984 are covered by the Civil Service Retirement
System (CSRS)System (CSRS) and are not covered by Socialand are not covered by Social Security. Most federal workers first hired into federal service on or after Security. Most federal workers first hired into federal service on or after
January 1984 participate in the Federal Employees’ Retirement System (FERS), whichJanuary 1984 participate in the Federal Employees’ Retirement System (FERS), which ~~includes Social~~ includes Social Security Security
coverage. However, the coverage. However, the ~~T ax~~Tax Equity and Fiscal Responsibility Act (P.L. 97-248) enabled federal workers to be eligible Equity and Fiscal Responsibility Act (P.L. 97-248) enabled federal workers to be eligible
for Medicare basedfor Medicare based on their federal employmenton their federal employment . See CRS. See CRS Report R42741, Report R42741, Laws Affecting the Federal ~~Em ployees~~Employees
Health Benefits (FEHB) Program . .
71 75 Payment may be made by check, money order, or credit card; alternatively, one may schedule a payment to be Payment may be made by check, money order, or credit card; alternatively, one may schedule a payment to be
automatically deducted from one’s bank account. Premium billingautomatically deducted from one’s bank account. Premium billing form and information may be found at form and information may be found at
https://www.medicare.gov/forms-help-resources/mail-you-get-abouthttps://www.medicare.gov/forms-help-resources/mail-you-get-about -medicare/medicare-premium-bill-cms-500. -medicare/medicare-premium-bill-cms-500.
7276 SSA, SSA, Program Operations Manual System (POMS), Section HI 01001.225, “When Premium Notices May Be Sent to , Section HI 01001.225, “When Premium Notices May Be Sent to
an Individualan Individual Other Other ~~T han~~Than an Enrollee,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0601001225. an Enrollee,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0601001225.
~~73 SSA, Program Operations Manual System (POMS), Section HI 01001.230, “Group Collection-General,” at~~
~~https://secure.ssa.gov/poms.nsf/lnx/0601001230.~~
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billing arrangement with CMS.77 Those approved as group billers include such entities as city and county governments, state teacher retirement systems, and certain religious orders. Nonpayment of premiums results in termination of enrollment in the Part B program, although a Nonpayment of premiums results in termination of enrollment in the Part B program, although a
grace period (through the last day of the third month following the month of the due date) is grace period (through the last day of the third month following the month of the due date) is
~~al owed~~allowed for beneficiaries who are for beneficiaries who are ~~bil ed~~billed and pay directly. and pay directly.7478
Determining the Part B Premium
Each year, the CMS actuaries estimate total per capita Part B costs for beneficiaries aged 65 and Each year, the CMS actuaries estimate total per capita Part B costs for beneficiaries aged 65 and
older older ~~over~~ for the following year and set the Part B premium to cover 25% of expected Part B for the following year and set the Part B premium to cover 25% of expected Part B
expenditures.expenditures.7579 However, because prospective estimates may differ from the actual spending for However, because prospective estimates may differ from the actual spending for
the year, contingency margin adjustments are made to ensure sufficient income to accommodate the year, contingency margin adjustments are made to ensure sufficient income to accommodate
potential variation in actual expenditures during the year. (See potential variation in actual expenditures during the year. (See “Contingency Margin.”)”) The Part The Part
B premium is a single national amount that does not vary with a beneficiary’s age, health status, B premium is a single national amount that does not vary with a beneficiary’s age, health status,
or place of residence. Premiums may be adjusted upward for late enrollment (see or place of residence. Premiums may be adjusted upward for late enrollment (see “Late-
Enrollment Premium Penalty and Exemptions”)) and for beneficiaries with high incomes (see and for beneficiaries with high incomes (see
“Income-Related Premiums”)), or they may be adjusted downward for those protected by the hold-, or they may be adjusted downward for those protected by the hold-
harmless provision (see harmless provision (see “Protection of Social Security Benefits from Increases in Medicare Part B
~~Premiums”~~)Premiums”). .
Monthly Part B premiums are based on the estimated amount that would be needed to finance Monthly Part B premiums are based on the estimated amount that would be needed to finance
Part B expenditures on an incurred basis during the year. In estimating needed income and to Part B expenditures on an incurred basis during the year. In estimating needed income and to
account for potential variation, CMS takes into consideration the difference in prior years of account for potential variation, CMS takes into consideration the difference in prior years of
estimated and actual program costs, the likelihood and potential impact of potential legislation estimated and actual program costs, the likelihood and potential impact of potential legislation
affecting Part B in the coming year, and the expected relationship between incurred and cash affecting Part B in the coming year, and the expected relationship between incurred and cash
expenditures (e.g., payments for some services provided during a particular year may not be paid expenditures (e.g., payments for some services provided during a particular year may not be paid
until the following year). Once the premium has been set for a year, it until the following year). Once the premium has been set for a year, it ~~wil not be~~is typically not changed during changed during
that year.that year.80
While both aged and disabled Medicare beneficiaries may enroll in Part B, the statute provides While both aged and disabled Medicare beneficiaries may enroll in Part B, the statute provides
that Part B premiums are to be based only on the expected program costs—that is, the monthly that Part B premiums are to be based only on the expected program costs—that is, the monthly
actuarial rate—for the aged (those 65 years of age and older).actuarial rate—for the aged (those 65 years of age and older).7681 The actuarial rate for the aged is The actuarial rate for the aged is
defined as one-half of the expected average monthly per capita program costs for the aged plus defined as one-half of the expected average monthly per capita program costs for the aged plus
any contingency margin adjustments. Standard Part B premiums are one-half of that actuarial any contingency margin adjustments. Standard Part B premiums are one-half of that actuarial
rate. (rate. (See See Appendix A for a history of the premium methodology.) Part B costs not covered by for a history of the premium methodology.) Part B costs not covered by
~~premiums are paid for through transfers from the General Fund of the Treasury. The monthly~~
~~actuarial rates for both aged and disabled enrollees are used to determine the needed amount of~~
~~matching general revenue funding.77~~
~~Starting in 2016, a $3.00 per month surcharge has been added onto the standard premium (higher~~
~~amounts for high-income individuals). To mitigate the expected large premium increases for those~~

~~74 T his~~ 77 SSA, Program Operations Manual System (POMS), Section HI 01001.230, “Group Collection-General,” at https://secure.ssa.gov/poms.nsf/lnx/0601001230. 78 This grace period may be extended for up to an additional three months if the enrollee can establish that nonpayment grace period may be extended for up to an additional three months if the enrollee can establish that nonpayment
waswas ~~due~~ due to circumstances beyond his or her control, such as beingto circumstances beyond his or her control, such as being physically or mentally incapable of making premium physically or mentally incapable of making premium
payments or due to an administrative error. payments or due to an administrative error. ~~T here~~There is no financial hardship exemption, although those with sufficiently is no financial hardship exemption, although those with sufficiently
lowlow income may qualify for premium assistance from a state Medicaidincome may qualify for premium assistance from a state Medicaid program.program.
75 79 Part B premium announcements are generally made Part B premium announcements are generally made in the fall prior to the effective year. 80 Due to pricing reductions in and CMS coverage decisions for the new Alzheimer’s drug Aduhelm made subsequent to the date of the 2022 premium determination, a mid-year change to the 2022 premium is being considered. See HHS, January 10, 2022, Press Announcement, “HHS Secretary Xavier Becerra Instructs CMS to Reassess Recommendation for 2022 Medicare Part B Premium” at https://www.hhs.gov/about/news/2022/01/10/hhs-secretary-xavier-becerra-instructs-cms-reassess-recommendation-2022-medicare-part-b-premium.html. As of the date of this report, CMS has not issued any information regarding a potential adjustment to the 2022 Part B premium. (For additional detail, see “Contingency Margin.”) 81 Social Security Act §1839(a). Congressional Research Service 16 link to page 51 link to page 51 link to page 24 link to page 42 Medicare Part B: Enrollment and Premiums premiums are paid for through transfers from the General Fund of the Treasury. The monthly actuarial rates for both aged and disabled enrollees are used to determine the needed amount of matching general revenue funding.82 Starting in 2016, a $3.00 per month surcharge has been added onto the standard premium (higher amounts for high-income individuals). To mitigate the expected large premium increases for those not held harmless in 2016, the Bipartisan Budget Act of 2015 (BBA ~~in the fall prior to the effective year.~~
~~76 Social Security Act §1839(a).~~
~~77 T he actuarial rate for the disabled is defined as one-half of the expected average monthly cost per disabled enrollee.~~
~~Average per capita costs for the disabled are generally higher than those for the aged; therefore, were these average~~
~~costs included in the premium determination, all Part B enrollees could pay higher premiums. As general revenue~~
~~funding is determined using both the average costs of the aged and the disabled, this funding is sufficient to compensate~~
~~for the reduction in premium revenues due to not including the costs of the disabled in determining the premium~~
~~amount.~~
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~~not held harmless in 2016, the Bipartisan Budget Act of 2015 (BBA~~ 15; P.L. 114-74) required that 15; P.L. 114-74) required that
2016 Medicare Part B premiums be set as if the hold-harmless rule were not in effect—in other 2016 Medicare Part B premiums be set as if the hold-harmless rule were not in effect—in other
words, to calculate premiums as if words, to calculate premiums as if al all enrollees were paying the same annual inflation-adjusted enrollees were paying the same annual inflation-adjusted
standard premium. (For additional information on the changes made by BBAstandard premium. (For additional information on the changes made by BBA 15, se15, see Appendix
D.~~) Additional y,~~ ) Additionally, as described below, the Continuing Appropriations Act, 2021as described below, the Continuing Appropriations Act, 2021, and Other and Other
Extensions Act (P.L. 116-159) extended the imposition of this surcharge. Extensions Act (P.L. 116-159) extended the imposition of this surcharge.
To compensate for the lost premium revenue (below the required 25%) and to ensure that the SMI To compensate for the lost premium revenue (below the required 25%) and to ensure that the SMI
Trust Fund had adequate income to cover payments for Part B benefits in 2016, BBATrust Fund had adequate income to cover payments for Part B benefits in 2016, BBA ~~15 al owed~~
15 allowed for additional transfers from the General Fund of the Treasury to the SMI Trust Fund. To offset for additional transfers from the General Fund of the Treasury to the SMI Trust Fund. To offset
the approximately $9 the approximately $9 ~~bil ion~~ billion in increased federal spending in 2016 resulting from the reduction in in increased federal spending in 2016 resulting from the reduction in
standard premiums for those not held harmless, a $3.00 surcharge was added to the monthly standard premiums for those not held harmless, a $3.00 surcharge was added to the monthly
premium in 2016, and premium in 2016, and ~~wil continue~~is to be applied in subsequent years until the additional federal to be applied in subsequent years until the additional federal
costs are fully offset.costs are fully offset.7883 For those who pay high-income premiums, this surcharge increases on a For those who pay high-income premiums, this surcharge increases on a
sliding scale up to $sliding scale up to $~~9.60~~10.20. (See . (See “Income Categories and Premium Adjustments.”.”) It was estimated ) It was estimated
that the surcharge would be applied to premiums through 2021.that the surcharge would be applied to premiums through 2021.79
84 Similarly, the Continuing Appropriations Act, 2021 and Other Extensions Act limited the growth Similarly, the Continuing Appropriations Act, 2021 and Other Extensions Act limited the growth
in the Part B premium for 2021 (seein the Part B premium for 2021 (see ~~“Premium Calculation for 2021”~~ Appendix A for details on the for details on the 2021 premium premium
calculation methodology). To ensure that the SMI trust fund calculation methodology). To ensure that the SMI trust fund iswas adequately financed in 2021, adequately financed in 2021,
additional general revenue transfers additional general revenue transfers ~~are being~~were made to replace the lost premium income. made to replace the lost premium income.~~80 The~~
To offset the approximately $8.8 billion in increased federal costs, the $3.00 surcharge, and applicable high-income surcharges, $3.00 surcharge, and applicable high-income surcharges, ~~wil~~ will continue to be applied until those continue to be applied until those
amounts are repaid.amounts are repaid.85 It is estimated that this surcharge It is estimated that this surcharge ~~wil~~ will be applied to premiums through December 2025.86 82 The actuarial rate for the disabled is defined as one-half of the expected average monthly cost per disabled enrollee. Average per capita costs for the disabled are generally higher than those for the aged; therefore, were these average costs included in the premium determination, all Part B enrollees could pay higher premiums. As general revenue funding is determined using both the average costs of the aged and the disabled, this funding is sufficient to compensate for the reduction in premium revenues due to not including the costs of the disabled in determining the premium amount. 83 The $9 billion consists of about $7.4 billion in increased federal spending due to the reduced standard premiums and about $1.6 billion in lost revenues due to the reduction in high-income adjustments. The $3.00 standard premium surcharge “pays for” the increased general revenue transfers in 2016, while the additional high-income surcharge adjustments are used to offset the reduction in the income-related adjustment amounts. CMS, “Medicare Program: Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, 2016,” 80 Federal Register 70811, November 16, 2015. 84 2020 Medicare Trustees Report, p. 84. 85 CMS estimated that the increase in the balance due in 2021 would be about $8.8 billion, consisting~~be applied to premiums through~~
~~FY2026.81~~
~~Premium Calculation for 2021~~
~~To determine the 2021 monthly Part B premium amount,82 CMS first estimated the monthly~~
~~actuarial rate for enrollees aged 65 and older using actual per-enrollee costs by type of service~~
~~from program data through 2020 and projected these costs for subsequent years. CMS estimated~~
~~that the monthly amount needed to cover one-half of the total benefit and administration costs for~~
~~the aged in 2021 would be $307.52. Because of expected variations between projected and actual~~
~~costs, a contingency adjustment of $8.17 was added to this amount. (See “Contingency Margin,”~~

~~78 T he $9 billion consists of about $7.4 billion in increased federal spending due to the reduced standard premiums and~~
~~about $1.6 billion in lost revenues due to the reduction in high -income adjustments. T he $3.00 standard premium~~
~~surcharge “pays for” the increased general revenue transfers in 2016, while the additional high -income surcharge~~
~~adjustments are used to offset the reduction in the income-related adjustment amounts. CMS, “ Medicare Program:~~
~~Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, 2016,” 80~~
Federal Register 70811, November 16, 2015.
~~79 2020 Medicare T rustees Report, p. 84. In the final year of the repayment adjustments, the surcharge may be set at~~
~~less than $3.00 to avoid overpayment.~~
~~80 CMS estimates that the increase in the balance due in 2021 will be about $8.8 billion, which consists~~ of $946 million of $946 million
in forgone income-related premium income plus the additional transfer amount of about $7.9 billion. CMS,in forgone income-related premium income plus the additional transfer amount of about $7.9 billion. CMS, “ “Medicare Medicare
Program: Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual DeductibleProgram: Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, Beginning January 1,
2021,” 85 2021,” 85 Federal Register 71904, November 12, 2020. 71904, November 12, 2020.
~~81 CBO, “ Estimate for H.R. 8337, the Continuing Appropriations Act, 2021 and Other E xtensions Act, as Passed by the~~
~~House of Representatives on September 22, 2020 ,” September 23, 2020, T able 2, at https://www.cbo.gov/publication~~
~~/56629.~~
~~82 CMS, “Medicare Program: Medicare Part B Monthly Act uarial Rates, Premium Rate, and Annual Deductible~~
~~Beginning January 1, 2021,” 85 Federal Register 71904, November 12, 2020.~~
~~Congressional Research Service~~

16

~~Medicare Part B: Enrollment and Premiums~~

~~below.) After a reduction of $1.39 to account for expected interest on trust fund assets, the~~
~~preliminary monthly actuarial rate for the aged for 2021 was determined to be $314.30.~~
~~However, due to adjustments mandated by the Continuing Appropriations Act, 2021 and Other~~
~~Extensions Act (P.L. 116-159), the monthly actuarial rate for 2021 was reduced to $291.00.83 The~~
~~Part B standard premium would normal y~~86 2021 Medicare Trustees Report, p. 90. In the final year of the repayment adjustments, the surcharge may be set at less than $3.00 to avoid overpayment. Congressional Research Service 17 link to page 22 Medicare Part B: Enrollment and Premiums Premium Calculation for 2022 To determine the 2022 monthly Part B premium amount,87 CMS first estimated the monthly actuarial rate for enrollees aged 65 and older using actual per-enrollee costs by type of service from program data through 2020 and projected these costs for subsequent years. CMS estimated that the monthly amount needed to cover one-half of the total benefit and administration costs for the aged in 2022 would be $317.68. Because of expected variations between projected and actual costs, a contingency adjustment of $18.67 was added to this amount. (See “Contingency Margin,” below.) After a reduction of $2.15 to account for expected interest on trust fund assets, the monthly actuarial rate for the aged for 2022 was determined to be $334.20. The Part B standard premium would normally be calculated as one-half of the actuarial rate (i.e., half be calculated as one-half of the actuarial rate (i.e., half
~~of $291.00, or $145.50~~of $334.20, or $167.10 per month); per month);8488 however, the however, the ~~BBA 15/P.L. 116-159~~Continuing Appropriations Act, 2021 and Other Extensions Act (P.L. 116-159) repayment surcharge of repayment surcharge of
$3.00 was then added onto that amount for a total $3.00 was then added onto that amount for a total 2022 monthly premium of $monthly premium of $~~148.50~~170.10. .
Contingency Margin
The contingency margin is the amount set aside to cover an appropriate degree of potential The contingency margin is the amount set aside to cover an appropriate degree of potential
variation between actual and projected costs in a given year. For example, in some years, variation between actual and projected costs in a given year. For example, in some years,
~~legislation~~ legislation that resulted in increased Medicare Part B expenditures for the year was enacted after that resulted in increased Medicare Part B expenditures for the year was enacted after
the premium for the year had been set. The Medicare actuaries consider a contingency reserve the premium for the year had been set. The Medicare actuaries consider a contingency reserve
ratio—net assets at the end of a year in the Part B account of the SMI Trust Fund compared to the ratio—net assets at the end of a year in the Part B account of the SMI Trust Fund compared to the
following year’s expected expenditures—in the amount of 15% to 20% to be adequate, and following year’s expected expenditures—in the amount of 15% to 20% to be adequate, and
~~normal y~~normally aim for a 17% ratio when determining Part B financing for the upcoming year. The aim for a 17% ratio when determining Part B financing for the upcoming year. The
contingency margin for contingency margin for ~~2021~~2022 reflects financing rates set above the normal target due to the reflects financing rates set above the normal target due to the
higher-than-usual uncertainty in spending estimates. higher-than-usual uncertainty in spending estimates.
The contingency margin in The contingency margin in ~~2021 is~~2022 was affected by a number of factors. For example, the contingency affected by a number of factors. For example, the contingency
margin was adjusted upward to account for the uncertainty and potential impact of the COVID-19 margin was adjusted upward to account for the uncertainty and potential impact of the COVID-19
~~pandemic.85 Additional y,~~ pandemic and for the potential coverage and costs of the new Alzheimer’s drug Aduhelm.89 Additionally, starting in 2011, manufacturers and importers of brand-name drugs starting in 2011, manufacturers and importers of brand-name drugs
began paying a fee that is began paying a fee that is ~~al ocated~~allocated to the SMI Trust Fund. The contingency margin was thus to the SMI Trust Fund. The contingency margin was thus
reduced to account for this additional revenue. Further, certain payment incentives to encourage reduced to account for this additional revenue. Further, certain payment incentives to encourage
the development and use of health information technology (HIT) by Medicare physicians are the development and use of health information technology (HIT) by Medicare physicians are
excluded from premium determinations. (HIT bonuses or penalties are directly offset through excluded from premium determinations. (HIT bonuses or penalties are directly offset through
~~transfers of general funds from the Treasury.) The 2021 contingency margin adjustment of $8.17~~
~~reflects the expected net effects of al of the above factors.~~
~~Income-Related Premiums~~
~~For the first 41 years of the Medicare program, al Part B enrollees paid the same Part B~~
~~premium, regardless of their income. However, the Medicare Modernization Act of 2003 (MMA;~~

~~83 Section 2401 of the Continuing Appropriations Act, 2021 and Other Extensions Act ( P.L. 116-159) specifies that the~~
~~2021 monthly actuarial rate for enrollees aged 65 and older be determined as the sum of the 2020 monthly actuarial rate~~
~~for enrollees aged 65 and older and one-fourth of the difference between the 2020 monthly actuarial rate and the~~
~~preliminary 2021 monthly actuarial rate (as determined by the Secretary of HHS) for such enrollees. T he monthly~~
~~actuarial rate for 2021 was thus calculated as follows: $283.20 (the actual actuarial rate for 202 0) + (0.25 x ($314.30~~
~~(the unadjusted monthly actuarial rate for 2021) - $283.20)) = $291.00 (rounded to the nearest dime).~~
~~84 Rounded to the nearest dime.~~
~~85 Although about $43 billion was paid out of the Part B account of the SMI trust fund in 2020 as part of the~~
~~Accelerated and Advanced Payment (AAP) programs, and full repayments are not expected until 2021, the Continuing~~
~~Appropriations Act, 2021 and Other Extensions Act required that a transfer be made from the T reasury to the SMI trust~~
~~fund to restore t he AAP payments paid out and specifies that any future AAP provider repayments be transferred to the~~
~~T reasury. Because the CMS 2021 Part B financing projections assume that roughly $43 billion would be transferred~~
~~from the T reasury to Part B before the end of CY2020, the AAP payments did not affect the 2021 Part B premium~~
~~contingency margin. For additional information on the AAP program, see CRS Report R46698,~~ ~~Medicare Accelerated~~
~~and Advance Paym ents and COVID-19: Frequently Asked Questions~~.
~~Congressional Research Service~~

17

~~link to page 29 link to page 29~~ ~~Medicare Part B: Enrollment and Premiums~~

~~P.L. 108-173)86 required that, beginning in 2007, high-income enrollees pay higher premiums.87~~
~~About 7% of Medicare Part B enrollees are expected to pay these higher premiums in 2021.88~~
~~Adjustments, known as income-related monthly adjustment amounts (IRMAA), are made to the~~
87 CMS, “Medicare Program: Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, 2022,” 86 Federal Register 64205, November 17, 2021. 88 Rounded to the nearest dime. 89 At the time the 2022 premiums were set, the annual per person cost for a course of treatment of Adulelm was estimated to be $56,000. Since that time, the manufacturer of Aduhelm, Biogen, announced the price would be reduced to $28,200 per year. Given this pricing change, the Secretary of HHS requested on January 10, 2022, that CMS reassess the amount of the 2022 Medicare Part B premiums. Subsequently, on April 7, 2022, CMS finalized its Medicare coverage policy for Aduhelm that limits its coverage to individuals enrolled in qualifying clinical trials. As of the date of this report, CMS has not released information on a potential adjustment to the 2022 Part B premium. See HHS, “HHS Secretary Xavier Becerra Instructs CMS to Reassess Recommendation for 2022 Medicare Part B Premium” press announcement, January 10, 2022, at https://www.hhs.gov/about/news/2022/01/10/hhs-secretary-xavier-becerra-instructs-cms-reassess-recommendation-2022-medicare-part-b-premium.html; and CMS, “CMS Finalizes Medicare Coverage Policy for Monoclonal Antibodies Directed Against Amyloid for the Treatment of Alzheimer’s Disease,” press release, April 7, 2022, at https://www.cms.gov/newsroom/press-releases/cms-finalizes-medicare-coverage-policy-monoclonal-antibodies-directed-against-amyloid-treatment. Congressional Research Service 18 link to page 30 link to page 30 Medicare Part B: Enrollment and Premiums transfers of general funds from the Treasury.) The 2022 contingency margin adjustment of $18.67 reflects the expected net effects of all of the above factors. Income-Related Premiums For the first 41 years of the Medicare program, all Part B enrollees paid the same Part B premium, regardless of their income. However, the Medicare Modernization Act of 2003 (MMA; P.L. 108-173)90 required that, beginning in 2007, high-income enrollees pay higher premiums.91 About 7% of Medicare Part B enrollees are expected to pay these higher premiums in 2022.92 Adjustments, known as income-related monthly adjustment amounts (IRMAA), are made to the standard Part B premiums for high-income beneficiaries, with the share of expenditures paid by standard Part B premiums for high-income beneficiaries, with the share of expenditures paid by
beneficiaries increasing with income. This share ranges from 35% to 85% of the value of Part B beneficiaries increasing with income. This share ranges from 35% to 85% of the value of Part B
coverage. In coverage. In ~~2021~~2022, individuals whose incomes exceed $, individuals whose incomes exceed $8891,000 and couples whose combined ,000 and couples whose combined
income exceeds $income exceeds $~~176~~182,000 are subject to higher premium amounts.,000 are subject to higher premium amounts.8993 The hold-harmless provision The hold-harmless provision
that prevents a beneficiary’s Social Security benefits from decreasing from one year to the next as that prevents a beneficiary’s Social Security benefits from decreasing from one year to the next as
a result of the Part B premium increase does not apply to those subject to an income-related a result of the Part B premium increase does not apply to those subject to an income-related
increase in their Part B premiums. (See increase in their Part B premiums. (See “Protection of Social Security Benefits from Increases in
Medicare Part B Premiums.”) .”)
Determination of Income
To determine those subject to the high-income premium, Social Security uses the most recent To determine those subject to the high-income premium, Social Security uses the most recent
federal tax return provided by the Internal Revenue Service. In general, the taxable year used in federal tax return provided by the Internal Revenue Service. In general, the taxable year used in
determining the premium is the second calendar year preceding the applicable year. For example, determining the premium is the second calendar year preceding the applicable year. For example,
the the ~~2020~~2021 tax return ( tax return (~~2019~~2020 income) was used to determine who would pay the income) was used to determine who would pay the ~~2021~~2022 high-income high-income
premiums.premiums.9094
The income definition on which the high-income premiums are based is modified adjusted gross The income definition on which the high-income premiums are based is modified adjusted gross
income (MAGI),income (MAGI),9195 which is different from gross income. which is different from gross income. ~~Specifical y~~Specifically, gross income is all income 90 The~~, gross income is al income~~
~~from al sources, minus certain statutory exclusions (e.g., nontaxable Social Security benefits). 92~~
~~From gross income, adjusted gross income (AGI)93 is calculated to reflect a number of~~
~~deductions, including trade and business deductions and losses from sale of property. MAGI is~~
~~defined as AGI plus certain foreign-earned income and tax-exempt interest.94~~

~~86 T he~~ Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; P.L. 108-173) would have Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; P.L. 108-173) would have
phased in the increase over five years; however, the Deficit Reduction Act of 2005 (DRA; P.L. 109-171) shortened the phased in the increase over five years; however, the Deficit Reduction Act of 2005 (DRA; P.L. 109-171) shortened the
phase-in period to three years. phase-in period to three years.
8791 At the time of enactment of the MMA, CBO estimated that 1.2 million persons (3% of beneficiaries) would At the time of enactment of the MMA, CBO estimated that 1.2 million persons (3% of beneficiaries) would pay pay
higher premiums in 2007 and that 2.8 million persons (6% of beneficiaries) wouldhigher premiums in 2007 and that 2.8 million persons (6% of beneficiaries) would pay higher premiums in 2013. CBO pay higher premiums in 2013. CBO
further estimated that the MMA provision would reducefurther estimated that the MMA provision would reduce federal outlays by $13.federal outlays by $13. 3 billion over the 2007-2013 period. 3 billion over the 2007-2013 period.
CBOCBO estimated that the DRA provision accelerating the phase-in wouldestimated that the DRA provision accelerating the phase-in would increase premium collections by $1.6 billion increase premium collections by $1.6 billion
over the 2007-2010 period. over the 2007-2010 period. ~~T he~~The MMA estimate and the DRA estimate were made by CBO MMA estimate and the DRA estimate were made by CBO at the time of at the time of ~~enactmen t~~enactment of of
each law.each law. Both estimates were basedBoth estimates were based on the CBO budgeton the CBO budget baseline in effect at the time. As is the case for all CBO baseline in effect at the time. As is the case for all CBO
estimates, the earlier estimates are incorporated into subsequent CBOestimates, the earlier estimates are incorporated into subsequent CBO baselines. baselines. ~~T herefore~~Therefore, the two savings estimates , the two savings estimates
cannot be addedcannot be added together. together.
8892 CMS, CMS, Fact Sheet, “Fact Sheet, “~~2021~~2022 Medicare Parts A & B Medicare Parts A & B Premiums and Deductibles,”Premiums and Deductibles,” November November ~~6, 2020.~~
8912, 2021. 93 For additional information, see SSA, For additional information, see SSA, Program Operations Manual System (POMS), Section HI 01101.000, , Section HI 01101.000,
“Medicare Income-Related Monthly Adjustment Amount“Medicare Income-Related Monthly Adjustment Amount ,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0601101000. ,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0601101000.
9094 If the 2020 tax return was not available, SSA used 2019 tax return data. If an enrollee amended his or her tax return and doing so changed the income used If an enrollee amended his or her tax return and doing so changed the income used to determine the highto determine the high -income -income
adjustments, adjustments, ~~t he~~the updated information may be provided to the Social Security Administration so that the administration updated information may be provided to the Social Security Administration so that the administration
may correct or remove the income-related monthly adjustment amounts. may correct or remove the income-related monthly adjustment amounts.
9195 Defined at Social Defined at Social Security Act §1839(i)(4). See also SSA,Security Act §1839(i)(4). See also SSA, Program Operations Manual System (POMS), Section HI , Section HI
01101.010, “Modified Adjusted01101.010, “Modified Adjusted ~~Gross~~ Gross Income (MAGI),” at https://secure.ssa.gov/poms.nsf/lnx/0601101010. Income (MAGI),” at https://secure.ssa.gov/poms.nsf/lnx/0601101010.
~~92 Internal Revenue Code §61.~~
~~93 Internal Revenue Code §62.~~
~~94 T he definition of MAGI for the income-related monthly adjustment amount (IRMAA) in Medicare is different from~~
~~the MAGI definition in certain ACA Medicaid provisions. See CRS Report R43861,~~ ~~The Use of Modified Adjusted~~
~~Gross Incom e (MAGI) in Federal Health Program s~~.
~~Congressional Research Service~~

18

~~Medicare Part B: Enrollment and Premiums~~

Congressional Research Service 19 Medicare Part B: Enrollment and Premiums from all sources, minus certain statutory exclusions (e.g., nontaxable Social Security benefits).96 From gross income, adjusted gross income (AGI)97 is calculated to reflect a number of deductions, including trade and business deductions and losses from sale of property. MAGI is defined as AGI plus certain foreign-earned income and tax-exempt interest.98 If a person had a one-time increase in taxable income in a particular year (such as from the sale of If a person had a one-time increase in taxable income in a particular year (such as from the sale of
income-producing property), that increase would be considered in determining the individual’s income-producing property), that increase would be considered in determining the individual’s
total income for that year and thus his or her liabilitytotal income for that year and thus his or her liability for the income-related premium two years for the income-related premium two years
ahead. It would not be considered in the calculations for future years. ahead. It would not be considered in the calculations for future years.
In the case of certain major life-changing events that result in a significant reduction in MAGI, an In the case of certain major life-changing events that result in a significant reduction in MAGI, an
individualindividual may request to have the determination made for a more recent year than the second may request to have the determination made for a more recent year than the second
preceding year.preceding year.9599 Major life-changing events include (1) death of a spouse; (2) marriage; (3) Major life-changing events include (1) death of a spouse; (2) marriage; (3)
divorce or annulment; (4) partial or full work stoppage for the individual or spouse; (5) loss by divorce or annulment; (4) partial or full work stoppage for the individual or spouse; (5) loss by
~~individual~~ individual or spouse of income from income-producing property when the loss is not at the or spouse of income from income-producing property when the loss is not at the
individual’s direction (such as in the case of a natural disaster); and (6) reduction or loss for individual’s direction (such as in the case of a natural disaster); and (6) reduction or loss for
individualindividual or spouse of pension income due to termination or reorganization of the plan or or spouse of pension income due to termination or reorganization of the plan or
scheduled cessation of the pension.scheduled cessation of the pension.96100 Certain types of events, such as those that affect expenses Certain types of events, such as those that affect expenses
but not income or those that result in the loss of dividend income because of the ordinary risk of but not income or those that result in the loss of dividend income because of the ordinary risk of
investment, are not considered major life-changing events.investment, are not considered major life-changing events.97101
If Medicare enrollees disagree with decisions regarding their IRMAAs, they may file an appeal If Medicare enrollees disagree with decisions regarding their IRMAAs, they may file an appeal
with Social Security.with Social Security.98102 Enrollees may either submit a “Request for Reconsideration” Enrollees may either submit a “Request for Reconsideration”99103 or contact or contact
their local Social Security office to file an appeal. (An enrollee does not need to filetheir local Social Security office to file an appeal. (An enrollee does not need to file an appeal if an appeal if
he or she is requesting a new decision based on a life-changing event described above or if the he or she is requesting a new decision based on a life-changing event described above or if the
enrollee has shown that Social Security used the wrong information to make the original enrollee has shown that Social Security used the wrong information to make the original
decision.) decision.)
Income Categories and Premium Adjustments
Depending on their level of income, Medicare beneficiaries may be classified into one of six Depending on their level of income, Medicare beneficiaries may be classified into one of six
income categories.income categories.~~100 In 2021~~104 In 2022, individuals with incomes less than $, individuals with incomes less than $8891,000 a year ($,000 a year ($~~176~~182,000 for a ,000 for a
couple) pay the standard premium, which is based on 25% of the average Part B per capita cost. couple) pay the standard premium, which is based on 25% of the average Part B per capita cost.
Individuals with incomes over $Individuals with incomes over $8891,000 per year and couples with combined income over ,000 per year and couples with combined income over
$$~~176~~182,000 per year pay a higher percentage of Part B costs. Depending on one’s level of income ,000 per year pay a higher percentage of Part B costs. Depending on one’s level of income
over these threshold amounts, premiums may be adjusted to cover 35%, 50%, 65%, 80%, or 85% over these threshold amounts, premiums may be adjusted to cover 35%, 50%, 65%, 80%, or 85%
of the value of Part B coverage (with the rest being subsidized through federal general of the value of Part B coverage (with the rest being subsidized through federal general
~~revenues).101 Additional y, high-income individuals pay surcharges ranging from $4.20 to $10.20~~
~~per month to offset increased federal spending in 2021 due to premium reductions under BBA 15~~
~~and the Continuing Appropriations Act, 2021 and Other Extensions Act (P.L. 116-159) (compared~~
~~to a $3.00 surcharge for those who pay the standard premium). (See “Determining the Part B~~
~~Premium.”) In 2021, total IRMAAs for the five high-income levels, including the additional BBA~~
~~15 surcharges, are $59.40, $148.50, $237.60, $326.70, and $356.40 respectively.~~

~~95 Social Security Form SSA-44, at https://www.ssa.gov/forms/ssa-44-ext.pdf.~~
~~96 20 C.F.R. §418.1205.~~
~~97 20 C.F.R. §418.1210.~~
~~98 See SSA~~ 96 Internal Revenue Code §61. 97 Internal Revenue Code §62. 98 The definition of MAGI for the income-related monthly adjustment amount (IRMAA) in Medicare is different from the MAGI definition in certain ACA Medicaid provisions. See CRS Report R43861, The Use of Modified Adjusted Gross Income (MAGI) in Federal Health Programs. 99 Social Security Form SSA-44, at https://www.ssa.gov/forms/ssa-44-ext.pdf. 100 20 C.F.R. §418.1205. 101 20 C.F.R. §418.1210. 102 See SSA publication, publication, What You Can Do if You Think Your Medicare Income-Related Premium is Incorrect, at at
https://www.ssa.gov/pubs/EN-05-10125.pdf. https://www.ssa.gov/pubs/EN-05-10125.pdf.
99103 Social Social Security Form SSA-561-U2,Security Form SSA-561-U2, at http://www.ssa.gov/online/ssa-561.pdf. at http://www.ssa.gov/online/ssa-561.pdf.
~~100~~104 Social Social ~~Security Act §1839(i).~~
~~101 In 2020, approximately 4.6 million beneficiaries paid high-income premiums. About 36% of these were in the first~~
~~(lowest) income tier, 22% in the second, 12% in the third, about 2 4% in the fourth, and about 6% in the highest tier.~~
~~Figures provided by CMS, May 2021.~~
~~Congressional Research Service~~

19

~~link to page 24 link to page 24 link to page 24 link to page 25~~ ~~Medicare Part B: Enrollment and Premiums~~

~~The income categories and associated premiums for 2021, including the applicable BBA 15~~ Security Act §1839(i). Congressional Research Service 20 link to page 25 link to page 25 link to page 25 Medicare Part B: Enrollment and Premiums revenues).105 Additionally, high-income individuals pay surcharges ranging from $4.20 to $10.20 per month to offset increased federal spending in 2022 due to premium reductions under the Continuing Appropriations Act, 2021 and Other Extensions Act (P.L. 116-159) (compared to a $3.00 surcharge for those who pay the standard premium). (See “Determining the Part B Premium.”) In 2022, total IRMAAs for the five high-income levels, including the additional surcharges, are $68.00, $170.00, $272.20, $374.20, and $408.20 respectively. The income categories and associated premiums for 2022, including the applicable P.L. 116-159
repayment surcharges, are shown below irepayment surcharges, are shown below in Table 2. When both members of a couple are enrolled When both members of a couple are enrolled
in Part B, each pays the applicable premium amount. in Part B, each pays the applicable premium amount.
Table 2. Monthly Medicare Part B Premiums for ~~2021~~2022
Income-
Levels of Premium
Beneficiaries
Related
Total
Adjustment and
Who File an
Beneficiaries
Monthly
Monthly
Percentage of
Individual Tax
Who File a Joint
Adjustment
Premium
Costs Covered by
Return with
Tax Return with
Amount
(premium (premium + +
Premiums
Income
~~Income~~aInco mea
(IRMAA)b
surcharge) surcharge)
Standard (25%) Less ~~(25%)~~
~~Less~~ than or equal than or equal
Less Less than or equal than or equal
n/a n/a
$ $~~148.50~~170.10
to $ to $8891,000 ,000
to $ to $~~176~~182,000 ,000
High Income

Level 1 (35%)
Greater Greater than than
Greater Greater than than
$ $~~59.40~~
~~207.90~~
~~$88~~68.00 238.10 $91,000 and less ,000 and less
$ $~~176~~182,000 and less ,000 and less
than or equal to than or equal to
than or equal to than or equal to
$ $~~111~~114,000 ,000
$ $~~222~~228,000 ,000
Level 2 (50%)
Greater Greater than than
Greater Greater than 170.10 340.20 $114~~than~~
~~148.50~~
~~297.00~~
~~$111~~,000 and less ,000 and less
$ $~~222~~228,000 and less ,000 and less
than or equal to than or equal to
than or equal to than or equal to
$ $~~138~~142,000 ,000
$ $~~276~~284,000 ,000
Level 3 (65%)
Greater Greater than than
Greater Greater than 272.20 442.30 $142~~than~~
~~237.60~~
~~386.10~~
~~$138~~,000 and less ,000 and less
$ $~~276~~284,000 and less ,000 and less
than or equal to than or equal to
than or equal to than or equal to
$ $~~165~~170,000 ,000
$ $~~330~~340,000 ,000
Level 4 (80%)
Greater Greater than than
Greater Greater than 374.20 544.30 $170~~than~~
~~326.70~~
~~475.20~~
~~$165~~,000 and less ,000 and less
$ $~~330~~340,000 and less ,000 and less
than $500,000 than $500,000
than $750,000 than $750,000
Level 5 (85%)
Greater Greater than or than or
Greater Greater than or than or
~~356.40~~
~~504.90~~408.20 578.30
equal to $500,000 equal to $500,000
equal to $750,000 equal to $750,000
Source: CMS, “Medicare Program: CMS, “Medicare Program: Medicare Part B Monthly Actuarial Rates, PremiumMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Rate, and Annual
Deductible Beginning January 1, Deductible Beginning January 1, ~~2021,” 85~~2022,” 86 Federal Register ~~71904~~64205, November, November ~~12, 2020~~ 17, 2021. .
Notes: The hold-harmless The hold-harmless provision does not apply to individuals in the high-income categories.provision does not apply to individuals in the high-income categories. n/a = not n/a = not
applicable. Income thresholds are based on a Medicare-specificapplicable. Income thresholds are based on a Medicare-specific definition of modified adjusted grossdefinition of modified adjusted gross income income
(MAGI). (MAGI).
a. Couples with a joint incomea. Couples with a joint income of $of $~~176~~182,000 or less,000 or less could pay different premiumcould pay different premium amounts if one of them amounts if one of them
qualified to be held harmless qualified to be held harmless and the other did not. Membersand the other did not. Members of a couple in the high-income categoriesof a couple in the high-income categories both both
pay the samepay the same applicable income-adjusted premiumapplicable income-adjusted premium amount. amount.
b. Total income-related b. Total income-related monthly adjustment amounts (IRMAAs) are the amounts by which total monthly monthly adjustment amounts (IRMAAs) are the amounts by which total monthly
premiums premiums exceed the standard premiumexceed the standard premium ~~($148.50).~~
~~Married persons who lived with their spouse at some point during the year but who filed separate~~
~~returns are subject to different premium amounts. Such individuals may pay higher premiums at~~
~~lower income thresholds compared with those married couples who file joint tax returns.102 The~~
~~income levels and premium amounts are shown in Table 3.~~

~~102 T he different methodology for setting Medicare premiums for married filing separately was in the originating~~
~~legislation that created the high-income premiums for Part B (§811 of the Medicare Prescription Drug, Improvement,~~
~~and Modernization Act of 2003, P.L. 108-173, adding §1839(i)(3)(C)(iii) to the Social Security Act ). T he difference in~~
~~treatment between married filing jointly vs. married filing separately mirrors current IRS rules. T he IRS sets up tax~~
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~~link to page 25 link to page 26~~ ~~Medicare Part B: Enrollment and Premiums~~
($170.10). 105 In 2021, approximately 4.7 million beneficiaries paid high-income premiums. About 37% of these were in the first (lowest) income tier, 21% in the second, 12% in the third, about 24% in the fourth, and about 7% in the highest tier. Figures provided by CMS, April 2022. Congressional Research Service 21 link to page 26 link to page 26 Medicare Part B: Enrollment and Premiums Married persons who lived with their spouse at some point during the year but who filed separate returns are subject to different premium amounts. Such individuals may pay higher premiums at lower income thresholds compared with those married couples who file joint tax returns.106 The income levels and premium amounts are shown in Table 3.
Table 3. Part B Premium Adjustment for Married Beneficiaries
Filing Separately for ~~2021~~2022
Beneficiaries Who Are Married
Income-Related
and Lived with Their Spouse at
Monthly
Total Monthly
Any Time During the Year but
Adjustment
Premium
File a Separate Tax Return from
Amount
(premium (premium + +
Their Spouse with Income
(IRMAA)a
surcharge) surcharge)
Less Less Than or Equal to $Than or Equal to $8891,000 ,000
n/a n/a
$ $~~148.50~~170.10

Greater Greater Than $Than $8891,000 and less ,000 and less
$ $~~326.70~~
~~475.20~~374.20 544.30
than $ than $~~412~~409,000 ,000
Greater Greater than or equal to than or equal to
~~356.40~~
~~504.90~~
~~$412,000~~$49,000 408.20 578.30
Source: CMS, “Medicare Program:CMS, “Medicare Program: Medicare Part B Monthly Actuarial Rates, PremiumMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Rate, and Annual
Deductible Beginning January 1, Deductible Beginning January 1, ~~2021,” 85~~2022,” 86 Federal Register ~~71904~~64205, November, November ~~12, 2020.~~
17, 2021. Notes: n/a = not applicable. Income thresholds are based on a Medicare-specific n/a = not applicable. Income thresholds are based on a Medicare-specific definition of modified adjusted definition of modified adjusted
gross incomegross income (MAGI). (MAGI).
a. Total income-relateda. Total income-related monthly adjustment amounts (IRMAAs) are the amounts by which total monthly monthly adjustment amounts (IRMAAs) are the amounts by which total monthly
premiums premiums exceed the standard premiumexceed the standard premium ~~($148.50~~ ($170.10). ).
Legislative Changes to Income Thresholds
The original provision establishing the Part B income-related premiums set the initialThe original provision establishing the Part B income-related premiums set the initial income income
threshold and high-income-level ranges. Prior to 2010, annual adjustments to these levels were threshold and high-income-level ranges. Prior to 2010, annual adjustments to these levels were
based on annual changes in the consumer price index for urban consumers (CPI-U), rounded to based on annual changes in the consumer price index for urban consumers (CPI-U), rounded to
the nearest $1,000. However, Section 3402 of the Patient Protection and Affordable Care Act the nearest $1,000. However, Section 3402 of the Patient Protection and Affordable Care Act
(ACA;(ACA; P.L. 111-148, as amended) froze the income thresholds and ranges at the 2010 level P.L. 111-148, as amended) froze the income thresholds and ranges at the 2010 level
through 2019 rather than through 2019 rather than ~~al owing~~allowing them to rise with inflation. them to rise with inflation.~~103~~107 As a result, as incomes have As a result, as incomes have
increased with inflation, a greater share of Medicare enrollees have reached the high-income increased with inflation, a greater share of Medicare enrollees have reached the high-income
thresholds and are paying the high-income premiums than would have been the case without this thresholds and are paying the high-income premiums than would have been the case without this
freeze.freeze.
~~Additional y,~~ Additionally, beginning in 2018, the Medicare Access and CHIP Reauthorization Act of 2015 beginning in 2018, the Medicare Access and CHIP Reauthorization Act of 2015
(MACRA; P.L. 114-10) changed the income thresholds of the top two income categories at that (MACRA; P.L. 114-10) changed the income thresholds of the top two income categories at that
~~time.104 Individuals with incomes between $133,500 and $160,000 per year were moved into the~~
~~65% applicable percentage category (which previously only applied to those with incomes~~
~~between $160,000 and $214,000 in 2010-2017). The income threshold for the highest category at~~
~~that time (80%) was changed to $160,000 (which previously applied to those earning $214,000 or~~
~~more in 2010-2017). The thresholds for the lower two income categories were not changed. (See~~
Table 4.)

106 The different methodology for setting Medicare premiums for married filing separately was in the originating legislation that created the high-income premiums for Part B (§811 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, P.L. 108-173, adding §1839(i)(3)(C)(iii) to the Social Security Act). The difference in treatment between married filing jointly vs. married filing separately mirrors current IRS rules. The IRS sets up tax brackets differently for married filing jointly and married filing separately; deductions and tax credits are also limited brackets differently for married filing jointly and married filing separately; deductions and tax credits are also limited
for those filing separately. for those filing separately.
~~103~~107 ACA §3402. Because ACA §3402. Because more beneficiariesmore beneficiaries are expected to pay this higher premium over time and therefore reduce the are expected to pay this higher premium over time and therefore reduce the
amount of general revenues neededamount of general revenues needed to fund Part B, CBOto fund Part B, CBO scored this provision as saving the federal government $25 scored this provision as saving the federal government $25
billion over 10 years (FY2010-FY2019), at http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/113xx/doc11379/billion over 10 years (FY2010-FY2019), at http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/113xx/doc11379/
amendreconprop.pdf. amendreconprop.pdf.
~~104 MACRA §402. See CRS Report R43962,~~ ~~The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA;~~
~~P.L. 114-10)~~.
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time.108 Individuals with incomes between $133,500 and $160,000 per year were moved into the 65% applicable percentage category (which previously only applied to those with incomes between $160,000 and $214,000 in 2010-2017). The income threshold for the highest category at that time (80%) was changed to $160,000 (which previously applied to those earning $214,000 or more in 2010-2017). The thresholds for the lower two income categories were not changed. (See Table 4.) Table 4. Changes to the Medicare High-Income Premium Thresholds: 2017 to 2020
Levels of Premium
Beneficiaries Who Filed Individual Tax
Beneficiaries Who Filed Joint Tax Returns
Adjustment and
Returns ~~with~~ with Income:
with Income:
Percentage of Costs
Covered by
Premiums
2017
2018
2019
2020a2020a
2017
2018
2019
2020a2020a
Standard (25%) Standard (25%)
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
or equal or equal
or equal or equal
or equal or equal
Less Less than than
or equal or equal
or equal or equal
or equal or equal
or equal or equal
to to
to to
to to
or equal to or equal to
to to
to to
to to
to to
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$87,000 $87,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$174,000 $174,000
High Income

Level Level 1 (35%) 1 (35%)
$85,00 $85,001b-
$85,001- $85,001-
$85,001- $85,001-
$87,001- $87,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$174,001- $174,001-
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$109,000 $109,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$218,000 $218,000
Level Level 2 (50%) 2 (50%)
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$109,001- $109,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$218,001- $218,001-
$160,000 $160,000
$133,500 $133,500
$133,500 $133,500
$136,000 $136,000
$320,000 $320,000
$267,000 $267,000
$267,000 $267,000
$272,000 $272,000
Level Level 3 (65%) 3 (65%)
$160,001- $160,001-
$133,501- $133,501-
$133,501- $133,501-
$136,001- $136,001-
$320,001- $320,001-
$276,001- $276,001-
$267,001- $267,001-
$272,001- $272,001-
$214,000 $214,000
$160,000 $160,000
$160,000 $160,000
$163,000 $163,000
$428,000 $428,000
$320,000 $320,000
$320,000 $320,000
$326,000 $326,000
Level Level 4 (80%) 4 (80%)
More than More than
More than More than
$160,001- $160,001-
$163,001- $163,001-
More than More than More than More than
$320,001- $320,001-
$326,001- $326,001-
$214,000 $214,000
$160,000 $160,000
$499,999 $499,999
$499,999 $499,999
$428,000 $428,000
$320,000 $320,000
$749,99 $749,999b
$749,99 $749,999b
Level Level 5 (85%) 5 (85%)
$500,000 $500,000
$500,000 $500,000
$750,000 $750,000
$750,000 $750,000
n/a n/a
n/a n/a
or more or more
or more or more
n/a n/a
n/a n/a
or more or more
or more or more
Source: CMS, Annual Notices,CMS, Annual Notices, “Medicare Program; Medicare“Medicare Program; Medicare Part B Monthly Actuarial Rates, PremiumPart B Monthly Actuarial Rates, Premium Rate, Rate,
and Annual Deductible,” for 2017, 2018, 2019, and 2020. and Annual Deductible,” for 2017, 2018, 2019, and 2020.
Notes: Income thresholds are based on a Medicare-specificIncome thresholds are based on a Medicare-specific definition of modified adjusted grossdefinition of modified adjusted gross income income
(MAGI). 2018 was the first applicable year of the income(MAGI). 2018 was the first applicable year of the income threshold changes made by the Medicare Accessthreshold changes made by the Medicare Access and and
CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-10); 2019 is the first year that the income category CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-10); 2019 is the first year that the income category
changes made by the Bipartisan Budget Act of 2018 (BBA 18; P.L.changes made by the Bipartisan Budget Act of 2018 (BBA 18; P.L. 115-123) applied; 2020 is the first year since 115-123) applied; 2020 is the first year since
2009 that the thresholds were adjusted for inflation. 2009 that the thresholds were adjusted for inflation.
a. Income thresholds for a. Income thresholds for ~~2021~~2022 are shown i are shown in Table 2. ~~Historical~~ Historical income thresholds may be found income thresholds may be found inin Table B-
1 ~~in Appendix B~~. .
b. Bottom thresholds in Levels b. Bottom thresholds in Levels 1 through 4 rounded up to the nearest dol ar and upper threshold in 2019 and 1 through 4 rounded up to the nearest dol ar and upper threshold in 2019 and
2020 Level 4 rounded down to the nearest dol ar; n/a = not applicable. 2020 Level 4 rounded down to the nearest dol ar; n/a = not applicable.
With the exception of the addition of a new top threshold category described below, the 2019 With the exception of the addition of a new top threshold category described below, the 2019
income thresholds for the high-income categories were the same as in 2018. For years 2020 and income thresholds for the high-income categories were the same as in 2018. For years 2020 and
after, the thresholds are adjusted after, the thresholds are adjusted ~~annual y~~annually for inflation.109 108 MACRA §402. See CRS Report R43962, The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-10). 109 Under prior law (ACA §3402), in 2020 and subsequent years, the income thresholds were to be indexed to inflation as if they had not been frozen between 2011 and 2019. In other words, the income thresholds would have reverted to the levels they would have reached had they been indexed for inflation since 2007, thereby reducing the proportion of beneficiaries who would be subject to higher premiums. CBO estimated that MACRA §402 would save $34.3 billion Congressional Research Service 23 link to page 27 Medicare Part B: Enrollment and Premiums ~~for inflation based on the new (2018 and 2019)~~
~~threshold levels.105~~
Section 53114 of the Bipartisan Budget Act of 2018 (BBA Section 53114 of the Bipartisan Budget Act of 2018 (BBA 18; P.L. 115-123) added an additional 18; P.L. 115-123) added an additional
high-income category beginning in 2019 for individuals with annual income of $500,000 or more high-income category beginning in 2019 for individuals with annual income of $500,000 or more
or couples filing jointly with income of $750,000 or more. (or couples filing jointly with income of $750,000 or more. (SeeSee Table 4.)) Enrollees with income Enrollees with income
equal to or exceeding these thresholds pay premiums that cover 85% of the average per capita equal to or exceeding these thresholds pay premiums that cover 85% of the average per capita
cost of the Parts B and D benefits instead of 80%. The threshold for couples filing jointly in this cost of the Parts B and D benefits instead of 80%. The threshold for couples filing jointly in this
new income tier is calculated as 150% of the individualnew income tier is calculated as 150% of the individual income level rather than 200% as in the other income tiers. This new top income threshold will be frozen through 2027 and will be adjusted annually for inflation starting in 2028 based on the CPI-U.110~~income level rather than 200% as in the~~

~~105 Under prior law (ACA §3402), in 2020 and subsequent years, the income thresholds were to be indexed to inflation~~
~~as if they had not been frozen between 2011 and 2019. In other words, the income thresholds would have revert ed to~~
~~the levels they would have reached had they been indexed for inflation since 2007, thereby reducing the proportion of~~
~~beneficiaries who would be subject to higher premiums. CBO est imated that MACRA §402 would save $34.3 billion~~
~~over 10 years. CBO, Cost Estim ate of H.R. 2, Medicare Access and CHIP Reauthorization Act of 2015 , March 25,~~
~~2015, https://www.cbo.gov/publication/50053.~~
~~Congressional Research Service~~

22

~~Medicare Part B: Enrollment and Premiums~~

~~other income tiers. This new top income threshold wil be frozen through 2027 and wil be~~
~~adjusted annual y for inflation starting in 2028 based on the CPI-U.106~~
Premium Assistance for Low-Income Beneficiaries
Medicare beneficiaries with limited incomes and resources may be able to qualify for assistance Medicare beneficiaries with limited incomes and resources may be able to qualify for assistance
with their premiums and other out-of-pocket expenses.with their premiums and other out-of-pocket expenses.~~107~~111 About one in five Medicare About one in five Medicare
beneficiaries receives Part B premium subsidies. beneficiaries receives Part B premium subsidies.
Medicare beneficiaries who qualify for full Medicaid benefits ( Medicare beneficiaries who qualify for full Medicaid benefits (full dual-eligibles) have most of ) have most of
their health care expenses paid for by either Medicare or Medicaid. For these individuals, their health care expenses paid for by either Medicare or Medicaid. For these individuals,
Medicaid covers the majority of Medicare premium and cost-sharing expenses, and it Medicaid covers the majority of Medicare premium and cost-sharing expenses, and it
supplements Medicare by providing coverage for services not covered under Medicare, such as supplements Medicare by providing coverage for services not covered under Medicare, such as
dental services and long-term services and supports. In cases where services are covered by both dental services and long-term services and supports. In cases where services are covered by both
Medicare and Medicaid, Medicare pays first and Medicaid picks up most of the remaining costs. Medicare and Medicaid, Medicare pays first and Medicaid picks up most of the remaining costs.
Each state has different rules about eligibilityEach state has different rules about eligibility and applying for Medicaid.and applying for Medicaid.~~108~~
112 Beneficiaries who do not meet their respective state’s eligibility Beneficiaries who do not meet their respective state’s eligibility criteria for Medicaid may criteria for Medicaid may ~~stil~~
still qualify for assistance with Part B premiums if they have incomes of less than 135% of the federal qualify for assistance with Part B premiums if they have incomes of less than 135% of the federal
poverty level (FPL) and assets of less than $poverty level (FPL) and assets of less than $~~7,970~~8,400 for an individual or $ for an individual or $~~11,960~~12,600 for a couple in for a couple in
~~2021.109~~2022.113 These assistance programs are commonly referred to as These assistance programs are commonly referred to as Medicare Savings Programs
(MSPs).(MSPs).~~110~~114 Three of these programs provide assistance with Part B premiums. The type of Three of these programs provide assistance with Part B premiums. The type of
assistance is based on a beneficiary’s level of income. assistance is based on a beneficiary’s level of income.
~~Qualified Medicare Beneficiaries~~
~~Aged or disabled persons with incomes at or below FPL may qualify for the Qualified Medicare~~
~~Beneficiary (QMB) program.111 In 2021, the QMB monthly qualifying income levels are $1,094~~

~~106 T hese~~ over 10 years. CBO, Cost Estimate of H.R. 2, Medicare Access and CHIP Reauthorization Act of 2015, March 25, 2015, https://www.cbo.gov/publication/50053. 110 These threshold changes also apply to Part D income-related monthly adjustments. CBO estimated that the changes threshold changes also apply to Part D income-related monthly adjustments. CBO estimated that the changes
in this provision wouldin this provision would save approximately $1.6 billion from 2018 to 2027. CBO, “save approximately $1.6 billion from 2018 to 2027. CBO, “ Direct Spending and Revenue Direct Spending and Revenue
Effects of Division E of Senate Amendment 1930, the Bipartisan Budget Act of 2018Effects of Division E of Senate Amendment 1930, the Bipartisan Budget Act of 2018 ,” February 8, 2018, at ,” February 8, 2018, at
https://www.cbo.gov/publication/53557. https://www.cbo.gov/publication/53557.
~~107~~111 See See Medicare.gov, “Medicare SavingsMedicare.gov, “Medicare Savings Programs,” at http://www.medicare.gov/your-medicare-costs/help-paying-Programs,” at http://www.medicare.gov/your-medicare-costs/help-paying-
costs/medicare-savings-program/medicare-savings-programs.html and Medicare Publication, “costs/medicare-savings-program/medicare-savings-programs.html and Medicare Publication, “ Get Help with Your Get Help with Your
Medicare Costs,” at https://www.medicare.gov/pubs/pdf/10126-Getting-Help-With-Your-Medicare-Costs.pdf. Medicare Costs,” at https://www.medicare.gov/pubs/pdf/10126-Getting-Help-With-Your-Medicare-Costs.pdf.
SubsidiesSubsidies are also availableare also available for low-income beneficiariesfor low-income beneficiaries enrolled in Part D, the outpatient prescription drug benefit. enrolled in Part D, the outpatient prescription drug benefit.
~~T hose~~Those who are eligible who are eligible for assistance with Part B premiums through their Medicaidfor assistance with Part B premiums through their Medicaid programs are automatically eligible programs are automatically eligible
to receive the Part D low-income subsidy.to receive the Part D low-income subsidy. Other low-income beneficiaries with incomes belowOther low-income beneficiaries with incomes below 150% of the federal 150% of the federal
poverty level (FPL) and who meet the resource tests may also be eligiblepoverty level (FPL) and who meet the resource tests may also be eligible for the drugfor the drug subsidy.subsidy.
~~108 See CRS~~ 112 See CRS Report R43357, Report R43357, Medicaid: An Overview. In those states that have extended Medicaid. In those states that have extended Medicaid coverage to coverage to
individualsindividuals 64 years of age and under64 years of age and under with incomes of up to 138% of FPL, certain individualswith incomes of up to 138% of FPL, certain individuals at the higher income at the higher income
levels may no longer qualifylevels may no longer qualify for Medicaidfor Medicaid when they turn 65. In other words, traditional Medicaidwhen they turn 65. In other words, traditional Medicaid categorical and categorical and
income eligibility (i.e., income and asset) rulesincome eligibility (i.e., income and asset) rules ~~will~~ will apply when an individualapply when an individual becomes eligiblebecomes eligible for Medicare.for Medicare.
~~109~~ 113 Income and asset requirements may vary by state and change each year. Income and asset requirements may vary by state and change each year. ~~T hese~~These amounts do not include a burial-fund amounts do not include a burial-fund
allowance of $1,500 per person. Medicare.gov, “allowance of $1,500 per person. Medicare.gov, “ Medicare SavingsMedicare Savings Programs,” at http://www.medicare.gov/your-Programs,” at http://www.medicare.gov/your-
medicare-costs/help-paying-costs/medicare-savings-program/medicare-savings-programs.html. medicare-costs/help-paying-costs/medicare-savings-program/medicare-savings-programs.html.
~~110~~114 For additional information about these programs and to learn whether a beneficiary might qualify For additional information about these programs and to learn whether a beneficiary might qualify for Medicare for Medicare
premium assistance, contact the applicable State Medical Assistance (Medicaid)premium assistance, contact the applicable State Medical Assistance (Medicaid) office. (As the names of these Congressional Research Service 24 link to page 30 Medicare Part B: Enrollment and Premiums Qualified Medicare Beneficiaries Aged or disabled persons with incomes at or below FPL may qualify for the Qualified Medicare Beneficiary (QMB) program.115 In 2022, the QMB monthly qualifying income levels are $1,153for individuals and $1,546for a couple (annual income of about $13,836 and $18,552, respectively).116~~office. (As the names of these~~
~~programs may vary by state, one should specifically inquire about Medicare Savings Programs.) T he contact~~
~~information for state Medicaid offices may be obtained by calling 1 -800-MEDICARE (1-800-633-4227) or by visiting~~
~~the Medicare “ contacts” website at http://www.medicare.gov/contacts.~~
~~111 FPLs for 2021 are $12,880 per year for an individual and $17,420 for a couple. (T hese levels are slightly higher in~~
~~Congressional Research Service~~

23

~~link to page 29~~ ~~Medicare Part B: Enrollment and Premiums~~

~~for individuals and $1,472 for a couple (annual income of about $13,128 and $17,664,~~
~~respectively).112~~ QMBs are entitled to have their Medicare Parts A and B cost-sharing charges, QMBs are entitled to have their Medicare Parts A and B cost-sharing charges,
including the Part B premium and including the Part B premium and al all deductibles and coinsurance, paid by Medicaid.deductibles and coinsurance, paid by Medicaid.~~113~~117 (See (See
Table 5.)) For QMBs, Medicaid coverage is limited For QMBs, Medicaid coverage is limited to the payment of Medicare premiums and to the payment of Medicare premiums and
cost-sharing charges (i.e., the Medicare beneficiary is cost-sharing charges (i.e., the Medicare beneficiary is not entitled to coverage of Medicaid plan entitled to coverage of Medicaid plan
services, unless the individual is otherwise entitled to Medicaid). services, unless the individual is otherwise entitled to Medicaid).
Specified Low-Income Medicare Beneficiaries
Individuals whose income is more than 100% but less than 120% of FPL may qualify for Individuals whose income is more than 100% but less than 120% of FPL may qualify for
assistance as a Specified Low-Income Medicare Beneficiary (SLMB). In assistance as a Specified Low-Income Medicare Beneficiary (SLMB). In ~~2021~~2022, the monthly , the monthly
income limits are $1,income limits are $1,~~308 for~~379for an individual and $1, an individual and $1,~~762 for~~851for a couple (annual income of about a couple (annual income of about
$$~~15,696 and $21,144~~16,548 and $22,212 respectively). respectively).~~114~~118 Medicaid pays the Medicare Part B premiums for SLMBs, Medicaid pays the Medicare Part B premiums for SLMBs,
but not other cost sharing. but not other cost sharing.
Qualifying Individuals
Individuals whose income is between 120% and 135% of FPL may qualify for assistance as Individuals whose income is between 120% and 135% of FPL may qualify for assistance as
Qualifying Individuals (QIs). In Qualifying Individuals (QIs). In ~~2021~~2022, the monthly income limit for a QI is $1,, the monthly income limit for a QI is $1,~~469 for~~549for an an
individual,individual, and for a couple, it is $and for a couple, it is $~~1,980~~2,080 (annual income of about $ (annual income of about $~~17,628 and $23,760~~18,588 and $24,960, ,
respectively). Medicaid protection for these individuals is limited to payment of the monthly respectively). Medicaid protection for these individuals is limited to payment of the monthly
Medicare Part B premium. Expenditures under the QI program are, however, paid for (100%) by Medicare Part B premium. Expenditures under the QI program are, however, paid for (100%) by
the federal government from the Medicare SMI Trust Fund up to the state’s the federal government from the Medicare SMI Trust Fund up to the state’s ~~al ocation~~allocation level. level.~~115~~119 A A
state is required to cover only the number of people that would bring the state’s spending on these state is required to cover only the number of people that would bring the state’s spending on these
population groups in a year up to its population groups in a year up to its ~~al ocation~~allocation level. Any expenditures beyond that level are level. Any expenditures beyond that level are
~~voluntary and paid entirely by the state.~~
~~Funding for the QI program was first made available by the Balanced Budget Act of 1997~~
~~(BBA97; P.L. 105-33).116 Subsequent legislation extended the program and the amounts available~~
~~through al ocation.117 MACRA permanently extended the QI program.118~~

~~Alaska and Hawaii.) See The 2021 HHS Poverty Guidelines at https://aspe.hhs.gov/poverty-guidelines.~~
~~112 T he~~voluntary and paid entirely by the state. programs may vary by state, one should specifically inquire about Medicare Savings Programs.) The contact information for state Medicaid offices may be obtained by calling 1-800-MEDICARE (1-800-633-4227) or by visiting the Medicare “contacts” website at http://www.medicare.gov/contacts. 115 FPLs for 2022 are $13,590per year for an individual and $18,310for a couple. (These levels are slightly higher in Alaska and Hawaii.) See HHS Poverty Guidelines for 2022, at https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines. 116 The qualifying levels are slightly higher than the monthly federal poverty level because, by law, qualifying levels are slightly higher than the monthly federal poverty level because, by law, $20 per month of $20 per month of
unearned income is disregardedunearned income is disregarded inin the calculation. Seethe calculation. See “ “Medicare SavingsMedicare Savings Programs,” at https://www.medicare.gov/Programs,” at https://www.medicare.gov/
your-medicare-costs/get-help-paying-costs/medicare-savings-programs. your-medicare-costs/get-help-paying-costs/medicare-savings-programs.
~~113 T he~~ 117 The Qualified Medicare Qualified Medicare Beneficiary (QMB) program does not provide assistance with drugBeneficiary (QMB) program does not provide assistance with drug costs. Low-income costs. Low-income
beneficiaries who qualifybeneficiaries who qualify for a Medicare Savingsfor a Medicare Savings Program are automatically enrolled in Medicare Part D; their Program are automatically enrolled in Medicare Part D; their
premiums and most cost sharing are paid for by the Part D low-income subsidy,premiums and most cost sharing are paid for by the Part D low-income subsidy, which iswhich is financed through Medicare. financed through Medicare.
States pay some of the costs for Part D low-income assistance through state transfer payments. States pay some of the costs for Part D low-income assistance through state transfer payments.
~~114 T he~~118 The qualifying levels are calculated the same way as for the QMB program. qualifying levels are calculated the same way as for the QMB program.
~~115~~119 In general, Medicaid In general, Medicaid payments are shared between the federal government and the states according to matching payments are shared between the federal government and the states according to matching
formulas. formulas.
~~116 §4732(c) of BBA 97 added §1933(c) of the Social Security Act.~~
~~117 See CRS Report R43958, Health Care-Related Expiring Provisions, First Session of the 114th Congress.~~
~~118 MACRA appropriated $535 million for the remainder of CY2015 (April 1, 2015, through December 31, 2015) and~~
~~$980 million for CY2016. T he amount of funding for CY2017 and subsequent calendar years is based on the product of~~
~~the following: (1) the previous year’s Qualifying Individuals (QI) allocation; (2) the increase from the previous year in~~
~~Medicare Part B premium; and (3) the estimated increase from the previous year in Part B en rollment. See CRS Report~~
~~R43962, The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P.L. 114 -10).~~
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~~link to page 29 link to page 29 link to page 29 link to page 29 link to page 29 link to page 29~~ ~~Medicare Part B: Enrollment and Premiums~~

~~Table 5. 2021~~ Congressional Research Service 25 link to page 30 link to page 30 link to page 30 link to page 30 link to page 30 link to page 30 Medicare Part B: Enrollment and Premiums Funding for the QI program was first made available by the Balanced Budget Act of 1997 (BBA97; P.L. 105-33).120 Subsequent legislation extended the program and the amounts available through allocation.121 MACRA permanently extended the QI program.122 Table 5. 2022 Medicare Savings Program Eligibility Standards

Monthly ~~Income~~a
Income a Resourcesb
Benefits
Qualified Medicare Qualified Medicare
At or Below At or Below 100% FP100% FPLc
$ $~~7,970~~8,400 (single) (single)
Part B Premiu Part B Premiumd
Beneficiary Beneficiary (QMB) (QMB)
$1, $1,~~094~~153 (single) (single)
$ $~~11,960~~12,600 (couple) (couple)
Coverage of Parts A and B Coverage of Parts A and B
$1, $1,~~472~~546 (couple) (couple)
Deductibles and Coinsurance Deductibles and Coinsurance
Specified Low-Income Specified Low-Income
Above 100% but Less Than Above 100% but Less Than
$ $~~7,970~~8,400 (single) (single)
Part B Premium Part B Premium
Medicare Beneficiary Medicare Beneficiary
120% FP 120% FPLc
~~$11,960~~ $12,600 (couple) (couple)
(SLMB) (SLMB)
$1, $1,~~094-$1,308~~153-$1,379 (single) (single)
$1,$1,~~472-$1,762~~546-$1,851 (couple) (couple)
Qualifying Individual Qualifying Individual
At or Above 120% but Less At or Above 120% but Less
$ $~~7,970~~8,400 (single) (single)
Part B Premium Part B Premium
(QI) (QI)
Than 135% FP Than 135% FPLc
$ $~~11,960~~12,600 (couple) (couple)
$1, $1,~~308-$1,469~~379-$1,549 (single) (single)
$1,$1,~~762-$1,980~~851-$2,080 (couple) (couple)
Source: Medicare.gov,Medicare.gov, “Medicare Savings Programs,”“Medicare Savings Programs,” at https://www.medicare.gov/your-medicare-costs/get-at https://www.medicare.gov/your-medicare-costs/get-
help-paying-costs/medicare-savings-programs. help-paying-costs/medicare-savings-programs.
a. These amounts include a $20 general income exclusion, under which $20 from any incomea. These amounts include a $20 general income exclusion, under which $20 from any income is not counted is not counted
toward the income limits. toward the income limits. CMS rounds up to the nearest dol ar when computing monthly income limits. CMS rounds up to the nearest dol ar when computing monthly income limits.
b. Resources b. Resources include money in checking and savings accounts, stocks, bonds, mutual funds, and Individual include money in checking and savings accounts, stocks, bonds, mutual funds, and Individual
Retirement Retirement Accounts (IRAs). ResourcesAccounts (IRAs). Resources do not include one’s primary residence,do not include one’s primary residence, a life insurance policy a life insurance policy
worth up to $1,500, one car, burial plots, up to $1,500 per person for burial worth up to $1,500, one car, burial plots, up to $1,500 per person for burial ~~ex penses~~expenses, and household , and household
items.items. ~~Some~~ Some states have no limitsstates have no limits on resources. on resources.
c. Federal c. Federal Poverty LevelsPoverty Levels (FPLs) are updated each year, (FPLs) are updated each year, ~~usual y~~usually in January or February. Income levels in January or February. Income levels are are
higher for higher for ~~Hawai~~ Hawaii and Alaskaand Alaska and for those living with dependents. and for those living with dependents.
d. Most people do not pay a premium d. Most people do not pay a premium for Part A because they have workedfor Part A because they have worked 40 or more40 or more quarters in covered quarters in covered
employment. employment. For those without sufficient work history to qualify for premium-freeFor those without sufficient work history to qualify for premium-free Part A, Medicaid wil Part A, Medicaid wil
also pay Part A premiumsalso pay Part A premiums for QMBs.for QMBs.
Protection of Social Security Benefits from Increases
in Medicare Part B Premiums
After a person becomes eligible to receive Social Security benefits, his or her monthly benefit After a person becomes eligible to receive Social Security benefits, his or her monthly benefit
amount is adjusted amount is adjusted ~~annual y~~annually to compensate for increases in the prices of goods and services over to compensate for increases in the prices of goods and services over
time.time.~~119~~123 Near the end of each year, the Social Security Administration announces the cost-of- Near the end of each year, the Social Security Administration announces the cost-of-
~~living adjustment (COLA) payable in January of the following year. The amount of the COLA is~~
~~based on inflation as measured by the Consumer Price Index-Urban Wage Earners and Clerical~~
~~Workers (CPI-W).120 If the CPI-W decreases, Social Security benefits stay the same—benefits are~~
~~not reduced during periods of deflation.~~
~~When the annual Social Security COLA is not sufficient to cover the standard Medicare Part B~~
~~premium increase, most Medicare beneficiaries are protected by a hold-harmless provision in the~~

~~119 For more information, see CRS Report R42035, Social Security Primer, and CRS Report 94-803,~~ ~~Social Security:~~
~~Cost-of-Living Adjustm ents~~.
~~120 T he Consumer Price Index-Urban Wage Earners and Clerical Workers (CPI-W) tracks the prices of a fixed market~~
~~basket of goods and services over time. Social Security’s cost-of-living adjustment (COLA) is calculated as the change~~
~~in the CPI-W from the third quarter of the prior calendar year to the third quarter of the current c alendar year. If the~~
~~CPI-W increases during this period, Social Security benefits for the next year increase proportionately.~~
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~~link to page 51~~ ~~Medicare Part B: Enrollment and Premiums~~

~~Social Security Act.121 Specifical y~~ 120 §4732(c) of BBA 97 added §1933(c) of the Social Security Act. 121 See CRS Report R43958, Health Care-Related Expiring Provisions, First Session of the 114th Congress. 122 MACRA appropriated $535 million for the remainder of CY2015 (April 1, 2015, through December 31, 2015) and $980 million for CY2016. The amount of funding for CY2017 and subsequent calendar years is based on the product of the following: (1) the previous year’s Qualifying Individuals (QI) allocation; (2) the increase from the previous year in Medicare Part B premium; and (3) the estimated increase from the previous year in Part B enrollment. See CRS Report R43962, The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-10). 123 For more information, see CRS Report R42035, Social Security Primer, and CRS Report 94-803, Social Security: Cost-of-Living Adjustments. Congressional Research Service 26 link to page 53 Medicare Part B: Enrollment and Premiums living adjustment (COLA) payable in January of the following year. The amount of the COLA is based on inflation as measured by the Consumer Price Index-Urban Wage Earners and Clerical Workers (CPI-W).124 If the CPI-W decreases, Social Security benefits stay the same—benefits are not reduced during periods of deflation. When the annual Social Security COLA is not sufficient to cover the standard Medicare Part B premium increase, most Medicare beneficiaries are protected by a hold-harmless provision in the Social Security Act.125 Specifically, if in a given year the increase in the standard Part B premium , if in a given year the increase in the standard Part B premium
would cause a beneficiary’s Social Security check to be less, in dollar terms, than it was the year would cause a beneficiary’s Social Security check to be less, in dollar terms, than it was the year
before, then the Part B premium is reduced to ensure that the amount of the individual’s Social before, then the Part B premium is reduced to ensure that the amount of the individual’s Social
Security check does not decline.Security check does not decline.~~122~~126 This determination is made by the Social Security This determination is made by the Social Security
Administration. Administration.
To be held harmless in a given year, a Social Security beneficiary must have received Social To be held harmless in a given year, a Social Security beneficiary must have received Social
Security benefit checks in both December of the previous year and January of the current year, Security benefit checks in both December of the previous year and January of the current year,
and the beneficiary must also have had Part B premiums deducted from both checks.and the beneficiary must also have had Part B premiums deducted from both checks.~~123~~127 The hold- The hold-
harmless provision operates by comparing the net dollar amounts of the two monthly benefit harmless provision operates by comparing the net dollar amounts of the two monthly benefit
payments; if the net Social Security benefit for January of the current year is lower than in payments; if the net Social Security benefit for January of the current year is lower than in
December of the previous year, then the hold-harmless provision applies to that person. Premiums December of the previous year, then the hold-harmless provision applies to that person. Premiums
of those held harmless are then reduced to an amount that would not cause their Social Security of those held harmless are then reduced to an amount that would not cause their Social Security
benefits to decline in the next year. The premium paid by those held harmless is benefits to decline in the next year. The premium paid by those held harmless is ~~cal ed~~called the the
VariableVariable Supplementary Medical Insurance premium.Supplementary Medical Insurance premium.~~124~~128 Those not held harmless pay the standard Those not held harmless pay the standard
premium as determined for that year.premium as determined for that year.
~~Typical y~~ Typically, the hold-harmless provision affects only a , the hold-harmless provision affects only a ~~smal~~ small number of beneficiaries and has had number of beneficiaries and has had
minimal impact on Part B financing.minimal impact on Part B financing.~~125~~129 In most years, this rule primarily protects those with In most years, this rule primarily protects those with
relatively low Social Security payments. However, in years in which there is no or a very low relatively low Social Security payments. However, in years in which there is no or a very low
Social Security COLA, such as in 2010, 2011, 2016, and 2017, a large number of beneficiaries Social Security COLA, such as in 2010, 2011, 2016, and 2017, a large number of beneficiaries
may be protected by this provision. (may be protected by this provision. (SeeSee Appendix E.) 124 The Consumer Price Index-Urban Wage Earners and Clerical Workers (CPI-W) tracks the prices of a fixed market basket of goods and services over time. Social Security’s cost-of-living adjustment (COLA) is calculated as the change in the CPI-W from the third quarter of the prior calendar year to the third quarter of the current calendar year. If the CPI-W increases during this period, Social Security benefits for the next year increase proportionately. 125 Social Security Act §1839(f). This Appendix E.)
~~Some Beneficiaries Are Not Protected by the Hold-~~
~~Harmless Provision~~
~~Not al beneficiaries are protected by the hold-harmless provision and, under some circumstances,~~
~~may be subject to significantly higher premiums than those who are held harmless. Groups that~~
~~are not protected include the following:~~
~~ Higher-Income Beneficiaries. Higher-income beneficiaries who are required to~~
~~pay income-related Part B premiums are explicitly excluded by law from~~

~~121 Social Security Act §1839(f). T his~~ provision was originally created by the Deficit Reduction Act of 1984 (P.L. 98- provision was originally created by the Deficit Reduction Act of 1984 (P.L. 98-
369, Section 2302), extended by subsequent369, Section 2302), extended by subsequent legislation, and made permanent by the Catastrophic Coverage Act of legislation, and made permanent by the Catastrophic Coverage Act of
1988 (P.L. 100-360, Section 211(b)) (this provision was not repealed when1988 (P.L. 100-360, Section 211(b)) (this provision was not repealed when that law wasthat law was repealed in 1989).repealed in 1989). ~~T hose~~ Those who who
receive RRBreceive RRB benefits are also protected by this provision. benefits are also protected by this provision. ~~T he~~The hold-harmless provision was first implemented in hold-harmless provision was first implemented in
January 1987. January 1987.
~~122~~ 126 For more information on For more information on ~~t he~~the hold-harmless provision, see CRS hold-harmless provision, see CRS Report R44224, Report R44224, Potential Impact of No Social
Security COLA on Medicare Part B ~~Prem ium s~~Premiums in 2016 .
~~123 Note that~~. 127 Social Security benefit checks reflect Social Security benefit checks reflect benefit entitlements for the previous month, whereas Part B benefit entitlements for the previous month, whereas Part B
premiums are premiums are ~~deducted~~ deducted in advance. For example, a November Socialin advance. For example, a November Social Security benefit check isSecurity benefit check is not received until not received until
December, but it has December’s Part B premium deductedDecember, but it has December’s Part B premium deducted from it. from it.
~~124~~128 SSA, SSA, Program Operations Manual System (POMS), Section HI 01001.004, “The Variable Supplementary Medical , Section HI 01001.004, “The Variable Supplementary Medical
Insurance Premium,” at https://secure.ssa.gov/poms.nsf/lnx/0601001004. Insurance Premium,” at https://secure.ssa.gov/poms.nsf/lnx/0601001004.
~~125 T he~~129 The hold-harmless provision is applied on a case-by-case basis. hold-harmless provision is applied on a case-by-case basis. For example, in a given year a SocialFor example, in a given year a Social Security Security
COLA applied to most benefit levels may be sufficient to cover the dollar amount of a Part B premium increase for COLA applied to most benefit levels may be sufficient to cover the dollar amount of a Part B premium increase for
most beneficiaries; however, it may not be sufficient to fully cover the increase for someone who receives a smaller most beneficiaries; however, it may not be sufficient to fully cover the increase for someone who receives a smaller
benefit amount, (i.e., the COLA percentage is applied to a smaller number, and the resulting dollar increase may not be benefit amount, (i.e., the COLA percentage is applied to a smaller number, and the resulting dollar increase may not be
sufficient to fully cover the Part B premium increase). In suchsufficient to fully cover the Part B premium increase). In such a case, the hold-harmless provision woulda case, the hold-harmless provision would apply to that apply to that
individual,individual, and his or her Part B premiums may be lowerand his or her Part B premiums may be lower than than ~~th ose~~those paid by most beneficiaries in a given year. paid by most beneficiaries in a given year. ~~T hus~~Thus, ,
the hold-harmless provision may apply to a small number of beneficiariesthe hold-harmless provision may apply to a small number of beneficiaries each yeareach year . .
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link to page link to page 2123 link to page link to page 2123 link to page link to page 2728 link to page link to page 2728 Medicare Part B: Enrollment and Premiums
Some Beneficiaries Are Not Protected by the Hold-Harmless Provision Not all beneficiaries are protected by the hold-harmless provision and, under some circumstances, may be subject to significantly higher premiums than those who are held harmless. Groups that are not protected include the following:  Higher-Income Beneficiaries. Higher-income beneficiaries who are required to pay income-related Part B premiums are explicitly excluded by law from
protection under the hold-harmless provision. They are required to pay the full protection under the hold-harmless provision. They are required to pay the full
amount of any increase in their Part B premiums. (See amount of any increase in their Part B premiums. (See “Income-Related
Premiums.”)”)
  Lower-Income Beneficiaries. Lower-income beneficiaries who receive premium Lower-income beneficiaries who receive premium
assistance from Medicaid are not held harmless as their premiums are not assistance from Medicaid are not held harmless as their premiums are not
deducted from their Social Security benefits. However, the Medicaid program deducted from their Social Security benefits. However, the Medicaid program
pays the full amount of any increase in their Part B premiums. (See pays the full amount of any increase in their Part B premiums. (See “Premium
Assistance for Low-Income Beneficiaries.”)
”)   Those Who Do Not Receive Social Security. This group includes those who This group includes those who
have not yet signed up for Social Security for various reasons, for example have not yet signed up for Social Security for various reasons, for example
~~because~~, they have deferred signing up because they have not reached full they have deferred signing up because they have not reached full
retirement retirement ~~age126~~age130 or or are still ~~are stil~~ working. It also includes disabled beneficiaries working. It also includes disabled beneficiaries
whose Social Security Disability Insurance (SSDI) cash benefits have been whose Social Security Disability Insurance (SSDI) cash benefits have been
discontinued because they have returned to work but who are discontinued because they have returned to work but who are ~~stil eligible for~~
~~Medicare.127 Additional y,~~ still eligible for Medicare.131 Additionally, those who receive benefits exclusively through a those who receive benefits exclusively through a
different retirement plan are not held harmless.different retirement plan are not held harmless.~~128~~132 This group includes certain This group includes certain
federal retirees under the Civil Service Retirement federal retirees under the Civil Service Retirement ~~System129 as wel~~ System133 as well as certain as certain
state and local government workers—such as teachers, law-enforcement state and local government workers—such as teachers, law-enforcement
personnel, and firefighters—who personnel, and firefighters—who have their own pension programs.134 130 See CRS Report R44670, The Social Security Retirement Age. 131 See CRS Report R41934, Ticket to Work and Self-Sufficiency Program: Overview and Current Issues; SSA, “The Redbook – A Guide to Work Incentives,” at https://www.ssa.gov/redbook/; and SSA, Disability Benefits for Wounded Warriors, at http://www.ssa.gov/pubs/EN-05-10030.pdf. Disabled military personnel may be required to ~~have their own pension programs.130~~
 Those Who Did Not Have Medicare Premiums Deducted from Their Social
Security Checks at the End of One Year and the Beginning of the Next. This
~~category includes those who enroll in Social Security or Medicare during the year~~
~~in which the hold-harmless provision is in effect, including SSDI recipients who~~
~~become eligible for Medicare that year after the 24-month waiting period.131 It~~
~~also includes those who had Medicare premiums paid on their behalf one year,~~
~~for example by Medicaid, but lost that coverage during the next year.~~

~~126 See CRS Report R44670, The Social Security Retirement Age.~~
~~127 See CRS Report R41934, Ticket to Work and Self-Sufficiency Program: Overview and Current Issues; SSA, “ T he~~
~~Redbook – A Guide to Work Incentives,” at https://www.ssa.gov/redbook/; and SSA,~~ ~~Disability Benefits For Wounded~~
~~Warriors, pp. 13-14, at http://www.ssa.gov/pubs/EN-05-10030.pdf. Disabled military personnel may be required to~~
enroll in Part B to maintain coverage under the Department of Defense health insurance, enroll in Part B to maintain coverage under the Department of Defense health insurance, ~~T RICARE~~TRICARE. Some persons . Some persons
with lowwith low incomes and limited resources may be eligibleincomes and limited resources may be eligible for state assistance with these costs underfor state assistance with these costs under various Medicare various Medicare
~~Savings~~ Savings Programs. Programs.
~~128~~ 132 A person who is entitled to Social Security spousal A person who is entitled to Social Security spousal benefits, basedbenefits, based on a spouse’s work record instead of his or her on a spouse’s work record instead of his or her
own work record, may or may not be covered by the hold-harmless provision. If the government pension offset (GPO) own work record, may or may not be covered by the hold-harmless provision. If the government pension offset (GPO)
werewere to reduce spousalto reduce spousal benefits to zero, then the individual wouldbenefits to zero, then the individual would not meet the hold-harmless provision’s requirement not meet the hold-harmless provision’s requirement
of having benefit checks for December of the previous year and January of the current year. of having benefit checks for December of the previous year and January of the current year. ~~T her efore~~Therefore, this person , this person
wouldwould not be held harmless. If the person were to receive a Socialnot be held harmless. If the person were to receive a Social ~~Security~~ Security spousal benefit for a positive dollar amount, spousal benefit for a positive dollar amount,
then he or she wouldthen he or she would be covered by the hold-harmless provision. For more on the GPO, see CRSbe covered by the hold-harmless provision. For more on the GPO, see CRS Report RL32453, Report RL32453,
Social Security: The ~~Governm ent~~Government Pension Offset (GPO) . .
~~129~~133 Federal employees who exclusively Federal employees who exclusively worked under the Civil Serviceworked under the Civil Service Retirement System (CSRS)Retirement System (CSRS) are not eligibleare not eligible for for
SocialSocial Security benefits basedSecurity benefits based on their own work record. Seeon their own work record. See ~~CRS~~ CRS Report 98-810, Report 98-810, Federal ~~Em ployees’ Retirem ent~~
~~System~~ Employees’ Retirement System: Benefits and Financing. . ~~T his~~This program uses the same measuring period and formula for determining its COLAs program uses the same measuring period and formula for determining its COLAs
as Socialas Social Security. SeeSecurity. See ~~CRS~~ CRS Report 94-834, Report 94-834, Cost-of-Living ~~Adjustm ents~~Adjustments for Federal Civil Service Annuities. .
~~130~~134 SSA, SSA, “ “How State and Local Government Employees Are Covered by SocialHow State and Local Government Employees Are Covered by Social Security and Medicare,” at Security and Medicare,” at
http://www.ssa.gov/pubs/EN-05-10051.pdf, and Socialhttp://www.ssa.gov/pubs/EN-05-10051.pdf, and Social ~~Security~~ Security Administration, “Administration, “ State and Local Government State and Local Government
Employers – Information,” at http://www.ssa.gov/slge/.Employers – Information,” at http://www.ssa.gov/slge/.
~~131 See CRS Report RS22195,~~ ~~Social Security Disability Insurance (SSDI) and Medicare: The 24 -Month Waiting~~
~~Period for SSDI Beneficiaries Under Age 65~~ .
~~Congressional Research Service~~

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~~link to page 12 link to page 51 link to page 40 link to page 34 link to page 21~~ ~~Medicare Part B: Enrollment and Premiums~~

~~Some people protected by the hold-harmless provision may stil~~ Congressional Research Service 28 link to page 12 link to page 53 link to page 22 Medicare Part B: Enrollment and Premiums  Those Who Did Not Have Medicare Premiums Deducted from Their Social Security Checks at the End of One Year and the Beginning of the Next. This category includes those who enroll in Social Security or Medicare during the year in which the hold-harmless provision is in effect, including SSDI recipients who become eligible for Medicare that year after the 24-month waiting period.135 It also includes those who had Medicare premiums paid on their behalf one year, for example by Medicaid, but lost that coverage during the next year. Some people protected by the hold-harmless provision may still see a decrease in their Social see a decrease in their Social
Security checks due to an increase in Medicare Part D premiums. Part D premiums are not Security checks due to an increase in Medicare Part D premiums. Part D premiums are not
covered by the hold-harmless provision, although beneficiaries with low-income subsidies would covered by the hold-harmless provision, although beneficiaries with low-income subsidies would
not be affected. not be affected.
~~Additional y,~~ Additionally, those who pay the late-enrollment penalty are not fully protected from the hold-those who pay the late-enrollment penalty are not fully protected from the hold-
harmless rule. (See harmless rule. (See “Late-Enrollment Premium Penalty and Exemptions.””) In a year in which the ) In a year in which the
hold-harmless provision is in effect, the late-enrollment surcharges are calculated as a percentage hold-harmless provision is in effect, the late-enrollment surcharges are calculated as a percentage
of the premiums of those not held harmless. These surcharges are considered “nonstandard” of the premiums of those not held harmless. These surcharges are considered “nonstandard”
premiums and thus are not limited by the hold-harmless provision. premiums and thus are not limited by the hold-harmless provision.
Application of the Hold-Harmless Rule in ~~2021~~
~~In 2021, the growth in Medicare premiums was limited by the Continuing Appropriations Act,~~
~~2021 and Other Extensions Act (P.L. 116-159); therefore the 1.3% Social Security COLA for~~
~~2021 was large enough to cover the full $3.90 increase in Part B premiums (from $144.60 to~~
~~$148.50 per month) for most beneficiaries, and only 2% (about 1.2 mil ion)132 are being held~~
~~harmless in 2021.133 (~~2022 The 2022 Social Security COLA of 5.9%, was large enough to cover the full amount of the $21.60 Part B premium increase (from $148.50 per month in 2021 to $170.10 in 2022) for most beneficiaries. To illustrate, the 5.9% Social Security COLA applied to the average 2021 retiree benefit of $1,565 increased that monthly benefit amount by about $92 per month in 2022 (to $1,657);136 that amount was more than sufficient to cover the $21.60 monthly Medicare Part B premium increase. However, for about 1.5% of Part B enrollees (about 900,000), the 2022 Social Security COLA was not sufficient to fully cover the $21.60 Part B premium increase, and they pay monthly premiums of less than $170.10 in 2022.137 A summary of how the hold-harmless provision has been applied in prior ~~A summary of how the hold-harmless provision has been applied in prior~~
years may be found years may be found inin Appendix E.)
Potential Application of the Hold-Harmless Rule in ~~2022~~2023
The extent to which the hold-harmless rule may apply in The extent to which the hold-harmless rule may apply in ~~2022~~2023 depends on a number of factors depends on a number of factors,
including expectations of growth in per capita Part B costs in including expectations of growth in per capita Part B costs in ~~2022~~2023, the extent to which , the extent to which
contingency reserves in the SMI trust fund may need to be contingency reserves in the SMI trust fund may need to be ~~replenished,134~~adjusted,138 and the amount of the and the amount of the
~~2022~~2023 Social Security COLA. In their Social Security COLA. In their ~~2020~~2021 report (which report (which ~~does~~did not reflect the potential not reflect the potential ~~effects~~costs of of
~~the COVID-19 public health emergency),135~~the new Alzheimer’s drug Aduhelm),139 the Medicare trustees projected that the Medicare trustees projected that ~~2022~~2023 Part B Part B
premiums would be about $premiums would be about $~~157.70~~169.90 per month, per month, ~~an increase of $9.20 from the 2021~~which is slightly less than the 2022 premium premium
amount amount ($170.10). Should the 2023 premium be lower than that in 2022, then it would be expected that the hold harmless provision would not be broadly applicable in 2023. 135 See CRS Report RS22195, Social Security Disability Insurance (SSDI) and Medicare: The 24-Month Waiting Period for SSDI Beneficiaries Under Age 65. 136 SSA, Fact Sheet, “2022 Social Security Changes,” at https://www.ssa.gov/news/press/factsheets/colafacts2022.pdf. 137 Figures provided to CRS by CMS, April 2022. 138 See “Contingency Margin.” 139 See CRS Report R46219, Overview of U.S. Domestic Response to Coronavirus Disease 2019 (COVID-19). Congressional Research Service 29 link to page 42 link to page 35 link to page 30 link to page 50 Medicare Part B: Enrollment and Premiums Part B Premiums over Time Part B premium changes over time generally~~($148.50). Under this projection, in the event of no or a very smal 2022 Social Security~~
~~COLA, it is possible that a greater portion of Medicare Part B enrollees could be held harmless in~~
~~2022 than in 2021. Under such circumstance, similar to years such as 2010 and 2011 when the~~
~~hold-harmless provision was more broadly applicable, the approximately 30% of Part B enrollees~~
~~not protected by the hold-harmless provision could pay higher premiums than they would have~~
~~had the hold-harmless provision not been in effect.~~
~~Part B Premiums over Time~~
~~Part B premium changes over time general y~~ reflect the growth in total Part B expenditures, reflect the growth in total Part B expenditures,
although the exact relationship between Part B expenditures covered by the Part B premium has although the exact relationship between Part B expenditures covered by the Part B premium has
been changed by statute at various points. (been changed by statute at various points. (SeeSee Appendix A.)) The standard monthly Part B The standard monthly Part B
premium has risen from $3.00 in 1966 to $premium has risen from $3.00 in 1966 to $~~148.50 in 2021~~170.10 in 2022. (Se. (See Figure 1.)) For comparison, For comparison,
during a similar time period, average annual Part B benefit costs per beneficiary have increased during a similar time period, average annual Part B benefit costs per beneficiary have increased

~~132 Figures provided to CRS by CMS, May 2021.~~
~~133 T he average monthly Social Security payment for retirees in December 2020 prior to the application of the 2021~~
~~COLA was $1,544. At this payment level, a 1.3% COLA resulted in an increase of $20 per month, which more than~~
~~covered the $3.90 Part B premium increase. SSA, Social Security Basic Facts, as of December 2020, at~~
~~https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf.~~
~~134 See “Contingency Margin.”~~
~~135 See CRS Report R46219, Overview of U.S. Domestic Response to Coronavirus Disease 2019 (COVID-19).~~
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~~from about $101.00 in 1970 (about $8.42 per month) to a projected $7,245~~from about $101.00 in 1970 (about $8.42 per month) to a projected $7,502 per beneficiary (about per beneficiary (about
~~$603.75~~$625 per month) in per month) in ~~2021.136~~2022.140
Prior to 2000, the Part B premium Prior to 2000, the Part B premium twice decreased from year to yeardecreased from year to year ~~twice~~. The first instance was from . The first instance was from
1989 ($31.90) to 1990 ($28.60) as a result of the repeal of the Medicare Catastrophic Coverage 1989 ($31.90) to 1990 ($28.60) as a result of the repeal of the Medicare Catastrophic Coverage
Act of 1988 (P.L. 100-360). The second was from 1995 ($46.10) to 1996 ($42.50) as a result of Act of 1988 (P.L. 100-360). The second was from 1995 ($46.10) to 1996 ($42.50) as a result of
the transition from a premium as determined by a fixed dollar amount under the Omnibus the transition from a premium as determined by a fixed dollar amount under the Omnibus
Reconciliation Act of 1990 (P.L. 101-508) to 25% of costs as directed under the Omnibus Budget Reconciliation Act of 1990 (P.L. 101-508) to 25% of costs as directed under the Omnibus Budget
Reconciliation Act of 1993 (P.L. 103-66).Reconciliation Act of 1993 (P.L. 103-66).
Because of the absence of a Social Security COLA in 2010 and 2011, most beneficiaries were Because of the absence of a Social Security COLA in 2010 and 2011, most beneficiaries were
held harmless and paid the 2009 premium of $96.40 per month during those years. The standard held harmless and paid the 2009 premium of $96.40 per month during those years. The standard
2010 and 2011 premiums, paid by those who were not held harmless, were thus higher than they 2010 and 2011 premiums, paid by those who were not held harmless, were thus higher than they
would have been had the hold-harmless provision not been in effect. (See prior section would have been had the hold-harmless provision not been in effect. (See prior section
“Protection of Social Security Benefits from Increases in Medicare Part B Premiums” ” for for
additional detail.) Similarly,additional detail.) Similarly, due to no or low Social Security COLAs in 2016 and 2017, most Part due to no or low Social Security COLAs in 2016 and 2017, most Part
B enrollees were protected by the hold-harmless provision and paid lower premiums in those B enrollees were protected by the hold-harmless provision and paid lower premiums in those
years. years.
Since 2000, the standard Medicare Part B premium has more than tripled, from $45.50 in 2000 to Since 2000, the standard Medicare Part B premium has more than tripled, from $45.50 in 2000 to
the current premium of $the current premium of $~~148.50 in 2021~~170.10 in 2022. This growth has been due to a number of factors that . This growth has been due to a number of factors that
have increased per capita Part B expenditures during that time, including the rising prices of have increased per capita Part B expenditures during that time, including the rising prices of
health care services and equipment, new technologies, and increased utilization of Medicare Part health care services and equipment, new technologies, and increased utilization of Medicare Part
B services.B services.~~137 While Part B expenditure growth has slowed in recent years, the~~141 The Medicare trustees Medicare trustees
~~project faster benefit spending growth from 2020 to 2025 (an 8.2% Part B average annual growth~~
~~rate compared with a 6.9~~project a slightly slower Part B average annual growth rate of 7.2% from 2021 to 2025 compared to the 8.5% growth rate over the prior five years% growth rate over the prior five years~~).138~~
.142 The Medicare trustees estimate that The Medicare trustees estimate that ~~2022~~2023 premiums premiums ~~wil increase to~~will be about $ about $~~157.70~~169.90 per month, per month,
and that premiums and that premiums ~~wil~~ will increase thereafter at an average rate of about 5.increase thereafter at an average rate of about 5.85% per year through % per year through
~~2029.139~~2030.143 (For estimates of premiums in future years through (For estimates of premiums in future years through ~~2029~~2030, se, see Appendix C.).)

~~136 2020 Medicare T rustees Report, T able III.C5. For~~ 140 2021 Medicare Trustees Report, Table III.C5. For an explanation of Part B cost projection methodology including data on recent growth in specific Part B services, see the data on recent growth in specific Part B services, see the ~~2020~~
~~Medicare T rustees~~2021 Medicare Trustees Report, pp. Report, pp. ~~125-136.~~
~~137 2020 Medicare T rustees Report, pp. 125-136.~~
~~138 2020 Medicare T rustees Report, p. 7 and T able III.C5 on p. 87. T hese p rojections do not incorporate assumptions~~
~~about the potential effects of the COVID-19 public health emergency. At this time, it is unclear what effect the~~
~~pandemic will have on future Medicare Part B spending and on 202 2 premiums.~~
~~139 CRS~~ 131-143. 141 2021 Medicare Trustees Report, pp. 131-143. 142 2021 Medicare Trustees Report, p. 32. 143 CRS calculation of compound average growth rate basedcalculation of compound average growth rate based on premium projections in on premium projections in ~~T able~~Table V.E2 of the V.E2 of the ~~2020~~2021
Medicare Medicare ~~T rustees~~Trustees Report. Report.
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Figure 1. Monthly Medicare Part B Premiums
(1966- (1966-~~2029~~2030) )

Source: CRS figure, based on data fromCRS figure, based on data from the the ~~2020~~2021 Annual Report of the Boards of Trustees of the Federal Hospital
Insurance and Federal Supplementary Medical Insurance Trust Funds, , ~~April 22, 2020~~August 31, 2021, Table V.E2 and CMS, “Medicare , Table V.E2 and CMS, “Medicare
Program:Program: Medicare Part B Monthly Actuarial Rates, PremiumMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, Rate, and Annual Deductible Beginning January 1,
~~2021,” 85~~2022,” 86 Federal Register ~~71904~~64205, November , November ~~12, 2020~~17, 2021. .
Note: PremiumsPremiums through through ~~2021~~2022 are actual; premiums are actual; premiums from from ~~2022 to 2029~~2023 to 2030 are estimates. ~~are estimates. The projections do not~~
~~reflect the potential impact of the COVID-19 pandemic or of related legislation enacted subsequent to the~~
~~issuance of the 2020 Medicare Trustees report.~~
Current Issues
Premium Amount and Annual Increases
The Medicare trustees estimate that Medicare Part B premiums The Medicare trustees estimate that Medicare Part B premiums ~~wil~~ will increase from $increase from $~~148.50~~170.10 per per
month in month in ~~2021~~2022 to about $ to about $~~234.10 in 2029.140 (Se~~e248.60 in 2030. (See Appendix C.)) Rising Medicare premiums could Rising Medicare premiums could
have a large effect on Social Security beneficiaries, particularly on those who rely on Social have a large effect on Social Security beneficiaries, particularly on those who rely on Social
Security as their primary source of income.Security as their primary source of income.~~141 For example, in 2017, Social Security benefits~~
~~represented about 33% of the income of Americans aged 65 and older. About 50% of married~~
~~couples and 70% of unmarried persons received more than half of their income from Social~~
~~Security, and 21% of married couples and 45% of unmarried persons received more than 90% of~~

~~140 T he projections do not reflect the potential effects of the COVID-19 public health emergency. At this time, it is~~
~~unclear what effect the pandemic will have on future Medicare Part B spending and premiums.~~
~~141 Other sources of income may include earnings from employment, employer -sponsored pension benefits, and~~
~~investment earnings. In addition, retirees may draw down on their accumulated assets to supp lement their income.~~
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~~their income from Social Security.142 Some of these beneficiaries may see a decline in their~~
~~standard of living as their Medicare premiums rise.~~
~~Once a person receives Social Security, his or her benefit is indexed to inflation and thereafter~~
~~grows with annual Social Security COLAs.143~~144 Some of these beneficiaries may see a decline in their standard of living as their Medicare premiums rise. 144 SSA estimates that Social Security benefits represent about 30% of the income of Americans aged 65 and older. Other sources of income may include earnings from employment, employer-sponsored pension benefits, and investment earnings. In addition, retirees may draw down on their accumulated assets to supplement their income. SSA, “Social Security Basic Facts,” as of June 2021, at https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf. This information is from research released in 2021 using 2015 data. See Dushi, Irena and Trenkamp, Brad, SSA, “Improving the Measurement of Retirement Income of the Aged Population,” at https://www.ssa.gov/policy/docs/workingpapers/wp116.html for more information. Congressional Research Service 31 link to page 47 link to page 50 link to page 51 Medicare Part B: Enrollment and Premiums Once a person receives Social Security, his or her benefit is indexed to inflation and thereafter grows with annual Social Security COLAs.145 However, Medicare premiums are based on the per However, Medicare premiums are based on the per
capita cost growth of Part B benefits, which reflects the growth in the cost of medical care and in capita cost growth of Part B benefits, which reflects the growth in the cost of medical care and in
the utilizationthe utilization and intensity of services used by beneficiaries, factors that have and intensity of services used by beneficiaries, factors that have ~~historical y~~historically grown grown
faster than CPI-W. faster than CPI-W. ~~Additional y~~Additionally, as there has been a continuing shift from providing care in , as there has been a continuing shift from providing care in
inpatient (Part A) to outpatient settings (Part B), a greater portion of Medicare spending is inpatient (Part A) to outpatient settings (Part B), a greater portion of Medicare spending is
expected to be covered by beneficiary premiums.expected to be covered by beneficiary premiums.~~144~~146 This means that, over time, Medicare This means that, over time, Medicare
premiums are expected to represent a growing proportion of most beneficiaries’ Social Security premiums are expected to represent a growing proportion of most beneficiaries’ Social Security
income.income.~~145~~147 Since 2000, Social Security’s annual COLA has resulted in a cumulative benefit Since 2000, Social Security’s annual COLA has resulted in a cumulative benefit
increase of about increase of about ~~55%,146~~64%,148 significantly less than the Part B premium growth of significantly less than the Part B premium growth of ~~over 226~~almost 274%. The %. The
Medicare trustees Medicare trustees ~~estimate~~estimated that average Part B plus Part D premiums that average Part B plus Part D premiums ~~wil~~ will represent close to 12% represent close to 12%
of the average Social Security benefit in of the average Social Security benefit in ~~2020 and wil~~ 2021 and would increase to an estimated 19% in increase to an estimated 19% in ~~2094.147~~
~~(Se~~e2095.149 (See Appendix B aand Appendix C for historical, current, and projected Part B premiums.)for historical, current, and projected Part B premiums.)
~~Additional y,~~ Additionally, while the hold-harmless provision provides protection against increases in the Part while the hold-harmless provision provides protection against increases in the Part
B premium, the rule does not apply to Part D premiums or to late-enrollment penalties. Therefore, B premium, the rule does not apply to Part D premiums or to late-enrollment penalties. Therefore,
even in a year with a 0% or a very low Social Security COLA, beneficiaries even in a year with a 0% or a very low Social Security COLA, beneficiaries protected by the hold harmless rule may still ~~may stil~~ see a see a
decline in benefits as a result of increases in Part D premiums and/or any applicable late-decline in benefits as a result of increases in Part D premiums and/or any applicable late-
enrollment penalties. enrollment penalties.
Impact of the Hold-Harmless Provision on Those Not Held
Harmless
The law does not specify how Medicare Part B financing (premiums and general revenues) The law does not specify how Medicare Part B financing (premiums and general revenues)
should be established in years in which the hold-harmless provision applies to a large number of should be established in years in which the hold-harmless provision applies to a large number of
Medicare beneficiaries. Under current law, the only way to generate enough premium revenue to Medicare beneficiaries. Under current law, the only way to generate enough premium revenue to
cover 25% of Part B costs is to have those not held harmless shoulder the entire beneficiary share cover 25% of Part B costs is to have those not held harmless shoulder the entire beneficiary share
of any increase in premiums.of any increase in premiums.~~148~~150 Absent legislation, such as BBA Absent legislation, such as BBA 15 15 (see Appendix D), the premiums of those not , the premiums of those not
held harmless can therefore be significantly greater than if there were no held harmless can therefore be significantly greater than if there were no hold-harmless provision. As the Medicare trustees pointed out in their 2010 annual report, “(t)his approach to preventing exhaustion of the Part B trust fund account is the only one available under current law,” despite the “serious equity issues” that this method raises.151 145 The COLA increases the benefits~~hold-harmless provision.~~

~~142 SSA, “Social Security Basic Facts,” as of December 2020, at https://www.ssa.gov/news/press/factsheets/basicfact-~~
~~alt.pdf.~~
~~143 T he COLA increases the benefit s~~ paid to paid to current beneficiaries. In contrast, average Social Security beneficiaries. In contrast, average Social Security benefits (those benefits (those
paid to new and current beneficiaries) have risen at a faster rate than the annual COLA, becausepaid to new and current beneficiaries) have risen at a faster rate than the annual COLA, because the formula for the formula for
calculating initial Socialcalculating initial Social Security benefits is linked toSecurity benefits is linked to wage growth, whereas the COLA is growth, whereas the COLA is ~~based~~ based on on price growth. growth.
Generally, wagesGenerally, wages rise faster than prices. rise faster than prices.
~~144~~ 146 In 2000, the ratio of Part A expenditures to Part B expenditures was In 2000, the ratio of Part A expenditures to Part B expenditures was 59:41. 59:41. ~~T his~~This ratio decreased to 50:50 in 2014 and ratio decreased to 50:50 in 2014 and
is expected to drop to 42:58 in is expected to drop to 42:58 in ~~2029. T his~~2030. This means that over time, the proportion of Medicare expenditures covered under means that over time, the proportion of Medicare expenditures covered under
Part B isPart B is expected to increase. While providing more services on an outpatient basis may be more costexpected to increase. While providing more services on an outpatient basis may be more cost -effective for the -effective for the
program as a whole, it also means that beneficiaries willprogram as a whole, it also means that beneficiaries will be expected to bear a larger portion of program costs over be expected to bear a larger portion of program costs over
time. Seetime. See ~~CRS~~ CRS Report R43122, Report R43122, Medicare Financial Status: In Brief. .
~~145 T he~~147 The hold-harmless provision caps the annual Part B premium increase (but hold-harmless provision caps the annual Part B premium increase (but not the Part D increase) at the dollar not the Part D increase) at the dollar
amount of a beneficiary’s COLA. amount of a beneficiary’s COLA.
~~146~~148 CRS CRS calculations basedcalculations based on SSA,on SSA, Office of the Chief Actuary, “CostOffice of the Chief Actuary, “Cost -of-Living Adjustments,” at -of-Living Adjustments,” at
https://www.ssa.gov/oact/COLA/colaseries.html. https://www.ssa.gov/oact/COLA/colaseries.html.
~~147~~149 Similarly, average Medicare cost sharing Similarly, average Medicare cost sharing is was estimated to be about estimated to be about 1211% of the Social Security% of the Social Security benefit in benefit in ~~2020~~2021, and it , and it
is expected to increase to approximately is expected to increase to approximately 1821% in % in ~~2094. 2020~~2095. 2021 Medicare Medicare ~~T rustees~~Trustees Report, Report, ~~p. 36.~~
~~148 T he law does~~ pp. 38-39. 150 The law does not specify that this method be used,not specify that this method be used, but it also doesbut it also does not prohibit it. 151 Boards of Trustees, Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds, 2010~~not prohibit it.~~
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~~As the Medicare trustees pointed out in their 2010 annual report, “(t)his approach to preventing~~
~~exhaustion of the Part B trust fund account is the only one available under current law,” despite~~
~~the “serious equity issues” that this method raises.149~~
In years in which there has been both a 0% or a very low Social Security COLA and a Medicare In years in which there has been both a 0% or a very low Social Security COLA and a Medicare
premium increase, concerns have been raised about the potential financial impact of the premium premium increase, concerns have been raised about the potential financial impact of the premium
increases on those not held harmless as increases on those not held harmless as ~~wel~~ well as on the state Medicaid agencies that pay Part B as on the state Medicaid agencies that pay Part B
premiums on behalf of low-income beneficiaries. For example, individuals in retirement systems premiums on behalf of low-income beneficiaries. For example, individuals in retirement systems
other than Social Security or RRB may also have not received a COLA but could face other than Social Security or RRB may also have not received a COLA but could face
significantly higher Medicare premiums than those who qualified for protection under the hold-significantly higher Medicare premiums than those who qualified for protection under the hold-
harmless provision.harmless provision.~~150~~152 Some have proposed changes to the hold-harmless provision to avoid the Some have proposed changes to the hold-harmless provision to avoid the
disproportionate impact of premium increases on those not held harmless, such as holding disproportionate impact of premium increases on those not held harmless, such as holding al all Part Part
B enrollees harmless in years in which there is no Social Security B enrollees harmless in years in which there is no Social Security ~~COLA151 or al owing~~COLA153 or allowing Social Social
Security checks to decline as a result of Medicare premium increases in some years.Security checks to decline as a result of Medicare premium increases in some years.~~152~~154 Others Others
have proposed linking the Social Security COLA to a measure of inflation that is based on have proposed linking the Social Security COLA to a measure of inflation that is based on
purchasing patterns of the elderly, such as the BLS’s Experimental Consumer Price Index for purchasing patterns of the elderly, such as the BLS’s Experimental Consumer Price Index for
Americans Aged 62 and Older (CPI-E)Americans Aged 62 and Older (CPI-E)~~153~~155 or requiring a minimum annual Social Security or requiring a minimum annual Social Security
COLA.COLA.~~154~~156
Proposals to Modify the Late-Enrollment Penalty
~~Periodical y~~Due to concerns about potential adverse impacts, proposals have , proposals have periodically been offered to modify or eliminate the Part B premium penalty been offered to modify or eliminate the Part B premium penalty
either for either for al all enrollees or alternativelyenrollees or alternatively ~~for a selected population group.~~ for selected population groups. As an increasing number As an increasing number
of new Medicare-eligible beneficiaries must actively sign up for Medicare because they are not of new Medicare-eligible beneficiaries must actively sign up for Medicare because they are not
yet receiving Social Security benefits (e.g., their full retirement yet receiving Social Security benefits (e.g., their full retirement ~~Social Security age exceeds the~~
~~Medicare age of eligibility), there is concern that more people could become subject to late-~~

~~149 Boards of T rustees,~~ ~~Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds, 2010~~
Annual Report of the Boards of Trustees of the Federal ~~Hosp ital~~Hospital Insurance and Federal ~~Supplem ental~~Supplemental Medical
Insurance Trust Funds, August, August 5, 2010, pp. 97-98, at https://www.cms.gov/Research-Statistics-Data-and-Systems/5, 2010, pp. 97-98, at https://www.cms.gov/Research-Statistics-Data-and-Systems/
Statistics-Statistics-~~T rends~~Trends-and-Reports/ReportsTrustFunds/downloads/tr2010.pdf. -and-Reports/ReportsTrustFunds/downloads/tr2010.pdf.
~~150~~ 152 For example, the annual increase in the CSRS For example, the annual increase in the CSRS benefits is tied to the same inflation measure as Socialbenefits is tied to the same inflation measure as Social Security; Security;
therefore, those under this system also received a therefore, those under this system also received a ~~1.3~~5.9% COLA% COLA ~~in 2021.~~
~~151~~ in 2022. 153 For example, S. For example, S. 2148, the Protecting Medicare Beneficiaries Act of 2015, and H.R.2148, the Protecting Medicare Beneficiaries Act of 2015, and H.R. 3696, the Medicare Premium 3696, the Medicare Premium
Fairness Act, both introduced on October 7, 2015, wouldFairness Act, both introduced on October 7, 2015, would have kept the 2016 Part B premiums at the 2015 level for all have kept the 2016 Part B premiums at the 2015 level for all
beneficiaries, includingbeneficiaries, including those with high incomes. Late-enrollment surcharges also wouldthose with high incomes. Late-enrollment surcharges also would have been basedhave been based on the 2015 on the 2015
standard premium. standard premium. ~~T he~~The loss of income from holding premiums flat in 2016 would loss of income from holding premiums flat in 2016 would have been offset by increased have been offset by increased
general revenue contributions. Note that these bills wouldgeneral revenue contributions. Note that these bills would ~~have affected only~~ have only affected premium determinations for premium determinations for ~~201 6~~2016 and and
wouldwould not have made permanent changes to the hold-harmless provision. not have made permanent changes to the hold-harmless provision.
~~152~~ 154 Charles Blahous, “How Social Charles Blahous, “How Social Security’sSecurity’s COLA Politics Lead to Bad Policy,” Economic Policies for the COLA Politics Lead to Bad Policy,” Economic Policies for the ~~21 st~~21st
Century at the Manhattan Institute, November 22, 2015, at https://economics21.org/html/how-social-Century at the Manhattan Institute, November 22, 2015, at https://economics21.org/html/how-social-
security%E2%80%99s-cola-politics-lead-bad-policy-1522.html. security%E2%80%99s-cola-politics-lead-bad-policy-1522.html.
~~153 T he~~155 The CPI-E grows faster than the CPI-W, on average, because a larger portion of spending by the elderly goes toward CPI-E grows faster than the CPI-W, on average, because a larger portion of spending by the elderly goes toward
health care expenditures and other items whose prices tend to rise more rapidly. As a result, switchinghealth care expenditures and other items whose prices tend to rise more rapidly. As a result, switching to such a to such a
measure ismeasure is projected to result in larger COLAsprojected to result in larger COLAs and higher Socialand higher Social Security benefits. SeeSecurity benefits. See ~~CRS~~ CRS Report R43363, Report R43363,
Alternative Inflation Measures for the Social Security Cost-of-Living ~~Adjustm ent~~Adjustment (COLA). For example, introduced in . For example, introduced in
the the ~~116th~~117th Congress, Congress, ~~the CPI for Seniors Act of 2019 (H.R. 2787), the~~H.R. 5737, the Social Security for Future Generations Act of 2021; H.R. 5723/S. 3071, Social Social Security 2100: A Sacred Trust; S. 3070, Safeguarding American Families and Expanding Social Security Act of 2021; H.R. 5215, Social Security Stabilization and Enhancement Act; H.R. 4921, Strengthening Social Security Act of 2021; and, H.R. 4315, Fair COLA for Seniors Act of 2021 would require ~~Security 2100 Act (H.R. 860 and S. 269),~~
~~and the Social Security Expansion Act (S. 478) would have required~~ the use of the CPI-E in determining the Social the use of the CPI-E in determining the Social
Security COLA. Security COLA.
~~154~~156 For example, in the 117th Congress, H.R. 2266, the Certainty for Older Living Americans Act of 2021 would provide for a minimum annual cost-of-living increase for Social Security benefits. Additionally, in the ~~For example, in the~~ 116th Congress, S. 1923, the Guaranteed 3 Percent COLA for Seniors Act of 2019, would have 116th Congress, S. 1923, the Guaranteed 3 Percent COLA for Seniors Act of 2019, would have
~~required~~ required a minimum 3% Sociala minimum 3% Social ~~Security~~ Security COLA each yearCOLA each year~~. Also, in the 116 th Congress~~, and, H.R. 46, the Social Security , H.R. 46, the Social Security
Safety Dividend Act of 2019, wouldSafety Dividend Act of 2019, would have guaranteed a $250 increase in benefits for any year that no COLA is payable.have guaranteed a $250 increase in benefits for any year that no COLA is payable.
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Social Security age exceeds the Medicare age of eligibility), there is concern that more people could become subject to late-enrollment penalties. For example, the Medicare Rights Center reported a large number of enrollment penalties. For example, the Medicare Rights Center reported a large number of ~~cal s~~calls to to
its hotline related to transitioning to Medicare. Their report notes that “(m)any individuals who its hotline related to transitioning to Medicare. Their report notes that “(m)any individuals who
~~cal~~ call Medicare Rights are confused by Medicare enrollment rules, and Medicare Rights are confused by Medicare enrollment rules, and ~~specifical y~~specifically by decision- by decision-
making related to taking or declining Part B” and that “Medicare-eligiblemaking related to taking or declining Part B” and that “Medicare-eligible people who do not people who do not
understand Part B enrollment rules and fail to enroll in Medicare when they first became eligible understand Part B enrollment rules and fail to enroll in Medicare when they first became eligible
may face late-enrollment penalties, gaps in coverage, and disruptions to access to needed care.”may face late-enrollment penalties, gaps in coverage, and disruptions to access to needed care.”~~155~~
~~Some~~157 Additionally, as the life expectancy of Medicare beneficiaries has increased since the late-enrollment penalties were first created in 1965, individuals may now incur such penalties for a longer average duration than originally anticipated. There are therefore concerns that the penalties could lead beneficiaries to further delay enrollment. The Medicare Payment Advisory Commission (MedPAC) has also suggested that late-enrollment penalties may not benefit the program financially; due to the highly subsidized nature of Part B, “even younger and healthier beneficiaries are likely to cost the program more than they would contribute in premiums.”158 To address some of these concerns, some proposals have suggested modifying the penalty provision to limit proposals have suggested modifying the penalty provision to limit both the amount and the both the amount and the
duration of the surcharge, as is the case for delayed Part A enrollment, which has a maximum duration of the surcharge, as is the case for delayed Part A enrollment, which has a maximum
10% surcharge and a duration of twice the number of years that enrollment was delayed. (See10% surcharge and a duration of twice the number of years that enrollment was delayed. (See
Appendix EF for information on the Part A premium and late-enrollment penalty.) for information on the Part A premium and late-enrollment penalty.)
Some have also suggested that Medicare Part B have a creditable-coverage exemption, similar to Some have also suggested that Medicare Part B have a creditable-coverage exemption, similar to
that under Part D, that would that under Part D, that would ~~al ow~~allow Medicare beneficiaries with equivalent coverage to postpone Medicare beneficiaries with equivalent coverage to postpone
enrollment in Part B without being subject to a penalty. For example, under the Part D enrollment in Part B without being subject to a penalty. For example, under the Part D
prescription drug benefit, individuals are not subject to a late-enrollment penalty if they have prescription drug benefit, individuals are not subject to a late-enrollment penalty if they have
maintainedmaintained “creditable” prescription drug coverage prior to enrollment—that is, coverage that is “creditable” prescription drug coverage prior to enrollment—that is, coverage that is
expected to pay at least as much as Medicare’s standard prescription drug coverage.expected to pay at least as much as Medicare’s standard prescription drug coverage.~~156~~159 Creditable Creditable
prescription drug coverage includes employer-based prescription drug coverage, qualified State prescription drug coverage includes employer-based prescription drug coverage, qualified State
Pharmaceutical Assistance Programs, and military-related coverage (e.g., Veterans Affairs health Pharmaceutical Assistance Programs, and military-related coverage (e.g., Veterans Affairs health
care system and TRICARE).care system and TRICARE).~~157~~
160 Other suggestions include delaying late-enrollment penalties or initial enrollment periods until beneficiaries begin receiving Social Security benefits or enroll in Part A; granting special enrollment periods to those covered by COBRA or marketplace plans; formally training employers about Medicare coverage and interaction with other insurance; improving education on Medicare, including late-enrollment penalties, for those nearing Medicare-eligibility age; and, 157 Medicare Rights Center, “Medicare Trends ~~Other suggestions include formal y training employers about Medicare coverage and interaction~~
~~with other insurance; improving education on Medicare, including late-enrollment penalties, for~~
~~those nearing Medicare-eligibility age; and expanding equitable relief to include remedies for~~
~~actions based on misinformation provided by entities in addition to an agent of the federal~~
~~government, such as an agent of state or local government, and/or an employer or insurer.~~
~~In recent Congresses, a number of bil s have been introduced that would address some of the~~
~~issues associated with the Part B late-enrollment penalty. For example, in the 117th Congress,~~
~~H.R. 480 would limit the penalty to 15% and twice the period of no enrollment, and would~~
~~exclude periods of COBRA (Consolidated Omnibus Budget Reconciliation Act) coverage, retiree,~~
~~and VA coverage when determining the late enrollment penalty. In the 116th Congress, H.R. 3417,~~
~~H.R. 2477 and S. 1280 would have required Medicare to provide advance notification to those~~
~~approaching Medicare eligibility.158 Also introduced in the 116th Congress, H.R. 2564 and H.R.~~
~~1657 would have established a special Medicare Part B enrollment period for individuals enrolled~~
~~in COBRA continuation coverage who elected not to enroll in Part B during their initial~~
~~enrollment period. In the 115th Congress, H.R. 2342 would have required that employers notify~~

~~155 Medicare Rights Center, “Medicare T rends~~ and Recommendations: An Analysis of 2015 Call Data from the and Recommendations: An Analysis of 2015 Call Data from the
Medicare Rights Center’s National Helpline,” March 2017, at https://www.medicarerights.org/pdf/2015-helpline-Medicare Rights Center’s National Helpline,” March 2017, at https://www.medicarerights.org/pdf/2015-helpline-
trends-report.pdf. (Their April 2019 analysis of 2017 call data may be found attrends-report.pdf. (Their April 2019 analysis of 2017 call data may be found at https://www.medicarerights.org/2017-https://www.medicarerights.org/2017-
medicare-trends-recommendations.) The Medicare Rights Center also issuedmedicare-trends-recommendations.) The Medicare Rights Center also issued a related report entitled “a related report entitled “ A Costly A Costly
Mistake: MissingMistake: Missing Part B Enrollment,” April 2015, at http://www.medicarerights.org/pdf/medicare-snapshot-Part B Enrollment,” April 2015, at http://www.medicarerights.org/pdf/medicare-snapshot-
040915.pdf. 040915.pdf.
~~156 See Medicare publication “Your Guide~~ 158 Medicare Payment Advisory Commission (MedPAC), June 2019, Report to Congress: Medicare and the Health Care Delivery System, Chapter 1. “Beneficiary Enrollment in Medicare: Eligibility Notification, Enrollment Process, and Part B Late-Enrollment Penalties,” p. 12, at https://www.medpac.gov/document/http-www-medpac-gov-docs-default-source-reports-jun19_medpac_reporttocongress_sec-pdf/. 159 See Medicare publication “Your Guide to Medicare Prescription Drug Coverage,” p.20, at to Medicare Prescription Drug Coverage,” p.20, at
https://www.medicare.gov/Pubs/pdf/11109-Your-Guide-to-Medicare-Prescrip-Drug-Cov.pdf. https://www.medicare.gov/Pubs/pdf/11109-Your-Guide-to-Medicare-Prescrip-Drug-Cov.pdf.
~~157~~160 42 CFR 42 CFR §423.56. Employers or unions may also qualify for a federal subsidy§423.56. Employers or unions may also qualify for a federal subsidy to maintain prescription drug coverage to maintain prescription drug coverage
for their retirees.for their retirees. ~~Such subsidies are generally less expensive to the federal government than providing full coverage to~~
~~such enrollees under Part D. 2020 Medicare T rustees Report , T able IV.B9.~~
~~158 T hese bills also would have restructured Medicare enrollment and coverage periods and expanded the eligibility for~~
~~special enrollment periods for those who met exceptional conditions as defined by the Secretary of HHS. T hose~~
~~changes were included in t he Consolidated Appropriations Act, 2021 (P.L. 116-260; Division CC, §102) and will be~~
~~effective in 2023.~~
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~~link to page 21~~ ~~Medicare Part B: Enrollment and Premiums~~

~~employees about the availability~~ Congressional Research Service 34 Medicare Part B: Enrollment and Premiums expanding equitable relief to include remedies for actions based on misinformation provided by entities in addition to an agent of the federal government, such as an agent of state or local government, and/or an employer or insurer.161 In recent Congresses, a number of bills have been introduced that would address some of the issues associated with the Part B late-enrollment penalty. For example, in the 117th Congress, H.R. 480 would limit the penalty to 15% and twice the period of no enrollment, and would exclude periods of COBRA (Consolidated Omnibus Budget Reconciliation Act) coverage, retiree, and VA coverage when determining the late enrollment penalty. Also introduced in the 117th Congress, S. 3675, the Beneficiary Enrollment Notification and Eligibility Simplification 2.0 Act would require the Social Security Administration to provide advance notification to those approaching Medicare eligibility. In the 116th Congress, H.R. 2564 and H.R. 1657 would have established a special Medicare Part B enrollment period for individuals enrolled in COBRA continuation coverage who elected not to enroll in Part B during their initial enrollment period. In the 115th Congress, H.R. 2342 would have required that employers notify employees about the availability of special enrollment periods to obtain marketplace coverage of special enrollment periods to obtain marketplace coverage
and Medicare coverage upon termination or separationand Medicare coverage upon termination or separation~~. Additional y,~~, and H.R. 707 would have, H.R. 707 would have,
among other changes, eliminated late-enrollment penalties for those between the ages of 65 and among other changes, eliminated late-enrollment penalties for those between the ages of 65 and
~~70.~~
70. As introduced in the 112th Congress, in addition to creating a special enrollment period for those As introduced in the 112th Congress, in addition to creating a special enrollment period for those
with COBRAwith COBRA coverage, H.R. 1654 would have created a continuous enrollment period that would coverage, H.R. 1654 would have created a continuous enrollment period that would
have have ~~al owed~~allowed Medicare-eligible Medicare-eligible beneficiaries to sign up for Part B outside of the general beneficiaries to sign up for Part B outside of the general
enrollment period and to receive health coverage the following month. H.R. 1654 would have enrollment period and to receive health coverage the following month. H.R. 1654 would have
also expanded eligibilityalso expanded eligibility for equitable relief to those who based enrollment decisions on incorrect for equitable relief to those who based enrollment decisions on incorrect
information provided by group health plans and plan sponsors, and it would have directed the information provided by group health plans and plan sponsors, and it would have directed the
Government Accountability Office to study problems with Part B enrollment. Government Accountability Office to study problems with Part B enrollment.
Deficit Reduction Proposals
As Medicare currently represents about As Medicare currently represents about 1213% of federal spending,% of federal spending,~~159~~162 many proposals to reduce many proposals to reduce
federal deficits include suggestions to reduce Medicare program spending and/or increase federal deficits include suggestions to reduce Medicare program spending and/or increase
program income. For example, some proposals would increase Medicare premiums as a portion program income. For example, some proposals would increase Medicare premiums as a portion
of total program funding, whereas others would limit the amount of federal contributions. of total program funding, whereas others would limit the amount of federal contributions.
Increasing Medicare Premiums
Certain proposals suggest limiting premium increases to high-income beneficiaries. For example, Certain proposals suggest limiting premium increases to high-income beneficiaries. For example,
the President’s FY2017 budget proposal would have increased the percentage of per capita the President’s FY2017 budget proposal would have increased the percentage of per capita
expenditures paid by high-income enrollees from 35% to 80% of expenditures to a range of expenditures paid by high-income enrollees from 35% to 80% of expenditures to a range of
between 40% and 90%, and it would have increased the number of high-income brackets from between 40% and 90%, and it would have increased the number of high-income brackets from
four to five.four to five.~~160~~163 The proposal also would have continued the freeze on income thresholds until 25% 161 Some of these suggestions would be addressed by CMS’s proposed April 22, 2022 regulations that implement Section 120 of the Consolidated Appropriations Act, 2021 (P.L. 116-260). See CMS, “Implementing Certain Provisions of the Consolidated Appropriations Act, 2021, and Other Revisions to Medicare Enrollment and Eligibility Rules (CMS-4199-P),” fact sheet, April 22, 2022, at https://www.cms.gov/newsroom/fact-sheets/implementing-certain-provisions-consolidated-appropriations-act-2021-and-other-revisions-medicare-1. (For further detail, see “Proposed Special Enrollment Periods for “Exceptional Conditions.”) 162 The federal spending amount is net of beneficiary premiums. CRS calculation based on data from CBO, Additional Information About the Updated Budget and Economic Outlook: 2021 to 2031, July 2021, at https://www.cbo.gov/system/files/2021-07/57263-outlook.pdf. 163 See Department of Health and Human Services, Fiscal Year 2017 Budget in Brief, p. 76, at http://www.hhs.gov/ Congressional Research Service 35 link to page 23 Medicare Part B: Enrollment and Premiums of beneficiaries were subject to the high-income premiums. (Subsequent to that proposal, the BBA 18 added a fifth high-income bracket with premiums set at 85% of per capita expenditures. See “Income-Related Premiums.”) Other proposals suggest increasing premiums paid by all Part B enrollees. For example, a proposal introduced in 2011 by then-Senators Lieberman and Coburn164 suggested raising the standard Part B premium from the current 25% of program costs to 35% over five years.165 Impose a Part B Premium Surcharge for Beneficiaries in Medigap Plans with Near First-Dollar Coverage In 2020, about 39% of beneficiaries enrolled in traditional Medicare bought Medigap policies from private insurance companies that cover some or all of Medicare’s cost sharing.166 Individuals who purchase Medigap must pay a monthly premium, which is set by, and paid to, the insurance company selling ~~The proposal also would have continued the freeze on income thresholds until 25%~~
~~of beneficiaries were subject to the high-income premiums. (Subsequent to that proposal, the~~
~~BBA 18 added a fifth high-income bracket with premiums set at 85% of per capita expenditures.~~
~~See “Income-Related Premiums.”)~~
~~Other proposals suggest increasing premiums paid by al Part B enrollees. For example, a~~
~~proposal introduced in 2011 by then-Senators Lieberman and Coburn161 suggested raising the~~
~~standard Part B premium from the current 25% of program costs to 35% over five years.162~~
~~Impose a Part B Premium Surcharge for Beneficiaries in Medigap Plans with~~
~~Near First-Dollar Coverage~~
~~In 2018, about 34% of beneficiaries enrolled in traditional Medicare bought Medigap policies~~
~~from private insurance companies that cover some or al of Medicare’s cost sharing.163~~

~~159 T he federal spending amount is net of beneficiary premiums. CRS calculation based on data from CBO,~~ ~~Budget and~~
~~Econom ic Outlook: 2021 to 2031, February 2021.~~
~~160 See Department of Health and Human Services, Fiscal Year 2017 Budget in Brief, p. 76, at http://www.hhs.gov/~~
~~sites/default/files/fy2017-budget-in-brief.pdf.~~
~~161 A Bipartisan Plan to Save Medicare and Reduce Debt, June 28, 2011.~~
~~162 For additional information, see CBO, Options for Reducing the Deficit: 2021 to 2030, “Increase Premiums for Parts~~
~~B and D of Medicare,” December 9, 2020, at https://www.cbo.gov/budget-options/56831.~~
~~163 America’s Health Insurance Plans (AHIP), State of Medigap 2020, Trends in Enrollments and Demographics, p. 3,~~
~~July 7, 2020, at https://www.ahip.org/state-of-medigap-trends-in-enrollment-and-demographics/. Also see archived~~
~~CRS Report R42745, Medigap: A Prim er.~~
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~~Medicare Part B: Enrollment and Premiums~~

~~Individuals who purchase Medigap must pay a monthly premium, which is set by, and paid to, the~~
~~insurance company sel ing~~ the policy. There are 10 standardized Medigap plans with varying the policy. There are 10 standardized Medigap plans with varying
levels of coverage. Two of the 10 standardized plans cover Parts A and B deductibles and levels of coverage. Two of the 10 standardized plans cover Parts A and B deductibles and
coinsurance in full (i.e., offer coinsurance in full (i.e., offer first-dollar coverage). In coverage). In ~~2018, 58% of al~~ 2020, 50% of all beneficiaries who beneficiaries who
purchased Medigap insurance were covered by one of these two plans.purchased Medigap insurance were covered by one of these two plans.~~164~~167
Some are concerned that beneficiaries enrolled in Medigap plans with low cost-sharing Some are concerned that beneficiaries enrolled in Medigap plans with low cost-sharing
requirements may have less incentive to consider the cost of health care services and may thus requirements may have less incentive to consider the cost of health care services and may thus
increase costs to the Medicare program. To address this, Section 401 of MACRA prohibits the increase costs to the Medicare program. To address this, Section 401 of MACRA prohibits the
sale of Medigap policies that cover Part B deductibles to newly eligiblesale of Medigap policies that cover Part B deductibles to newly eligible Medicare beneficiaries Medicare beneficiaries
beginning in 2020.beginning in 2020.~~165~~168 Some have also proposed imposing a Part B premium surcharge for Some have also proposed imposing a Part B premium surcharge for
Medicare beneficiaries who purchase certain types of Medigap plans. For example, the Medicare beneficiaries who purchase certain types of Medigap plans. For example, the
President’s FY2016 budget President’s FY2016 budget ~~proposal166~~proposal169 suggested imposing a Part B premium surcharge of suggested imposing a Part B premium surcharge of
approximately 15% of the average Medigap premium (about 30% of the Part B premium) for new approximately 15% of the average Medigap premium (about 30% of the Part B premium) for new
Medicare beneficiaries who enroll in a near first-dollar Medigap plan. Medicare beneficiaries who enroll in a near first-dollar Medigap plan.
Limit Federal Subsidies
~~Final y, other proposals~~Proposals, such as that put forth in the FY2019 House Budget Resolution,, such as that put forth in the FY2019 House Budget Resolution,~~167~~170 would would
place limits on the amount of the federal subsidy for Medicare, and premiums would vary place limits on the amount of the federal subsidy for Medicare, and premiums would vary
~~depending on the Medicare plan in which the beneficiary enrolled. In general, such~~ ~~premium~~
~~support~~ ~~proposals would limit federal spending by changing the current Medicare program from a~~
~~defined-benefit to a defined-contribution system.168 Most such proposals would limit the growth~~
~~in the annual federal premium subsidy. Depending on how such a proposal is designed, and~~
~~should Medicare costs grow more quickly than the limit, beneficiary premiums could increase~~
~~more rapidly than the amount of the premium subsidy.~~
~~Considerations~~
~~Some of the issues that would need to be addressed when evaluating these types of deficit~~
~~reduction proposals include (1) the ability of Medicare beneficiaries to absorb increased costs~~
~~given their current levels of income and assets, as wel as their other out-of-pocket expenditures~~
~~(both health and non-health related); (2) the wil ingness of high-income beneficiaries to continue~~
~~participating in Medicare Part B should their premiums be increased; and (3) the capacity of the~~
~~Medicaid program to continue providing premium assistance to low -income beneficiaries should~~
~~premiums increase.~~

~~164~~ ~~America’s Health Insurance Plans (AHIP), State of Medigap 2020, Trends in Enrollments~~depending on the sites/default/files/fy2017-budget-in-brief.pdf. 164 A Bipartisan Plan to Save Medicare and Reduce Debt, June 28, 2011. 165 For additional information, see CBO, Options for Reducing the Deficit: 2021 to 2030, “Increase Premiums for Parts B and D of Medicare,” December 9, 2020, at https://www.cbo.gov/budget-options/56831. 166 America’s Health Insurance Plans (AHIP), The State of Medicare Supplement Coverage: Trends in Enrollment and Demographics, March 2022, p. 2, at https://ahiporg-production.s3.amazonaws.com/documents/202202-AHIP_MedicareSuppCvg-02_v03.pdf . Also see archived CRS Report R42745, Medigap: A Primer. 167 AHIP, The State of Medicare Supplement Coverage: Trends in Enrollment and Demographics, March 2022, p. 8, Medigap ~~, July~~
~~7, 2020, p. 8, Medigap~~ Plans C and F. Plans C and F.
~~165~~168 For additional information, including the potential budgetary impact of further limiting Medigap coverage of For additional information, including the potential budgetary impact of further limiting Medigap coverage of
beneficiary outbeneficiary out -of-pocket costs, see CBO, -of-pocket costs, see CBO, Options for Reducing the Deficit: 2021 to 2030 , “, “ Change the CostChange the Cost -Sharing -Sharing
RulesRules for Medicarefor Medicare and Restrict Medigap Insurance,” December 9, 2020and Restrict Medigap Insurance,” December 9, 2020 , at https://www.cbo.gov/budget-options/, at https://www.cbo.gov/budget-options/
56830. 56830.
~~166 See CRS~~ 169 See CRS Report R43934, Report R43934, President’s FY2016 Budget: Centers for Medicare & Medicaid Services (CMS)
Legislative Proposals. Subsequent. Subsequent Presidents’ budgetsPresidents’ budgets ~~did~~ did not contain this proposal. not contain this proposal.
~~167 T he~~170 The proposed FY2019 House Budget proposed FY2019 House Budget Resolution may beResolution may be found at https://www.congress.gov/bill/115th-congress/found at https://www.congress.gov/bill/115th-congress/
house-concurrenthouse-concurrent -resolution/128. The resolution was passed-resolution/128. The resolution was passed by the House Budgetby the House Budget Committee on June 21Committee on June 21 , 2018. See , 2018. See
CRSCRS Report R43479, Report R43479, Overview of Health Care Changes in the FY2015 House Budget, for discussion, for discussion of a similar Congressional Research Service 36 Medicare Part B: Enrollment and Premiums Medicare plan in which the beneficiary enrolled. In general, such premium support proposals would limit federal spending by changing the current Medicare program from a defined-benefit to a defined-contribution system.171 Most such proposals would limit the growth in the annual federal premium subsidy. Depending on how such a proposal were designed, and should Medicare costs grow more quickly than the limit, beneficiary premiums could increase more rapidly than the amount of the premium subsidy. Considerations Some of the issues that would need to be addressed when evaluating these types of deficit reduction proposals include (1) the ability of Medicare beneficiaries to absorb increased costs given their current levels of income and assets, as well as their other out-of-pocket expenditures (both health and non-health related); (2) the willingness of high-income beneficiaries to continue participating in Medicare Part B should their premiums be increased; and (3) the capacity of the Medicaid program to continue providing premium assistance to low-income beneficiaries should premiums increase. ~~of a similar~~
proposal. proposal.
~~168~~ 171 Most premium support models combine Parts A and B benefits; the premium subsidy Most premium support models combine Parts A and B benefits; the premium subsidy and beneficiary premiums and beneficiary premiums
wouldwould apply to both of these parts of Medicare. apply to both of these parts of Medicare.
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Appendix A. History of the Part B Premium
Statutory Policy and Legislative Authority
The basis for determining the Part B premium amount has changed several times since the The basis for determining the Part B premium amount has changed several times since the
inception of the Medicare program, reflecting different legislative views of what share inception of the Medicare program, reflecting different legislative views of what share
beneficiaries should bear as expenditures have increased. When the Medicare program first went beneficiaries should bear as expenditures have increased. When the Medicare program first went
into effect in July 1966, the Part B monthly premium was set at a level to cover 50% of Part B into effect in July 1966, the Part B monthly premium was set at a level to cover 50% of Part B
program costs. Legislation enacted in 1972 limitedprogram costs. Legislation enacted in 1972 limited the annual percentage increase in the premium the annual percentage increase in the premium
to the same percentage by which Social Security benefits were adjusted for changes in the cost-to the same percentage by which Social Security benefits were adjusted for changes in the cost-
of-living adjustments (i.e., COLAs). Under this formula, revenues from premiums soon dropped of-living adjustments (i.e., COLAs). Under this formula, revenues from premiums soon dropped
from 50% to below 25% of program costs because Part B program costs increased much faster from 50% to below 25% of program costs because Part B program costs increased much faster
than inflation as measured by the Consumer Price Index on which the Social Security COLA is than inflation as measured by the Consumer Price Index on which the Social Security COLA is
based (sebased (see Table A-1).
From the early 1980s, Congress regularly voted to set Part B premiums at a level to cover 25% of From the early 1980s, Congress regularly voted to set Part B premiums at a level to cover 25% of
program costs, in effect overriding the COLA limitation. The 25% provisions first became program costs, in effect overriding the COLA limitation. The 25% provisions first became
effective January 1, 1984, with general revenues covering the remaining 75% of Part B program effective January 1, 1984, with general revenues covering the remaining 75% of Part B program
costs. Premiums increased in 1989 as a result of the Medicare Catastrophic Coverage Act of 1988 costs. Premiums increased in 1989 as a result of the Medicare Catastrophic Coverage Act of 1988
(P.L. 100-360), which added a catastrophic coverage premium to the Part B premium. The act (P.L. 100-360), which added a catastrophic coverage premium to the Part B premium. The act
was repealed in November 1989, and the Part B premium for 1990 was repealed in November 1989, and the Part B premium for 1990 ~~fel~~ fell as a result. as a result.
Congress returned to the general approach of having premiums cover 25% of program costs in the Congress returned to the general approach of having premiums cover 25% of program costs in the
Omnibus Budget Reconciliation Act of 1990 (OBRA 90; P.L. 101-508). However, OBRA 90 set Omnibus Budget Reconciliation Act of 1990 (OBRA 90; P.L. 101-508). However, OBRA 90 set
specific dollar figures, rather than a percentage, in law for Part B premiums for the years 1991-specific dollar figures, rather than a percentage, in law for Part B premiums for the years 1991-
1995. These dollar figures reflected Congressional Budget Office estimates of what 25% of 1995. These dollar figures reflected Congressional Budget Office estimates of what 25% of
program costs would be over the five-year period. However, program costs grew more slowly program costs would be over the five-year period. However, program costs grew more slowly
than anticipated, in part due to subsequent legislative changes. As a result, the 1995 premium of than anticipated, in part due to subsequent legislative changes. As a result, the 1995 premium of
$46.10 $46.10 ~~actual y~~actually represented 31.5% of Medicare Part B program costs. represented 31.5% of Medicare Part B program costs.
The Omnibus Budget Reconciliation Act of 1993 (OBRA 93; P.L. 103-66) extended the policy of The Omnibus Budget Reconciliation Act of 1993 (OBRA 93; P.L. 103-66) extended the policy of
setting the Part B premium at a level to cover 25% of program costs for the years 1996-1998. As setting the Part B premium at a level to cover 25% of program costs for the years 1996-1998. As
was the case prior to 1991, a percentage rather than a fixed dollar figure was used, which meant was the case prior to 1991, a percentage rather than a fixed dollar figure was used, which meant
that the 1996 premium ($42.50) and the 1997 premium ($43.80) were lower than the 1995 that the 1996 premium ($42.50) and the 1997 premium ($43.80) were lower than the 1995
premium ($46.10). The Balanced Budget Act of 1997 (BBApremium ($46.10). The Balanced Budget Act of 1997 (BBA 97; P.L. 105-33) permanently set the 97; P.L. 105-33) permanently set the
premium at 25% of program costs so that, premium at 25% of program costs so that, ~~general y~~generally speaking, premiums rise or speaking, premiums rise or ~~fal~~ fall with Part B with Part B
program costs.program costs.~~169~~172
The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; P.L. 108- The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA; P.L. 108-
173), as modified by the Deficit Reduction Act of 2005 (DRA; P.L. 109-171), required that 173), as modified by the Deficit Reduction Act of 2005 (DRA; P.L. 109-171), required that
beginning in 2007, higher-income beneficiaries pay higher Part B premiums.beginning in 2007, higher-income beneficiaries pay higher Part B premiums.~~170 The income~~

~~169 T he Balanced Budget~~ 173 The income 172 The Balanced Budget Act of 1997 (BBA 97; P.L. 105-33) made a change that had the effect of increasing the Part B Act of 1997 (BBA 97; P.L. 105-33) made a change that had the effect of increasing the Part B
premium over time. Prior to BBA 97, both Parts A and B of Medicare covered home health services. Payments were premium over time. Prior to BBA 97, both Parts A and B of Medicare covered home health services. Payments were
made undermade under Part A, except for those few persons who had no Part A coverage. Part A, except for those few persons who had no Part A coverage. ~~T o~~To extend the solvency of the Part A extend the solvency of the Part A
(Hospital Insurance) (Hospital Insurance) ~~T rust~~Trust Fund, BBA Fund, BBA 97 gradually97 gradually transferred coverage of some home health visits from Part A to transferred coverage of some home health visits from Part A to
Part B. BeginningPart B. Beginning January 1, 2003, Part A covers only postJanuary 1, 2003, Part A covers only post -institutional home health services for up to 100 visits, -institutional home health services for up to 100 visits,
except for those persons with Part A coverage only who are covered without regardexcept for those persons with Part A coverage only who are covered without regard to the postto the post -institutional limitation. -institutional limitation.
Part B covers other home health services. Part B covers other home health services.
~~170 T he~~173 The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 ( Medicare Prescription Drug, Improvement, and Modernization Act of 2003 ( MMA; P.L. 108-173) increased the MMA; P.L. 108-173) increased the
Part B premium percentage for high-income enrollees; the Deficit Reduction Act of 2005 (DRA; P.L. 109-171) Part B premium percentage for high-income enrollees; the Deficit Reduction Act of 2005 (DRA; P.L. 109-171)
accelerated the phase-in period for suchaccelerated the phase-in period for such premiums. premiums.
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thresholds used to determine eligibility thresholds used to determine eligibility for the high-income premium are to be adjusted each year for the high-income premium are to be adjusted each year
by the growth in the Consumer Price Index.by the growth in the Consumer Price Index.~~171~~174 The Patient Protection and Affordable Care Act The Patient Protection and Affordable Care Act
(ACA; P.L. 111-148, as amended, Section 3402), however, froze these thresholds for the period of (ACA; P.L. 111-148, as amended, Section 3402), however, froze these thresholds for the period of
2011 through 2019 at the 2010 levels. In 2020, the thresholds were to return to the levels they 2011 through 2019 at the 2010 levels. In 2020, the thresholds were to return to the levels they
would have been had they been adjusted for inflation each year during the freeze and again would have been had they been adjusted for inflation each year during the freeze and again
indexed to inflation each year. As this would have resulted in higher income thresholds, it would indexed to inflation each year. As this would have resulted in higher income thresholds, it would
have had the effect of reducing the number of beneficiaries who paid the high-income premiums have had the effect of reducing the number of beneficiaries who paid the high-income premiums
in 2020. in 2020.
Section 402 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; Section 402 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-P.L. 114-
10) maintained the freeze on the income thresholds for 10) maintained the freeze on the income thresholds for al all income categories through 2017 and on income categories through 2017 and on
the lower two high-income premium tiers through 2019. Beginning in 2018, MACRA reduces the the lower two high-income premium tiers through 2019. Beginning in 2018, MACRA reduces the
threshold levels for the two highest income tiers so that more beneficiaries threshold levels for the two highest income tiers so that more beneficiaries ~~wil fal~~ will fall into the higher into the higher
percentage categories. (Seepercentage categories. (See “Legislative Changes to Income Thresholds~~.”) Additional y~~.”) Additionally, starting , starting
in 2020, the income thresholds for in 2020, the income thresholds for al all income categories are adjusted income categories are adjusted ~~annual y~~annually for inflation based for inflation based
on the 2019 income thresholds. This on the 2019 income thresholds. This ~~wil~~ will, in effect, maintain the proportion of beneficiaries who , in effect, maintain the proportion of beneficiaries who
pay the high-income premium. pay the high-income premium.
Due to a 0% Social Security COLA coupled with an increase in Medicare premiums, a large Due to a 0% Social Security COLA coupled with an increase in Medicare premiums, a large
percentage of Medicare Part B enrollees were protected by the hold-harmless provision in 2016 percentage of Medicare Part B enrollees were protected by the hold-harmless provision in 2016
and continued to pay the 2015 premium of $104.90 per month. The Medicare trustees estimated and continued to pay the 2015 premium of $104.90 per month. The Medicare trustees estimated
that the standard premiums of those not held harmless in 2016 would therefore need to be that the standard premiums of those not held harmless in 2016 would therefore need to be
increased to approximately $159 per month for aggregate premiums to increased to approximately $159 per month for aggregate premiums to ~~stil~~ still cover 25% of per cover 25% of per
capita benefit costs. The Bipartisan Budget Act of 2015 (BBAcapita benefit costs. The Bipartisan Budget Act of 2015 (BBA 15; P.L. 114-74), however, 15; P.L. 114-74), however,
mitigated this sharp premium increase and required that the 2016 Part B standard premium be mitigated this sharp premium increase and required that the 2016 Part B standard premium be
calculated as if the hold-harmless rule were not in effect and the increased costs had been spread calculated as if the hold-harmless rule were not in effect and the increased costs had been spread
across across al all beneficiaries. (Sebeneficiaries. (See Appendix D.)) Instead of having those not held harmless bear the Instead of having those not held harmless bear the
increase for increase for al all of the Part B enrollee population, the act of the Part B enrollee population, the act ~~al owed~~allowed for the transfer of additional for the transfer of additional
general revenues to the SMI Trust Fund to make up for the general revenues to the SMI Trust Fund to make up for the ~~shortfal~~ shortfall in premium revenue. As a in premium revenue. As a
result of this change, Part B enrollees not held harmless paid a standard monthly premium of result of this change, Part B enrollees not held harmless paid a standard monthly premium of
$121.80 in 2016. To offset the increased costs, a $3.00 surcharge was added to the monthly $121.80 in 2016. To offset the increased costs, a $3.00 surcharge was added to the monthly
premium in 2016 (the $121.80 premium amount included this surcharge), and premium in 2016 (the $121.80 premium amount included this surcharge), and ~~wil~~ was to continue to be continue to be
applied in subsequent years until the additional federal cost of about $9applied in subsequent years until the additional federal cost of about $9 ~~bil ion is fully offset (the~~
~~surcharge increases on a sliding scale for those who pay high-income premiums, up to $9.60).~~
~~BBA~~ .1 billion was fully offset. BBA 15 provided for similar premium adjustments in 201715 provided for similar premium adjustments in 2017, if there were a 0% Social Security if there were a 0% Social Security
COLA again in that year. However, as there was a 0.3% 2017 Social Security COLA, this COLA again in that year. However, as there was a 0.3% 2017 Social Security COLA, this
provision was not applicable in 2017. provision was not applicable in 2017.
Section 53114 of the Bipartisan Budget Act of 2018 (BBA Section 53114 of the Bipartisan Budget Act of 2018 (BBA 18; P.L. 115-123) added an additional 18; P.L. 115-123) added an additional
high-income category beginning in 2019 for individuals with annual incomes of $500,000 or high-income category beginning in 2019 for individuals with annual incomes of $500,000 or
more or couples filing jointlymore or couples filing jointly with incomes of $750,000 or more. Enrollees with income equal to with incomes of $750,000 or more. Enrollees with income equal to
or exceeding these thresholds pay premiums that cover 85% of the average per capita cost of Part or exceeding these thresholds pay premiums that cover 85% of the average per capita cost of Part
B benefits instead of 80%. The threshold for couples filing jointlyB benefits instead of 80%. The threshold for couples filing jointly in this new income tier is in this new income tier is
calculated as 150% of the individualcalculated as 150% of the individual income level rather than 200% as in the other income tiers. income level rather than 200% as in the other income tiers.
The BBAThe BBA 15 premium surcharge for this category is $10.20. This new top income threshold 15 premium surcharge for this category is $10.20. This new top income threshold ~~wil~~
will be frozen through 2027 and be frozen through 2027 and ~~wil~~ will be adjusted be adjusted ~~annual y~~annually for inflation starting in 2028 based on the for inflation starting in 2028 based on the
~~CPI-U.~~

~~171 Social~~ CPI-U. 174 Social Security Act §1839(i)(5). Security Act §1839(i)(5).
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Medicare Part B: Enrollment and Premiums

Due to potential impacts of the COVID-19 pandemic on Part B spending, Section 2401 of the Due to potential impacts of the COVID-19 pandemic on Part B spending, Section 2401 of the
Continuing Appropriations Act, 2021, and Other Extensions Act limited the growth in the Part B Continuing Appropriations Act, 2021, and Other Extensions Act limited the growth in the Part B
premium for 2021premium for 2021 ~~(see “Premium Calculation for 2021”). Specifical y~~. Specifically, the act required that the , the act required that the
2021 monthly actuarial rate for enrollees aged 65 and older be determined as the sum of the 2020 2021 monthly actuarial rate for enrollees aged 65 and older be determined as the sum of the 2020
monthly actuarial rate for enrollees aged 65 and older and one-fourth of the difference between monthly actuarial rate for enrollees aged 65 and older and one-fourth of the difference between
the 2020 monthly actuarial rate and the preliminary 2021 monthly actuarial rate (as determined by the 2020 monthly actuarial rate and the preliminary 2021 monthly actuarial rate (as determined by
the Secretary of HHS) for such enrollees. The monthly actuarial rate for 2021 was thus calculated the Secretary of HHS) for such enrollees. The monthly actuarial rate for 2021 was thus calculated
as follows: $283.20 (the actual actuarial rate for 2020) + (0.25 x ($314.30 (the unadjusted as follows: $283.20 (the actual actuarial rate for 2020) + (0.25 x ($314.30 (the unadjusted
monthly actuarial rate for 2021) - $283.20)) = $291.00 (rounded to the nearest dime). monthly actuarial rate for 2021) - $283.20)) = $291.00 (rounded to the nearest dime).
To offset the increased federal costs of this provision, a $3.00 surcharge will continue be added to the monthly premium until those costs (about $8.8 billion) are fully offset. (For those who pay high-income premiums, this surcharge increases on a sliding scale, up to $10.20). Table A-1. Monthly Part B Premiums, 1966-2022 ~~Table A-1. Monthly Part B Premiums, 1966-2020~~
Monthly
Effective
Year
Premium
Date
Governing Policy; Legislative Authority
1966 1966
$3.00 $3.00
7/1966 7/1966
Fixed dol ar amount; Social Security Amendments Fixed dol ar amount; Social Security Amendments (SSA) of 1965 (SSA) of 1965
1967 1967
$3.00 $3.00

Fixed dol ar amount; SSA of 1965 Fixed dol ar amount; SSA of 1965
1968 1968
$4.00 $4.00
4/1968 4/1968
Fixed dol ar amount through March; Medicare Enrol ment Fixed dol ar amount through March; Medicare Enrol ment Act of 1967. Act of 1967.
Beginning April:Beginning April: 50% of costs; SSA of 1965 50% of costs; SSA of 1965
1969 1969
$4.00 $4.00

50% of costs; SSA of 1967 50% of costs; SSA of 1967
1970 1970
$5.30 $5.30
7/1970 7/1970
50% of costs; SSA of 1967 50% of costs; SSA of 1967
1971 1971
$5.60 $5.60
7/1971 7/1971
50% of costs; SSA of 1967 50% of costs; SSA of 1967
1972 1972
$5.80 $5.80
7/1972 7/1972
50% of costs; SSA of 1967 50% of costs; SSA of 1967
1973 1973
$6.30 $6.30
9/1973 9/1973
50% of costs; SSA of 1967 (cost-of-living adjustment [COLA] limit, 50% of costs; SSA of 1967 (cost-of-living adjustment [COLA] limit,
added by SSA of 1972, could have applied, but was not needed). added by SSA of 1972, could have applied, but was not needed).
LimitationsLimitations ~~imposed~~ imposed by Economicby Economic Stabilization program set 7/1973 Stabilization program set 7/1973
amount at $5.80 and 8/73 amount at $6.10. amount at $5.80 and 8/73 amount at $6.10.
1974 1974
$6.70 $6.70
7/1974 7/1974
50% of costs; SSA of 1967 (COLA limit, 50% of costs; SSA of 1967 (COLA limit, added by SSA of 1972, could added by SSA of 1972, could
have applied, but was not needed) have applied, but was not needed)
1975 1975
$6.70 $6.70

Technical error Technical error in law prevented updating in law prevented updating
1976 1976
$7.20 $7.20
7/1976 7/1976
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1977 1977
$7.70 $7.70
7/1977 7/1977
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1978 1978
$8.20 $8.20
7/1978 7/1978
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1979 1979
$8.70 $8.70
7/1979 7/1979
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1980 1980
$9.60 $9.60
7/1980 7/1980
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1981 1981
$11.00 $11.00
7/1981 7/1981
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1982 1982
$12.20 $12.20
7/1982 7/1982
COLA limit; COLA limit; SSA of 1972 SSA of 1972
1983 1983
$12.20 $12.20

Tax Equity and Fiscal Responsibility Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) had set 25% Act of 1982 (TEFRA) had set 25%
rule for updates in 7/1983 and 7/1984. However,rule for updates in 7/1983 and 7/1984. However, SSA of 1983 froze SSA of 1983 froze
~~premiums~~ premiums 7/1983-12/1983 and changed future updates to January. 7/1983-12/1983 and changed future updates to January.
1984 1984
$14.60 $14.60
1/1984 1/1984
25% of costs; TEFRA, as amended by SSA of 1983 25% of costs; TEFRA, as amended by SSA of 1983
1985 1985
$15.50 $15.50
1/1985 1/1985
25% of costs; TEFRA, as amended by SSA of 1983 25% of costs; TEFRA, as amended by SSA of 1983
1986 1986
$15.50 $15.50
1/1986 1/1986
25% of costs; Deficit 25% of costs; Deficit Reduction Act (DEFRA) of 1984 Reduction Act (DEFRA) of 1984
1987 1987
$17.90 $17.90
1/1987 1/1987
25% of costs; DEFRA of 1984 25% of costs; DEFRA of 1984
1988 1988
$24.80 $24.80
1/1988 1/1988
25% of costs, Consolidated Omnibus Budget Reconciliation Act 25% of costs, Consolidated Omnibus Budget Reconciliation Act
(OBRA) of 1985 ~~(OBRA) of 1985~~
~~1989~~
~~$31.90~~
~~1/1989~~
~~25% of costs, OBRA 87, plus $4 catastrophic coverage premium added~~
~~by Medicare Catastrophic Coverage Act of 1988~~
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Medicare Part B: Enrollment and Premiums

Monthly
Effective
Year
Premium
Date
Governing Policy; Legislative Authority
1989 $31.90 1/1989 25% of costs, OBRA 87, plus $4 catastrophic coverage premium added by Medicare Catastrophic Coverage Act of 1988 1990 1990
$28.60 $28.60
1/1990 1/1990
25% of costs; OBRA 89. Medicare Catastrophic Coverage Repeal Act 25% of costs; OBRA 89. Medicare Catastrophic Coverage Repeal Act
of 1989 repealed additional catastrophic coverage premium,of 1989 repealed additional catastrophic coverage premium, effective effective
1/90 1/90
1991 1991
$29.90 $29.90
1/1991 1/1991
Fixed dol ar amount; OBRA 90 Fixed dol ar amount; OBRA 90
1992 1992
$31.80 $31.80
1/1992 1/1992
Fixed dol ar amount; OBRA 90 Fixed dol ar amount; OBRA 90
1993 1993
$36.60 $36.60
1/1993 1/1993
Fixed dol ar amount; OBRA 90 Fixed dol ar amount; OBRA 90
1994 1994
$41.10 $41.10
1/1994 1/1994
Fixed dol ar amount; OBRA 90 Fixed dol ar amount; OBRA 90
1995 1995
$46.10 $46.10
1/1995 1/1995
Fixed dol ar amount; OBRA 90 Fixed dol ar amount; OBRA 90
1996 1996
$42.50 $42.50
1/1996 1/1996
25% of costs; OBRA 93 25% of costs; OBRA 93
1997 1997
$43.80 $43.80
1/1997 1/1997
25% of costs; OBRA 93 25% of costs; OBRA 93
1998 1998
$43.80 $43.80
1/1998 1/1998
25% of costs; OBRA 93 and Balanced Budget Act (BBA) 97 25% of costs; OBRA 93 and Balanced Budget Act (BBA) 97
1999 1999
$45.50 $45.50
1/1999 1/1999
25% of costs; BBA 25% of costs; BBA 97 97
2000 2000
$45.50 $45.50
1/2000 1/2000
25% of costs; BBA 25% of costs; BBA 97 97
2001 2001
$50.00 $50.00
1/2001 1/2001
25% of costs; BBA 25% of costs; BBA 97 97
2002 2002
$54.00 $54.00
1/2002 1/2002
25% of costs; BBA 25% of costs; BBA 97 97
2003 2003
$58.70 $58.70
1/2003 1/2003
25% of costs; BBA 25% of costs; BBA 97 97
2004 2004
$66.60 $66.60
1/2004 1/2004
25% of costs; BBA 25% of costs; BBA 97 97
2005 2005
$78.20 $78.20
1/2005 1/2005
25% of costs; BBA 25% of costs; BBA 97 97
2006 2006
$88.50 $88.50
1/2006 1/2006
25% of costs; BBA 25% of costs; BBA 97 97
2007 2007
$93.50 $93.50
1/2007 1/2007
25% of costs; BBA 25% of costs; BBA 97 (Medicare Modernization Act of 2003 [MMA] 97 (Medicare Modernization Act of 2003 [MMA]
and Deficitand Deficit Reduction Act of 2005 [DRA] authorize higher premiums Reduction Act of 2005 [DRA] authorize higher premiums
for high-income enrol ees:for high-income enrol ees: 1st year of 3-year phase-in) 1st year of 3-year phase-in)
2008 2008
$96.40 $96.40
1/2008 1/2008
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees:high-income enrol ees: 2nd year of 3-year phase-in) 2nd year of 3-year phase-in)
2009 2009
$96.40 $96.40
1/2009 1/2009
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees:high-income enrol ees: 3rd year of 3-year phase-in) 3rd year of 3-year phase-in)
2010 2010
$110.50 $110.50
1/2010 1/2010
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees,high-income enrol ees, ful y phased-in); hold-harmlessful y phased-in); hold-harmless provision applied provision applied
to most enrol eesto most enrol ees who paid the 2009 rate of $96.40 who paid the 2009 rate of $96.40
2011 2011
$115.40 $115.40
1/2011 1/2011
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees;high-income enrol ees; the Patient Protection and Affordable Care Act the Patient Protection and Affordable Care Act
[ACA] freezes income[ACA] freezes income thresholds at 2010 levelsthresholds at 2010 levels from 2011 through from 2011 through
2019); hold-harmless provision applied to most2019); hold-harmless provision applied to most enrol eesenrol ees who paid the who paid the
2009 rate of $96.40 2009 rate of $96.40
2012 2012
$99.90 $99.90
1/2012 1/2012
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees;high-income enrol ees; ACA freezesACA freezes income thresholds at 2010 levels income thresholds at 2010 levels
from 2011 through 2019) from 2011 through 2019)
2013 2013
$104.90 $104.90
1/2013 1/2013
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees;high-income enrol ees; ACA freezesACA freezes income thresholds at 2010 levels income thresholds at 2010 levels
from 2011 through 2019) from 2011 through 2019)
2014 2014
$104.90 $104.90
1/2014 1/2014
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees;high-income enrol ees; ACA freezesACA freezes income thresholds at 2010 levels income thresholds at 2010 levels
from 2011 through 2019) Congressional Research Service 41 Medicare Part B: Enrollment and Premiums Monthly Effective Year Premium Date Governing Policy; Legislative Authority ~~from 2011 through 2019)~~
2015 2015
$104.90 $104.90
1/2015 1/2015
25% of costs; BBA 25% of costs; BBA 97 (MMA and DRA authorize higher premiums97 (MMA and DRA authorize higher premiums for for
high-income enrol ees;high-income enrol ees; ACA as modifiedACA as modified by the Medicare Access and by the Medicare Access and
CHIP Reauthorization Act of 2015 [MACRA] freezes income CHIP Reauthorization Act of 2015 [MACRA] freezes income
thresholds at 2010 levels fromthresholds at 2010 levels from 2011 through 2017) 2016 $121.80 1/2016 Less ~~2011 through 2017)~~
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39

~~Medicare Part B: Enrollment and Premiums~~

~~Monthly~~
~~Effective~~
~~Year~~
~~Premium~~
~~Date~~
~~Governing Policy; Legislative Authority~~
~~2016~~
~~$121.80~~
~~1/2016~~
~~Less~~ than 25% of costs; BBA 97 and BBA 15 (MMA and DRA authorize than 25% of costs; BBA 97 and BBA 15 (MMA and DRA authorize
higher premiumshigher premiums for high-income enrol ees;for high-income enrol ees; ~~ACA~~ ACA as modified by as modified by
MACRA freezes incomeMACRA freezes income thresholds at 2010 levelsthresholds at 2010 levels from 2011 through from 2011 through
2017); hold-harmless provision held the premium2017); hold-harmless provision held the premium at $104.90 for most at $104.90 for most
beneficiaries;beneficiaries; for those not held harmless,for those not held harmless, BBA 15 requiredBBA 15 required that 2016 that 2016
premiumspremiums be determined as if the hold-harmlessbe determined as if the hold-harmless provision wereprovision were not in not in
effect and effect and ~~al owed~~ allowed for additional federal general revenue transfers to for additional federal general revenue transfers to
the SMI Trust Fund to cover the the SMI Trust Fund to cover the ~~shortfal~~ shortfall in premiumin premium revenues; to revenues; to
offset the additional federaloffset the additional federal costs, a $3.00 repayment surchargecosts, a $3.00 repayment surcharge is is
being added to monthly premiumsbeing added to monthly premiums and wil continue until the ful and wil continue until the ful
amount is repaid amount is repaid
2017 2017
$134.00 $134.00
1/2017 1/2017
25% of costs plus $3.00 BBA 15 surcharge; BBA 25% of costs plus $3.00 BBA 15 surcharge; BBA 97 and BBA97 and BBA 15 (MMA 15 (MMA
and DRA authorize higher premiumsand DRA authorize higher premiums and surcharges for high-income and surcharges for high-income
enrol ees;enrol ees; ~~ACA~~ ACA as modified by MACRA freezes incomeas modified by MACRA freezes income thresholds at thresholds at
2010 levels2010 levels from 2011 through 2017); hold-harmless provision limited from 2011 through 2017); hold-harmless provision limited
the premiumthe premium increase for about 70% of enrol eesincrease for about 70% of enrol ees who paid monthly who paid monthly
~~premiums~~ premiums of $109.00, on average of $109.00, on average
2018 2018
$134.00 $134.00
1/2018 1/2018
25% of costs plus $3.00 BBA 15 surcharge; BBA 25% of costs plus $3.00 BBA 15 surcharge; BBA 97 and BBA97 and BBA 15 (MMA 15 (MMA
and DRA authorize higher premiumsand DRA authorize higher premiums and surcharges for high-income and surcharges for high-income
enrol ees;enrol ees; MACRA reduces the threshold levelsMACRA reduces the threshold levels for the two highest for the two highest
income tiersincome tiers and maintains the ACA freeze on the lowerand maintains the ACA freeze on the lower two tiers at two tiers at
the 2010 levels); about 28% of beneficiariesthe 2010 levels); about 28% of beneficiaries ~~were~~ were protected by the protected by the
hold-harmlesshold-harmless provision and paid reduced premiums provision and paid reduced premiums
2019 2019
$135.50 $135.50
1/2019 1/2019
25% of costs plus $3.00 BBA 15 surcharge; BBA 25% of costs plus $3.00 BBA 15 surcharge; BBA 97 and BBA97 and BBA 15 (MMA 15 (MMA
and DRA authorize higher premiumsand DRA authorize higher premiums and surcharges for high-income and surcharges for high-income
enrol ees;enrol ees; MACRA maintains the 2018 income thresholds; BBAMACRA maintains the 2018 income thresholds; BBA 18 18
adds an additional high-income tier for individuals earning $500,000 adds an additional high-income tier for individuals earning $500,000
per year or more); about 3.5% of beneficiariesper year or more); about 3.5% of beneficiaries are protected by the are protected by the
hold-harmlesshold-harmless provision and pay reduced premiums provision and pay reduced premiums
2020 2020
$144.60 $144.60
1/2020 1/2020
25% of costs plus $3.00 BBA 15 surcharge; BBA 25% of costs plus $3.00 BBA 15 surcharge; BBA 97 and BBA97 and BBA 15 (MMA 15 (MMA
and DRA authorize higher premiumsand DRA authorize higher premiums and surcharges for high-income and surcharges for high-income
enrol ees;enrol ees; ~~BBA~~ BBA 18 adds an additional high-income tier for individuals 18 adds an additional high-income tier for individuals
earning $500,000 per year or more). earning $500,000 per year or more).
2021 2021
$148.50 $148.50
1/2021 1/2021
25% of costs plus $3.00 BBA 15/P.L. 116-159 surcharge; BBA 97 and 25% of costs plus $3.00 BBA 15/P.L. 116-159 surcharge; BBA 97 and
BBA 15 (MMA and DRA authorize higher premiumsBBA 15 (MMA and DRA authorize higher premiums and surcharges for and surcharges for
high-income enrol ees).high-income enrol ees). 2021 premium increase2021 premium increase was limitedwas limited by P.L. by P.L.
116-159. 2022 $170.10 1/2022 25% of costs plus $3.00 P.L. 116-159 surcharge; BBA 97 and P.L. 116-159 (MMA and DRA authorize higher premiums and surcharges for high-income enrol ees). ~~116-159.~~
Sources: Various annual Medicare Trustees reports and CMS, “Medicare Program: Various annual Medicare Trustees reports and CMS, “Medicare Program: Medicare Part B Monthly Medicare Part B Monthly
Actuarial Rates, PremiumActuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, Rate, and Annual Deductible Beginning January 1, ~~20 21,” 85~~2022,” 86 Federal Register ~~71904~~64205, ,
NovemberNovember ~~12, 2020~~ 17, 2021. .

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link to page link to page 4648 link to page link to page 4648 link to page link to page 4648 link to page link to page ~~46 link to page 46 link to page 46 link to page 46 link to page 46~~48 link to page 48 link to page link to page 4648
Appendix B. Standard and High-Income Part B Premiums and Income
Thresholds: 2007-~~2021~~2022
Table B-1. Income Levels for Determining Part B Premium Adjustment and Per Person Premium Amounts, 2007-~~2021~~
2022 (in nominal (in nominal ~~dol ars)~~
~~2013-~~

dollars) 2013- 2007
2008
2009
2010
2011
2012
2015
2016
2017
2018
2019
2020
2021
2022 Standard
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than Less than than
Premium or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to
or equal to $80,000 $80,000
to $82,000 $82,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $85,000 $85,000
to $87,000 $87,000
to $88,000 to $91~~$88~~,000 ,000
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual Less than Less ~~Less~~ than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
Less Less than than
or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal or equal to or equal to to to to to to to to to to to to to to ~~or equal to~~
$160,000 $160,000
$164,000 $164,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$170,000 $170,000
$174,000 $174,000
$176 $176,000 $182,000 ,000
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple couple
$93.50
$96.40
$96.40~~96.40~~a
$110.5050b
$115.4040b
$99.90
$104.90
$121.8080b
$134.0000b
$134.0000b
$135.50b50
$144.60b60
$148.50b50 $170.10
Level 1
$80,001- $80,001-
$82,001- $82,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$85,001- $85,001-
$87,001- $87,001-
$88,001- $88,001-
$ $91,001- $100,000 100,000
$102,000 $102,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$107,000 $107,000
$109,000 $109,000
$111,000 $111,000
$114,000 individual individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
$160,001- $160,001-
$164,001- $164,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$170,001- $170,001-
$174,001- $174,001-
$176,001- $176,001-
$ $182,001- $200,000 200,000
$204,000 $204,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$218,000 $218,000
$222,000 $222,000
$228,000 couple couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
$105.80
$122.20
$134.90
$154.70
$161.50
$139.90
$146.90
$170.50
$187.50
$187.50
$189.60
$202.40
$207.90
$238.10 Level 2
$100,001- $100,001-
$102,001- $102,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$107,001- $107,001-
$109,001- $109,001-
$111,001 $111,001- $114,001--
$150,000 $150,000
$153,000 $153,000
$160,000 $160,000
$160,000 $160,000
$160,000 $160,000
$160,000 $160,000
$160,000 $160,000
$160,000 $160,000
$160,000 $160,000
$133,500 $133,500
$133,500 $133,500
$136,000 $136,000
$138,000 $138,000
$142,000 individual individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
$200,001- $200,001-
$204,001- $204,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$214,001- $214,001-
$218,001- $218,001-
$222,001 $222,001- $228,001--
$300,000 $300,000
$306,000 $306,000
$320,000 $320,000
$320,000 $320,000
$320,000 $320,000
$320,000 $320,000
$320,000 $320,000
$320,000 $320,000
$320,000 $320,000
$267,000 $267,000
$267,000 $267,000
$272,000 $272,000
$276,000 $276,000
$284,000 couple couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
$124.40
$160.90
$192.70
$221.00
$230.70
$199.80
$209.80
$243.60
$267.90
$267.90
$270.90
$289.20
$297.00
$340.20 Level 3
$150,001- $150,001-
$153,001- $153,001-
$160,001- $160,001-
$160,001- $160,001-
$160,001- $160,001-
$160,001- $160,001-
$160,001- $160,001-
$160,001- $160,001-
$160,001- $160,001-
$133,501- $133,501-
$133,501- $133,501-
$136,001- $136,001-
$138,001 $138,001- $142,001--
$200,000 $200,000
$205,000 $205,000
$213,000 $213,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$214,000 $214,000
$160,000 $160,000
$160,000 $160,000
$163,000 $163,000
$165,000 $165,000
$170,000 individual individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
$300,001- $300,001-
$306,001- $306,001-
$320,001- $320,001-
$320,001- $320,001-
$320,001- $320,001-
$320,001- $320,001-
$320,001- $320,001-
$320,001- $320,001-
$320,001- $320,001-
$267,001- $267,001-
$267,001- $267,001-
$272,001- $272,001-
$276,001 $276,001- $284,001--
$400,000 $400,000
$410,000 $410,000
$426,000 $426,000
$428,000 $428,000
$428,000 $428,000
$428,000 $428,000
$428,000 $428,000
$428,000 $428,000
$428,000 $428,000
$320,000 $320,000
$320,000 $320,000
$326,000 $326,000
$330,000 $330,000
$340,000 couple couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
couple
$142.90
$199.70
$250.50
$287.30
$299.90
$259.70
$272.70
$316.70
$348.30
$348.30
$352.20
$376.00
$386.10
$442.30 CRS-43~~CRS-41~~

~~2013-~~

2013- 2007
2008
2009
2010
2011
2012
2015
2016
2017
2018
2019
2020
2021
2022 Level 4 $160,001- $163,001- $165,001- $170,001- $~~Level 4~~
$200,000+ 200,000+
$205,000+ $205,000+
$213,000+ $213,000+
$214,000+ $214,000+
$214,000+ $214,000+
$214,000+ $214,000+
$214,000+ $214,000+
$214,000+ $214,000+
$214,000+ $214,000+
$160,000+ $160,000+
$ $~~160,001-~~
~~$163,001-~~
~~$165,001-~~499,999 $499,999 $499,999 $499,999
individual
individual
individual
individual
individual
individual
individual
individual
individual
individual
~~$499,999~~
~~$499,999~~
~~$499,999~~individual individual individual individual
$400,000+ $400,000+
$410,000+ $410,000+
$426,000+ $426,000+
$428,000+ $428,000+
$428,000+ $428,000+
$428,000+ $428,000+
$428,000+ $428,000+
$428,000+ $428,000+
$428,000+ $428,000+
$320,000+ $320,000+
~~individual~~
~~individual~~
~~individual~~$320,001- $326,001- $330,001- $340,001-
couple
couple
couple
couple
couple
couple
couple
couple
couple
~~couple~~
~~$320,001-~~
~~$326,001-~~
~~$330,001-~~ couple $749,999 $749,999 $749,999 $749,999 couple couple couple couple
$161.40
$238.40
$308.30
$353.60
$369.10
$319.70
$335.70
$389.80
$428.60
$428.60
~~$749,999~~
~~$749,999~~
~~$749,999~~
~~couple~~
~~couple~~
~~couple~~
~~$433.40~~
~~$462.70~~
~~$475.20~~$433.40 $462.70 $475.20 $544.30
Level 5
n/a n/a
n/a n/a
n/a n/a
n/a n/a
n/a n/a
n/a n/a
n/a n/a
n/a n/a
n/a n/a
n/a n/a
$500,000 $500,000
$500,000 $500,000
$500,000 $500,000
$500,000 or more or more
or more or more
or more or more
or more individual individual
individual
individual
$750,000 $750,000
$750,000 $750,000
$750,000 $750,000
$750,000 or more or more
or more or more
or more or more
~~couple~~
~~couple~~
or more couple couple couple couple
$460.50
$491.60
$504.90 $578.30
Sources: CMS, Annual Notices,CMS, Annual Notices, “Medicare Program;“Medicare Program; Medicare Part B Monthly Actuarial Rates, PremiumMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible,” 2007 through Rate, and Annual Deductible,” 2007 through ~~20 20~~2021, and CMS, , and CMS,
“Medicare Program:“Medicare Program: Medicare Part B Monthly Actuarial Rates, PremiumMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, Rate, and Annual Deductible Beginning January 1, ~~20 21,” 84~~2022,” 85 Federal Register ~~71904~~64205, November , November ~~12,~~
~~2020~~17, 2021. .
Note: n/a = not applicable. When both are enrol ed in Part B, each person in a couple pays the samen/a = not applicable. When both are enrol ed in Part B, each person in a couple pays the same individual premiumindividual premium amount. Bottom thresholds in Levelsamount. Bottom thresholds in Levels 2 through 2 through
4 are rounded up to the nearest dol ar, and the upper threshold in Level4 are rounded up to the nearest dol ar, and the upper threshold in Level 4 for 2019 through 4 for 2019 through ~~2021~~2022 are rounded down to the nearest dol ar. are rounded down to the nearest dol ar. Income thresholds are based Income thresholds are based
on a Medicare-specificon a Medicare-specific definition of modifieddefinition of modified adjusted gross incomeadjusted gross income (MAGI). (MAGI).
a. The standard Part B premiuma. The standard Part B premium in 2009 was the same as that in 2008; however, the lack of change was not due to the holdin 2009 was the same as that in 2008; however, the lack of change was not due to the hold -harmless-harmless provision.provision. CMS determinedCMS determined that that
2008 premiums 2008 premiums and revenuesand revenues were slightly higher than needed to coverwere slightly higher than needed to cover costs in that year and that 2009 financing would be adequate at the same premiumcosts in that year and that 2009 financing would be adequate at the same premium level. level.
b. Due to no Social Security COLA in 2010 and 2011, most Part B enrol ees b. Due to no Social Security COLA in 2010 and 2011, most Part B enrol ees ~~were~~ were held harmlessheld harmless and paid the 2009 standard monthlyand paid the 2009 standard monthly ~~premium~~ premium of $96.40. Similarly,of $96.40. Similarly, in in
2016, those who were held harmless 2016, those who were held harmless paid the 2015 premiumpaid the 2015 premium of $104.90 per month, and those who were held harmlessof $104.90 per month, and those who were held harmless in 2017 paid, on in 2017 paid, on ~~averag e~~average, $109.00 per , $109.00 per
month. In 2018, about 28% of enrol eesmonth. In 2018, about 28% of enrol ees ~~were~~ were protected under the hold-harmlessprotected under the hold-harmless provision and paid premiumsprovision and paid premiums of less than $134.00 per month. CRS-44~~of less than $134.00 per month. In 2019, 2020, and~~
~~2021, a smal number of enrol ees were/are protected under the hold-harmless provision and paid/pay less than the standard monthly premium amount.~~
~~CRS-42~~

Table B-2. Income Levels for Determining Part B Premium Adjustment for Married Beneficiaries Filing Separately and
Associated Premiums, 2007-~~2021~~2022
(in nominal (in nominal ~~dol ars~~dollars) )
Income
2013-
Level
2007
2008
2009
2010
2011
2012
2015
2016
2017
2018
2019
2020
2021
~~Standard~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~Less than~~
~~or equal to or equal to or equal to or equal to or equal to or equal to or equal to or equal to or equal to or equal to or equal to or equal to or equal~~ 2022 Standard Less than Less than Less than Less than Less than Less than Less than Less than Less than Less than Less than Less than Less than Less than or equal or equal or equal or equal or equal or equal or equal or equal or equal or equal or equal or equal or equal or equal to to to to to to to to to to to to to to to
$80,000 $80,000
$82,000 $82,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$87,000 $87,000
$88 $88,000 $91,000 ,000
$93.50
$96.40
$96.40
$110.50
$115.40
$99.90
$104.90
$121.80
$134.00
$134.00
$135.50
$144.60
$148.50
$170.10 Lower Lower
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
~~Not~~Greater
Greater Greater
Greater Greater
Greater Greater
Adjustment Adjustment
than than
than than
than than
than than
than than
than than
than than
than than
than than
~~applicable~~than
than than
than than
than than
Category Category
$80,000 $80,000
$82,000 $82,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$85,000 $85,000
$87,000 $87,000
$88,000 $88,000
$91,000 and less and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
and less and less
than or than or
than or than or
than or than or
than or than or
than or than or
than or than or
than or than or
than or than or
than or than or
n/a than than than
than than
than than
equal to equal to
equal to equal to
equal to equal to
equal to equal to
equal to equal to
equal to equal to
equal to equal to
equal to equal to
equal to equal to
$415,000 $415,000
$413,000 $413,000
$412,000 $412,000
$ $409,000 $120,000 120,000
$123,000 $123,000
$128,000 $128,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
~~$433.40~~
~~$462.70~~
~~$475.20~~
~~$142.90~~
~~$199.70~~
~~$250.50~~
~~$287.30~~
~~$299.90~~
~~$259.70~~
~~$272.70~~
~~$316.70~~
~~$348~~ $142.90 $199.70 $250.50 $287.30 $299.90 $259.70 $272.70 $316.70 $348.30 $433.40 $462.70 $475.20 $544.30
Higher Higher
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Greater
Greater Adjustment Adjustment
than than
than than
than than
than than
than than
than than
than than
than than
than than
than than
than or than or
than or than or
than or than or
than or Category Category
$120,000 $120,000
$123,000 $123,000
$128,000 $128,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$129,000 $129,000
$85,000 $85,000
equal to equal to
equal to equal to
equal to equal to
equal to $415,000 $413,000 $412,000 $409,000 $161.40
$238.40
$308.30
$353.60
$369.10
$319.70
$335.70
$389.80
$428.60
~~$428.60~~
~~$415,000~~
~~$413,000~~
~~$412,000~~ $428.60
$460.50
$491.60
$504.90 $578.30
Sources: CMS, Annual Notices,CMS, Annual Notices, “Medicare Program; Medicare Part B Monthly Actuarial Rates, Premium“Medicare Program; Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible,” 2007 Rate, and Annual Deductible,” 2007 ~~t hrough 2020~~through 2021, and CMS, , and CMS,
“Medicare Program:“Medicare Program: Medicare Part B Monthly Actuarial Rates, PremiumMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning Rate, and Annual Deductible Beginning ~~Jan uary~~January 1, 2021,” 1, 2021,” 8586 Federal Register ~~71904~~64205, November , November ~~12,~~
~~2020.~~
17, 2021. Note: Income thresholds are based on a Medicare-specific definition of modified Income thresholds are based on a Medicare-specific definition of modified adjusted gross income (MAGI). adjusted gross income (MAGI).
n/a = not-applicable. CRS-45
~~CRS-43~~

link to page link to page 4850 Medicare Part B: Enrollment and Premiums

Appendix C. Estimated Future Part B Premiums
Table C-1. Projected Part B Premiums

Percentage of Program Costs Represented by Premium
25%

(Standard)
35%
50%
65%
80%
85%a
Actual

2017
$134.00 $134.00
$187.50 $187.50
$267.90 $267.90
$348.30 $348.30
$428.60 $428.60
— —
2018
134.00 134.00
187.50 187.50
267.90 267.90
348.30 348.30
428.60 428.60
— —
2019
135.50 135.50
189.60 189.60
270.90 270.90
352.20 352.20
433.40 433.40
$460.50 $460.50
2020
144.60 144.60
202.40 202.40
289.20 289.20
376.00 376.00
462.70 462.70
491.60 491.60
2021
148.50 148.50
207.90 207.90
297.90 297.90
386.10 386.10
475.20 475.20
504.90 504.90
2022 170.10 238.10 340.20 442.30 544.30 578.30 Projected

~~2022~~
~~157.70~~
~~220.70~~
~~315.30~~
~~409.90~~
~~504.50~~
~~536.00~~
~~2023~~
~~166.70~~
~~233.40~~
~~333.40~~
~~433.40~~
~~533.40~~
~~566.80~~
~~2024~~
~~176.60~~
~~247.20~~
~~353.20~~
~~459.20~~
~~565.10~~
~~600.40~~
~~2025~~
~~187.30~~
~~262.20~~
~~374.50~~
~~486.90~~
~~599.20~~
~~636.70~~
~~2026~~
~~197.90~~
~~277.10~~
~~395.80~~
~~514.50~~
~~633.30~~
~~672.90~~
~~2027~~
~~209.50~~
~~293.20~~
~~418.90~~
~~544.60~~
~~670.20~~
~~712.10~~
~~2028~~
~~221.50~~
~~310.10~~
~~443.00~~
~~575.90~~
~~708.80~~
~~753.10~~
~~2029~~
~~234.10~~
~~327.70~~
~~468.20~~
~~608.70~~
~~749.10~~
~~795.90~~
~~Sources:~~ ~~2020~~2023 169.90 237.90 339.80 441.70 543.70 577.70 2024 180.60 252.80 361.20 469.60 577.90 614.00 2025 188.20 263.50 376.40 489.30 602.20 639.90 2026 198.90 278.50 397.80 517.10 636.50 676.30 2027 210.20 294.30 420.40 546.50 672.60 714.70 2028 222.70 311.70 445.30 578.90 712.50 757.00 2029 235.80 330.00 471.50 613.00 754.40 801.60 2030 248.60 348.00 497.10 646.20 795.40 845.10 Sources: 2021 Medicare Trustees Report, Tables V.E2 and V.E3, and CMS, “Medicare Program: Medicare Trustees Report, Tables V.E2 and V.E3, and CMS, “Medicare Program: Medicare Part B Medicare Part B
Monthly Actuarial Rates, PremiumMonthly Actuarial Rates, Premium Rate, and Annual Deductible Beginning January 1, Rate, and Annual Deductible Beginning January 1, ~~2021,” 85~~2022,” 86 Federal Register
~~71904~~64205, November , November ~~12, 2020~~17, 2021. .
Notes: The figures beyond The figures beyond ~~2021~~2022 only represent only represent ~~estimates~~ estimates of future premiums.of future premiums. Actual premiumsActual premiums are determined are determined
each year in the each year in the ~~fal prior~~ fall prior to the actual year the premiumto the actual year the premium wil be in effect. ~~wil be in effect. The above projections do not take into~~
~~account the potential effects of the COVID-19 public health emergency. At this time, it is unclear what effect the~~
~~pandemic wil have on future Medicare Part B spending and premiums.~~
a. The Bipartisan Budget Act of 2018 (BBA 18; P.L.a. The Bipartisan Budget Act of 2018 (BBA 18; P.L. 115-123) added an additional income115-123) added an additional income tier with premiums tier with premiums
set at 85% of per capita program set at 85% of per capita program costs starting in 2019. costs starting in 2019.
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Medicare Part B: Enrollment and Premiums

Appendix D. Bipartisan Budget Act of 2015 Changes
to 2016 Part B Premiums
Under normal circumstances, standard Medicare Part B premiums are set at an amount to cover Under normal circumstances, standard Medicare Part B premiums are set at an amount to cover
25% of projected average per capita Part B expenditures plus an appropriate contingency margin. 25% of projected average per capita Part B expenditures plus an appropriate contingency margin.
Due to expected growth in the cost of Part B benefits, the Medicare trustees projected that in Due to expected growth in the cost of Part B benefits, the Medicare trustees projected that in
order to cover 25% of benefit costs as order to cover 25% of benefit costs as ~~wel~~ well as to build up adequate contingency reserves, the 2016 as to build up adequate contingency reserves, the 2016
Part B premiums would need to be increased to about $121 per month from the 2015 amount of Part B premiums would need to be increased to about $121 per month from the 2015 amount of
$104.90.$104.90.~~172~~175 However, due to the absence of a Social Security COLA in 2016 and the resulting However, due to the absence of a Social Security COLA in 2016 and the resulting
widespread application of the hold-harmless provision, most Part B enrollees continued to pay the widespread application of the hold-harmless provision, most Part B enrollees continued to pay the
2015 premium amount of $104.90 through 2016. With about 70% of enrollees continuing to pay 2015 premium amount of $104.90 through 2016. With about 70% of enrollees continuing to pay
$104.90, the only way that premiums could cover 25% of per capita expenditures would have $104.90, the only way that premiums could cover 25% of per capita expenditures would have
been if those not held harmless (the remaining 30%) bore the entire cost increase (i.e., if the been if those not held harmless (the remaining 30%) bore the entire cost increase (i.e., if the
aggregate increase in premiums were spread out over fewer people). The Medicare trustees aggregate increase in premiums were spread out over fewer people). The Medicare trustees
estimated that the premiums of those not held harmless would therefore need to be increased to estimated that the premiums of those not held harmless would therefore need to be increased to
about $159 per month.about $159 per month.~~173~~176 The trustees also estimated that high-income beneficiaries (i.e., those The trustees also estimated that high-income beneficiaries (i.e., those
earning more than $85,000) would need to pay significantly higher monthly premiums of about earning more than $85,000) would need to pay significantly higher monthly premiums of about
$223, $319, $414, or $510 depending on their level of income (compared to their respective 2015 $223, $319, $414, or $510 depending on their level of income (compared to their respective 2015
premiums of $147, $210, $273, and $336 per month). premiums of $147, $210, $273, and $336 per month).
To mitigate the expected large premium increases for those not held harmless, the Bipartisan To mitigate the expected large premium increases for those not held harmless, the Bipartisan
Budget Act of 2015 (BBABudget Act of 2015 (BBA 15; P.L. 114-74) required that 2016 Medicare Part B premiums be set 15; P.L. 114-74) required that 2016 Medicare Part B premiums be set
as if the hold-harmless rule were not in effect—in other words, to calculate premiums as if as if the hold-harmless rule were not in effect—in other words, to calculate premiums as if al
all enrollees were paying the same annual inflation-adjusted standard premium (about $121 per enrollees were paying the same annual inflation-adjusted standard premium (about $121 per
month). To compensate for the lost premium revenue (below the required 25%) and to ensure that month). To compensate for the lost premium revenue (below the required 25%) and to ensure that
the Supplementary Medical Insurance (SMI) Trust Fund had adequate income to cover payments the Supplementary Medical Insurance (SMI) Trust Fund had adequate income to cover payments
for Part B benefits in 2016, the act for Part B benefits in 2016, the act ~~al owed~~allowed for additional transfers from the General Fund of the for additional transfers from the General Fund of the
Treasury to the SMI Trust Fund. Treasury to the SMI Trust Fund.
To offset the approximately $9 To offset the approximately $9 ~~bil ion~~ billion in increased federal spending in 2016 resulting from the in increased federal spending in 2016 resulting from the
reduction in standard premiums for those not held harmless (i.e., the additional amounts reduction in standard premiums for those not held harmless (i.e., the additional amounts
transferred from the General Fund), as transferred from the General Fund), as ~~wel~~ well as the loss of income due to reductions in the income-as the loss of income due to reductions in the income-
related monthly adjustment for high-income enrollees, the law required that a $3.00 per month related monthly adjustment for high-income enrollees, the law required that a $3.00 per month
surcharge be added to standard premiums in 2016, and each subsequent year, until the $9 surcharge be added to standard premiums in 2016, and each subsequent year, until the $9 ~~bil ion~~
isbillion was fully offset. fully offset.~~174~~177 (For those who pay high-income premiums, the surcharge increases on a sliding (For those who pay high-income premiums, the surcharge increases on a sliding
scale, up to $scale, up to $~~9.60~~10.20.) It .) It iswas expected that this surcharge expected that this surcharge ~~wil~~ would be applied to premiums through 2021.be applied to premiums through 2021.~~175~~
178 The monthly repayment surcharge is paid only by those not held harmless. The monthly repayment surcharge is paid only by those not held harmless.

~~172 2015 Medicare T rustees Report , p. 32.~~
~~173 See CRS~~ 175 2015 Medicare Trustees Report, p. 32. 176 See CRS Report R44224, Report R44224, Potential Impact of No Social Security COLA on Medicare Part B Premiums in 2016. .
~~174 T he~~177 The $9 billion consists of about $7.4 billion in increased federal spending $9 billion consists of about $7.4 billion in increased federal spending ~~due~~ due to the reduced standard premiums and to the reduced standard premiums and
about $1.6 billion in lost revenues dueabout $1.6 billion in lost revenues due to the reduction in highto the reduction in high -income adjustments. -income adjustments. ~~T he~~The $3.00 standard premium $3.00 standard premium
surchargesurcharge “pays for” the increased general revenue transfers in 2016, while the additional high“pays for” the increased general revenue transfers in 2016, while the additional high -income surcharge -income surcharge
adjustments are usedadjustments are used to offset the reduction in the income-related adjustment amounts. CMS, “to offset the reduction in the income-related adjustment amounts. CMS, “ Medicare Program: Medicare Program:
Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual DeductibleMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible ~~Beginning~~ Beginning January 1, 2016,” 80 January 1, 2016,” 80
Federal Register 70811, November 16, 2015. 70811, November 16, 2015.
~~175~~ 178 2020 Medicare 2020 Medicare ~~T rustees Report, p. 84. In the final year of the repayment adjustments, the surcharge may be set at~~
~~less than $3.00 to avoid overpayment.~~
Trustees Report, p. 84. Congressional Research Service Congressional Research Service

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Medicare Part B: Enrollment and Premiums

Should there have been a 0% Social Security COLA in 2017, BBA Should there have been a 0% Social Security COLA in 2017, BBA ~~15 al owed~~ 15 allowed for a similar for a similar
Medicare Part B premium setting mechanism for 2017. However, as there was a 0.3% COLA in Medicare Part B premium setting mechanism for 2017. However, as there was a 0.3% COLA in
2017, this provision did not apply. BBA2017, this provision did not apply. BBA 15 did not 15 did not ~~al ow~~allow for similar adjustments beyond 2017. for similar adjustments beyond 2017.

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Medicare Part B: Enrollment and Premiums

Appendix E. Application of the Hold-Harmless
Provision in Years Prior to ~~2021~~2022
Application of the Hold-Harmless Rule in Years Prior to 2016
As described earlier, an individual’s Social Security COLA is determined by multiplyingAs described earlier, an individual’s Social Security COLA is determined by multiplying his or his or
her benefit amount by the inflation rate, the CPI-W. Part B premiums are determined by projected her benefit amount by the inflation rate, the CPI-W. Part B premiums are determined by projected
Part B program costs. Thus, the number of people held harmless can vary widely from year to Part B program costs. Thus, the number of people held harmless can vary widely from year to
year, depending on inflation rates and projected Part B costs. For most years, the hold-harmless year, depending on inflation rates and projected Part B costs. For most years, the hold-harmless
provision affected a relatively provision affected a relatively ~~smal~~ small number of beneficiaries.number of beneficiaries.~~176~~179 However, due to low inflation, no However, due to low inflation, no
COLA adjustments were made to Social Security benefits in 2010 and 2011. Most Medicare COLA adjustments were made to Social Security benefits in 2010 and 2011. Most Medicare
beneficiaries (about 73%) were protected by the hold-harmless provision and continued to pay the beneficiaries (about 73%) were protected by the hold-harmless provision and continued to pay the
2009 standard monthly premium of $96.40 in both 2010 and 2011.2009 standard monthly premium of $96.40 in both 2010 and 2011.~~177~~180 Because Part B Because Part B
expenditures were expenditures were ~~stil~~ still expected to increase in those years, and because beneficiary premiums are expected to increase in those years, and because beneficiary premiums are
required to cover 25% of those costs, the premiums for those not held harmless (27% of required to cover 25% of those costs, the premiums for those not held harmless (27% of
beneficiaries) were higher than they would have been had the rest of the beneficiaries not been beneficiaries) were higher than they would have been had the rest of the beneficiaries not been
held harmless. The standard monthly premiums paid by those not held harmless were $110.50 in held harmless. The standard monthly premiums paid by those not held harmless were $110.50 in
2010 and $115.40 in 2011.2010 and $115.40 in 2011.~~178~~181 In 2011, of the 27% who were not eligible to be held harmless, In 2011, of the 27% who were not eligible to be held harmless,
about 3% were new Medicare enrollees, about 5% were high-income, about 17% had their about 3% were new Medicare enrollees, about 5% were high-income, about 17% had their
premiums paid for by Medicaid, and the remaining 2% did not have their premiums withheld premiums paid for by Medicaid, and the remaining 2% did not have their premiums withheld
from Social Security benefit payments. from Social Security benefit payments.
In 2012 and 2013, Social Security beneficiaries received a 3.6% and a 1.7% COLA, respectively, In 2012 and 2013, Social Security beneficiaries received a 3.6% and a 1.7% COLA, respectively,
which more than covered the Part B premium increases in those years; therefore, the hold-which more than covered the Part B premium increases in those years; therefore, the hold-
harmless provision was not applicable for most beneficiaries. Similarly, in 2014 and 2015, with harmless provision was not applicable for most beneficiaries. Similarly, in 2014 and 2015, with a
Social Security COLA Social Security COLA ~~increase~~increases of 1.5% and 1.7%, respectively, and no increase in Part B of 1.5% and 1.7%, respectively, and no increase in Part B
premiums, the hold-harmless provision also was not broadly applicable in those years.premiums, the hold-harmless provision also was not broadly applicable in those years.~~179~~
182 Application of the Hold-Harmless Rule in 2016
In 2016, for a third time, there was no Social Security COLA increase, but there was a projected In 2016, for a third time, there was no Social Security COLA increase, but there was a projected
increase in Medicare Part B premiums—from $104.90 per month in 2015 to about $121 per increase in Medicare Part B premiums—from $104.90 per month in 2015 to about $121 per
month in 2016.month in 2016.~~180~~183 Similar to its application in 2010 and 2011, the hold-harmless provision as Similar to its application in 2010 and 2011, the hold-harmless provision as

~~176~~ 179 For additional information, see Actuarial Note No. 147, by Jacqueline For additional information, see Actuarial Note No. 147, by Jacqueline A. Walsh and Burt M. Kestenbaum, March A. Walsh and Burt M. Kestenbaum, March
2006, at http://www.ssa.gov/OACT2006, at http://www.ssa.gov/OACT ~~/NOT ES~~/NOTES/pdf_notes/note147.pdf. /pdf_notes/note147.pdf.
~~177 T he~~ 180 The standard Part B premium in 2009 was standard Part B premium in 2009 was also the same asalso the same as that in 2008, $96.40; however, the lack of change in that in 2008, $96.40; however, the lack of change in
those years wasthose years was not a result of the hold-harmless provision. At the end of 2008, it was determined that Part B premiums not a result of the hold-harmless provision. At the end of 2008, it was determined that Part B premiums
and general revenue financing in recent years had been set at somewhat higher levels than otherwise wouldand general revenue financing in recent years had been set at somewhat higher levels than otherwise would be be required required
to maintain an adequate contingency reserve, and that the level of assets in the Part B account of the SMI to maintain an adequate contingency reserve, and that the level of assets in the Part B account of the SMI ~~T rust~~Trust Fund Fund
werewere more than adequate. more than adequate. ~~T herefore~~Therefore, it was estimated that, it was estimated that an adequate level of assets couldan adequate level of assets could be be maintained throughout maintained throughout
the next year, 2009, without an increase in premiums. the next year, 2009, without an increase in premiums.
~~178~~181 Most new enrollees in 2010 were eligible Most new enrollees in 2010 were eligible to be held harmless in the second year of no COLAto be held harmless in the second year of no COLA (i.e., 2011); these (i.e., 2011); these
individualsindividuals ~~cont inued~~ continued to pay the 2010 standard premium of $110.50 in 2011. to pay the 2010 standard premium of $110.50 in 2011.
~~179~~ 182 SSA, SSA, “Cost-of-Living Adjustment (COLA),” at http://www.socialsecurity.gov/cola/, and SSA“Cost-of-Living Adjustment (COLA),” at http://www.socialsecurity.gov/cola/, and SSA Fact Sheet, “2015 Fact Sheet, “2015
SocialSocial Security Changes,”Security Changes,” at at http://www.ssa.gov/news/press/factsheets/colafacts2015.html. http://www.ssa.gov/news/press/factsheets/colafacts2015.html.
~~180~~183 Boards of Boards of ~~T rustees~~Trustees, Federal Hospital Insurance and Federal, Federal Hospital Insurance and Federal Supplementary MedicalSupplementary Medical Insurance Insurance ~~T rust~~Trust Funds, Funds, 2015
Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal ~~Supplem entary~~Supplementary Medical
Insurance Trust Funds, July, July 22, 2015, p. 32, at https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-22, 2015, p. 32, at https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-
~~T rends~~Trends-and-Reports/ReportsTrustFunds/index.html. -and-Reports/ReportsTrustFunds/index.html.
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applied in 2016 protected some beneficiaries but not others. In 2016, about 70% of Part B applied in 2016 protected some beneficiaries but not others. In 2016, about 70% of Part B
enrollees were held harmless and continued to pay the 2015 monthly premium amount of $104.90 enrollees were held harmless and continued to pay the 2015 monthly premium amount of $104.90
through 2016. Those through 2016. Those not held harmless held harmless included those eligible for premium assistance through included those eligible for premium assistance through
their state Medicaid programs (about 19%), those who paid the high-income premiums (about their state Medicaid programs (about 19%), those who paid the high-income premiums (about
6%), those who did not receive Social Security benefits (3%), and new enrollees in 2016 (5%).6%), those who did not receive Social Security benefits (3%), and new enrollees in 2016 (5%).~~181~~184
Absent legislation, Absent legislation, the premiums of those not held harmless (the remaining 30%) would have the premiums of those not held harmless (the remaining 30%) would have
been higher than the premiums would have been had the hold-harmless provision not been in been higher than the premiums would have been had the hold-harmless provision not been in
effect.effect.~~182~~185 However, BBA 15 mitigated the expected large increases for those not held harmless However, BBA 15 mitigated the expected large increases for those not held harmless
and required that their premiums be calculated as if the hold-harmless rule were not in effect. and required that their premiums be calculated as if the hold-harmless rule were not in effect.
BBABBA 15 also required that a monthly surcharge of $3.00 be added to standard premiums (more for 15 also required that a monthly surcharge of $3.00 be added to standard premiums (more for
those with high incomes) until the increased cost to the federal government of reducing the those with high incomes) until the increased cost to the federal government of reducing the
premiums is offset. (Sepremiums is offset. (See Appendix D.)) The total standard premium amount for those Part B The total standard premium amount for those Part B
enrollees not held harmless in 2016, including the $3.00 per month surcharge, was $121.80.enrollees not held harmless in 2016, including the $3.00 per month surcharge, was $121.80.~~183~~
186 Application of the Hold-Harmless Rule in 2017
Should there have been a 0% Social Security COLA in 2017, BBAShould there have been a 0% Social Security COLA in 2017, BBA 15 would have 15 would have ~~al owed~~allowed for a for a
similar Medicare Part B premium setting mechanism for 2017 as in 2016. However, as there was similar Medicare Part B premium setting mechanism for 2017 as in 2016. However, as there was
a very a very ~~smal~~ small (0.3%) Social Security COLA in 2017, this provision did not apply. (0.3%) Social Security COLA in 2017, this provision did not apply.
Because the Social Security COLA was not large enough to cover the full Medicare Part B Because the Social Security COLA was not large enough to cover the full Medicare Part B
premium increase, about 70% of enrollees were held harmless in 2017. Those held harmless in premium increase, about 70% of enrollees were held harmless in 2017. Those held harmless in
2017 paid, on average, about $109.00 per month for their Part B premiums. However, their actual 2017 paid, on average, about $109.00 per month for their Part B premiums. However, their actual
premiums varied depending on the dollar amount of the increase in their Social Security premiums varied depending on the dollar amount of the increase in their Social Security
benefit.benefit.~~184 Additional y,~~ 187 Additionally, many of those not held harmless in 2016 because they were new to many of those not held harmless in 2016 because they were new to
Medicare in that year may have qualified to be held harmless in 2017. If they qualified, the Medicare in that year may have qualified to be held harmless in 2017. If they qualified, the
premiums for those individuals would have been equal to the 2016 premium of $121.80, plus the premiums for those individuals would have been equal to the 2016 premium of $121.80, plus the
dollar amount of the increase in their monthly Social Security benefit. dollar amount of the increase in their monthly Social Security benefit.
As the premiums of those not held harmless (the remaining 30% of enrollees) had to cover both As the premiums of those not held harmless (the remaining 30% of enrollees) had to cover both
their share of the premium increases plus that of the 70% held harmless,their share of the premium increases plus that of the 70% held harmless,~~185~~188 the Medicare trustees the Medicare trustees
estimated that their 2017 Part B premiums could be as high as $149 per month.estimated that their 2017 Part B premiums could be as high as $149 per month.~~186 However, in~~

~~181~~189 However, in 184 As there is some overlap in categories—for example, some individuals As there is some overlap in categories—for example, some individuals may pay the high-income premiums and not may pay the high-income premiums and not
yet receive Socialyet receive Social Security benefits—these figuresSecurity benefits—these figures sum to more than 30%. sum to more than 30%.
~~182~~ 185 In the absence of BBA In the absence of BBA 15, the standard premiums of those not held harmless would15, the standard premiums of those not held harmless would have increased byhave increased by about 52%, about 52%,
compared with an increase of about 16% that wouldcompared with an increase of about 16% that would have been paid by allhave been paid by all enrollees had the hold-harmless rule not been enrollees had the hold-harmless rule not been
in effect. For additional details on how premiums wouldin effect. For additional details on how premiums would have been set for those not held harmless absent the enactment have been set for those not held harmless absent the enactment
of BBAof BBA 15, see CRS15, see CRS Report R44224, Report R44224, Potential ~~Im pact~~Impact of No Social Security COLA on Medicare Part B ~~Prem ium s~~Premiums in
2016. .
~~183 T he CMS~~ 186 The CMS actuaries determined a 2016 standard premium of $118.80 per month. After the addition of the $3 per actuaries determined a 2016 standard premium of $118.80 per month. After the addition of the $3 per
month surcharge addedmonth surcharge added by BBAby BBA 15, total 2016 standard premiums were $121.80 per month. CMS, “15, total 2016 standard premiums were $121.80 per month. CMS, “ Medicare Program: Medicare Program:
Medicare Part B Monthly Actuarial Rates, Premium Rate, and Annual DeductibleMedicare Part B Monthly Actuarial Rates, Premium Rate, and Annual Deductible ~~Beginning~~ Beginning January 1, 2016,” 80 January 1, 2016,” 80
Federal Register 70811, November 16, 2015. 70811, November 16, 2015.
~~184~~ 187 For example, for an average retired worker with a benefit of $1,370 per month, a 0.3% increase would For example, for an average retired worker with a benefit of $1,370 per month, a 0.3% increase would have been have been
about $4.00. about $4.00. ~~T hat~~That person, therefore, would have seen a $4.00 increase in his or her Medicare person, therefore, would have seen a $4.00 increase in his or her Medicare Part B premiumPart B premium —from —from
$104.90 in 2016 to about $109.00 in 2017. Someone with a $6.00 Social Security benefit $104.90 in 2016 to about $109.00 in 2017. Someone with a $6.00 Social Security benefit ~~incr ease~~increase, by contrast, by contrast , would , would
have seen a $6.00 increase in his or her 2017 premium (for a total premium of about $111.00).have seen a $6.00 increase in his or her 2017 premium (for a total premium of about $111.00).
~~185 T he~~ 188 The distribution of the types of enrollees not held harmless in 2017 was distribution of the types of enrollees not held harmless in 2017 was similar to that in 2016. similar to that in 2016.
~~186~~189 Boards of Boards of ~~T rustees~~Trustees, Federal , Federal ~~Hospit al~~Hospital Insurance and Federal Insurance and Federal Supplementary MedicalSupplementary Medical ~~Insurance T rust Funds,~~ Insurance Trust Funds, 2016
Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal ~~Supplem entary~~Supplementary Medical
Insurance Trust Funds, June, June 22, 2016, 22, 2016, ~~T able~~Table V.E2, at https://www.cms.gov/Research-Statistics-Data-and-Systems/ V.E2, at https://www.cms.gov/Research-Statistics-Data-and-Systems/
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setting the 2017 premiums, the Secretary “exercised her statutory authority to mitigate projected setting the 2017 premiums, the Secretary “exercised her statutory authority to mitigate projected
premium increases for these beneficiaries”premium increases for these beneficiaries”~~187~~190 by setting a lower-than-normal contingency reserve by setting a lower-than-normal contingency reserve
ratio for the SMI Trust Fund in 2017. This had the effect of reducing premiums below what they ratio for the SMI Trust Fund in 2017. This had the effect of reducing premiums below what they
might have been had the ratio been set at a more conventional level.might have been had the ratio been set at a more conventional level.~~188~~191 In 2017, those not held In 2017, those not held
harmless paid monthly premiums of $134.00.harmless paid monthly premiums of $134.00.
Application of the Hold-Harmless Rule in 2018
In 2018, there was a 2.0% Social Security COLA and no increase in the 2018 Medicare Part B In 2018, there was a 2.0% Social Security COLA and no increase in the 2018 Medicare Part B
premiums (i.e., the Part B premium was $134.00 per month in both 2017 and 2018).premiums (i.e., the Part B premium was $134.00 per month in both 2017 and 2018).~~189~~192 For many For many
Part B enrollees who were held harmless in 2017, the Social Security COLA was large enough to Part B enrollees who were held harmless in 2017, the Social Security COLA was large enough to
cover the difference between the full Medicare premium of $134.00 and the reduced premium cover the difference between the full Medicare premium of $134.00 and the reduced premium
amount they paid in 2017. Therefore, many of those held harmless in 2017 no longer saw reduced amount they paid in 2017. Therefore, many of those held harmless in 2017 no longer saw reduced
premiums in 2018 and returned to paying the standard premium amounts (which include the premiums in 2018 and returned to paying the standard premium amounts (which include the
$3.00 BBA$3.00 BBA 15 surcharge). 15 surcharge).
To To ~~il ustrate~~illustrate, for someone receiving a Social Security benefit of $1,404.00 per month in 2017 (the , for someone receiving a Social Security benefit of $1,404.00 per month in 2017 (the
average amount for retired workers in that year),average amount for retired workers in that year),~~190~~193 a 2.0% Social Security COLA would have a 2.0% Social Security COLA would have
resulted in an increased benefit of about $28.00 per month in 2018. If that person had been held resulted in an increased benefit of about $28.00 per month in 2018. If that person had been held
harmless in 2017 and was paying a Medicare Part B premium of $109.00 per month, this Social harmless in 2017 and was paying a Medicare Part B premium of $109.00 per month, this Social
Security benefit increase would have been more than enough to cover the $25.00 difference Security benefit increase would have been more than enough to cover the $25.00 difference
between that individual’s reduced Part B 2017 premium amount of $109.00 and the 2018 between that individual’s reduced Part B 2017 premium amount of $109.00 and the 2018
premium of $134.00. Therefore, that person’s Medicare Part B premiums could have increased up premium of $134.00. Therefore, that person’s Medicare Part B premiums could have increased up
to the full premium amount of $134.00 in 2018.to the full premium amount of $134.00 in 2018.
CMS estimated that about 72% of Part B enrollees were not held harmless in 2018. CMS estimated that about 72% of Part B enrollees were not held harmless in 2018.~~191~~194 About 42% About 42%
of enrollees were held harmless in 2017 but no longer qualifiedof enrollees were held harmless in 2017 but no longer qualified for reduced premiums in 2018 for reduced premiums in 2018
because they did not meet the requirement that their Social Security benefits would decrease as a because they did not meet the requirement that their Social Security benefits would decrease as a
result of the increase in their Part B premiums. The remaining 30% included those who result of the increase in their Part B premiums. The remaining 30% included those who ~~normal y~~normally
do not qualify to be held harmless, for instance, because they paid high-income premiums, had do not qualify to be held harmless, for instance, because they paid high-income premiums, had
their premiums paid on their behalf by Medicaid, or did not receive Social Security benefits. their premiums paid on their behalf by Medicaid, or did not receive Social Security benefits.
About 28% of Part B enrollees did not receive a large enough increase in their Social Security About 28% of Part B enrollees did not receive a large enough increase in their Social Security
COLAs to cover the full amount of the Part B premium and thus qualified to be held harmless and COLAs to cover the full amount of the Part B premium and thus qualified to be held harmless and
paid reduced premiums in 2018. Their premiums could have increased from the premium amount paid reduced premiums in 2018. Their premiums could have increased from the premium amount
they paid in 2017, plus the dollar amount of the increase in their monthly 2018 Social Security they paid in 2017, plus the dollar amount of the increase in their monthly 2018 Social Security
benefit. For example, for someone with a monthly Social Security benefit of $600.00 in 2017, the benefit. For example, for someone with a monthly Social Security benefit of $600.00 in 2017, the
2.0% 2018 COLA would have provided an increase of about $12.00. If that individual had been 2.0% 2018 COLA would have provided an increase of about $12.00. If that individual had been
paying $109.00 per month for Medicare premiums in 2017, the $12.00 increase would not have paying $109.00 per month for Medicare premiums in 2017, the $12.00 increase would not have

~~Statistics-T rends~~ Statistics-Trends-and-Reports/ReportsTrustFunds/index.html. -and-Reports/ReportsTrustFunds/index.html.
~~187~~190 CMS, CMS, “ “2017 Medicare Parts A & B Premiums and Deductibles2017 Medicare Parts A & B Premiums and Deductibles Announced,” press release, November 10, 2016, at Announced,” press release, November 10, 2016, at
https://www.cms.gov/newsroom/press-releases/2017-medicare-parts-b-premiums-and-deductibles-announced. https://www.cms.gov/newsroom/press-releases/2017-medicare-parts-b-premiums-and-deductibles-announced.
~~188~~ 191 Contingency reserve ratios are normally set at an amount between 15% and 20% of end-of-year assets compared Contingency reserve ratios are normally set at an amount between 15% and 20% of end-of-year assets compared
with the following year’s expenditures, with a usualwith the following year’s expenditures, with a usual target of 17%. In 2017, the reserve ratiotarget of 17%. In 2017, the reserve ratio was set at 13%. was set at 13%.
~~189~~192 SSA, SSA, “ “Social Security Announces 2.0 Percent Benefit Increase for 2018Social Security Announces 2.0 Percent Benefit Increase for 2018 ,” press release, October 13, 2017, at ,” press release, October 13, 2017, at
https://www.ssa.gov/news/press/releases/2017/#10-2017-1; 2018 Medicare https://www.ssa.gov/news/press/releases/2017/#10-2017-1; 2018 Medicare ~~T rustees~~Trustees Report, Report, ~~T able~~Table V.E2. V.E2.
~~190~~193 SSA, SSA, Fast Facts & Figures About Social Security, 2018, p. 16,, p. 16, at https://www.ssa.gov/policy/docs/chartbooks/at https://www.ssa.gov/policy/docs/chartbooks/
fast_facts/2018/fast_facts18.pdf. fast_facts/2018/fast_facts18.pdf.
~~191~~ 194 CMS, CMS, “2018 Medicare Parts A & B Premiums and Deductibles,”“2018 Medicare Parts A & B Premiums and Deductibles,” fact sheet, November 17, 2017, at fact sheet, November 17, 2017, at
https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheethttps://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheet -items/2017-11-17.html. -items/2017-11-17.html.
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been sufficient to cover the full $134.00 per month. In this example, the individual been sufficient to cover the full $134.00 per month. In this example, the individual would have would have
paid $109.00 plus $12.00 ($121.00) per month in 2018. paid $109.00 plus $12.00 ($121.00) per month in 2018.
Application of the Hold-Harmless Rule ~~in 2019 and 2020~~2019 Through 2021
The 2019 Social Security COLA of 2.8% was large enough to increase the benefits of most of The 2019 Social Security COLA of 2.8% was large enough to increase the benefits of most of
those who were held harmless in 2018 to levels sufficient to cover the difference between the those who were held harmless in 2018 to levels sufficient to cover the difference between the
amount of the (reduced) premiums they paid in 2018 and the 2019 premiums of $135.50. In 2019, amount of the (reduced) premiums they paid in 2018 and the 2019 premiums of $135.50. In 2019,
only about 3.5% of beneficiaries (about 2 only about 3.5% of beneficiaries (about 2 ~~mil ion)~~ million) were held harmless and paid premiums lower were held harmless and paid premiums lower
than the 2019 premium of $135.50. than the 2019 premium of $135.50.
Similarly, Similarly, the 2020 Social Security COLA of 1.6%, was, on average, large enough to cover the the 2020 Social Security COLA of 1.6%, was, on average, large enough to cover the
full Part B premium increase of $9.10 (from $135.50 in 2019 to $144.60 in 2020) for most full Part B premium increase of $9.10 (from $135.50 in 2019 to $144.60 in 2020) for most
beneficiaries. However, the 2020 Social Security COLAbeneficiaries. However, the 2020 Social Security COLA’s was not sufficient to fully cover the was not sufficient to fully cover the
premium increase for about 3% of Part B enrollees (about 1.7 premium increase for about 3% of Part B enrollees (about 1.7 ~~mil ion),192~~million),195 and those individuals and those individuals
paid monthly premiums of less than $144.60 in 2020. paid monthly premiums of less than $144.60 in 2020.
~~For information on 2021 and potential~~In 2021, the growth in Medicare premiums was limited by the Continuing Appropriations Act, 2021, and Other Extensions Act (P.L. 116-159); therefore, the 1.3% Social Security COLA for 2021 was large enough to cover the full $3.90 increase in Part B premiums (from $144.60 to $148.50 per month) for most beneficiaries, and only 2% (about 1.2 million) were held harmless in 2021.196 For information on 2022 hold-harmless rule impacts, see “Protection of Social 2022 hold-harmless rule impacts, see “Protection of Social
Security Benefits from Increases in Medicare Part B PremiumsSecurity Benefits from Increases in Medicare Part B Premiums.”

~~192 Figures provided to CRS by SSA, February 2020.~~
~~Congressional Research Service~~

50” in this report. 195 Figures provided to CRS by SSA, February 2020. 196 Figures provided to CRS by CMS, May 2021. The average monthly Social Security payment for retirees in December 2020 prior to the application of the 2021 COLA was $1,544. At this payment level, a 1.3% COLA resulted in an increase of $20 per month, which more than covered the $3.90 Part B premium increase. SSA, Social Security Basic Facts, as of December 2020. Congressional Research Service 52

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Appendix F. Part A Premiums
The vast majority of persons turning the age of 65 are The vast majority of persons turning the age of 65 are ~~automatical y~~automatically entitled to Medicare Part A entitled to Medicare Part A
based on their own or their spouse’s work in covered employment. However, individuals aged 65 based on their own or their spouse’s work in covered employment. However, individuals aged 65
and older who are not otherwise eligible for Medicare Part A benefits and certain disabled and older who are not otherwise eligible for Medicare Part A benefits and certain disabled
individualsindividuals who have exhausted other entitlement may voluntarily purchase Part A coverage.who have exhausted other entitlement may voluntarily purchase Part A coverage.~~193~~197 In In
most cases, persons who voluntarily purchase Part A must also purchase Part B. The periods most cases, persons who voluntarily purchase Part A must also purchase Part B. The periods
during which one can enroll are the same as those for Part B (see during which one can enroll are the same as those for Part B (see “Medicare Part B Eligibility and
Enrollment”)). .
The monthly Part A premium is equal to the full average per capita value of the Part A benefit The monthly Part A premium is equal to the full average per capita value of the Part A benefit
~~($471~~($499.00 per month in .00 per month in ~~2021~~2022). Persons who have at least 30 quarters of covered employment (or ). Persons who have at least 30 quarters of covered employment (or
are married to someone who has such coverage) pay a premium that is 45% less than the full Part are married to someone who has such coverage) pay a premium that is 45% less than the full Part
A premium ($A premium ($~~259~~274.00 per month in .00 per month in ~~2021).194~~2022).198 CMS estimates that in CMS estimates that in ~~2021~~2022, about , about ~~706~~721,000 ,000
individualsindividuals ~~wil~~ will voluntarily enroll in Part A by paying the full premium. (About 90% of those voluntarily enroll in Part A by paying the full premium. (About 90% of those
subject to the full premium amount are enrolled in the QMB program, and their Part A premiums subject to the full premium amount are enrolled in the QMB program, and their Part A premiums
are paid for by Medicaidare paid for by Medicaid)..) CMS also estimates that about CMS also estimates that about 8487,000 enrollees ,000 enrollees ~~wil~~ will pay the reduced pay the reduced
premium.premium.~~195~~
199 Similar to Part B, a penalty is imposed for persons who delay Part A enrollment beyond their Similar to Part B, a penalty is imposed for persons who delay Part A enrollment beyond their
~~initial~~ initial enrollment period (which is the same seven-month period applicable for enrollment in Part enrollment period (which is the same seven-month period applicable for enrollment in Part
B).B).~~196~~200 However, both the amount of the penalty and the duration of the penalty are different than However, both the amount of the penalty and the duration of the penalty are different than
under Part B. Persons who delay Part A enrollment for at least 12 months beyond their initial under Part B. Persons who delay Part A enrollment for at least 12 months beyond their initial
enrollment period are subject to a 10% premium surcharge.enrollment period are subject to a 10% premium surcharge.~~197~~201 The surcharge is 10% regardless of The surcharge is 10% regardless of
the length of the delay. Further the surcharge only applies for a period equal to twice the number the length of the delay. Further the surcharge only applies for a period equal to twice the number
of years (i.e., 12-month periods) during which an individual delays enrollment. Thus, an of years (i.e., 12-month periods) during which an individual delays enrollment. Thus, an
individualindividual who delays enrollment for three years under Part A would be subject to a 10% penalty who delays enrollment for three years under Part A would be subject to a 10% penalty
for six years, whereas a person who delays enrollment for the same three-year period under Part for six years, whereas a person who delays enrollment for the same three-year period under Part
B would be subject to a permanent 30% penalty.B would be subject to a permanent 30% penalty.~~198~~

~~193 An individual eligible~~ 202 197 An individual eligible to enroll must be a resident of the United States. Further, the individualto enroll must be a resident of the United States. Further, the individual must either be a must either be a
citizen or an alien lawfullycitizen or an alien lawfully admitted for permanent residence who has residedadmitted for permanent residence who has resided in the United States continuously for the in the United States continuously for the
immediately preceding five years. immediately preceding five years. ~~T he~~The Social Security Act Social Security Act , §1818A provides for voluntary enrollment in Medicare Part , §1818A provides for voluntary enrollment in Medicare Part
A for certain disabledA for certain disabled ~~individuals who~~ individuals who were entitled to coverage duewere entitled to coverage due to their receipt of disability benefits, butto their receipt of disability benefits, but who have who have
lost those benefits becauselost those benefits because they have returned to work andthey have returned to work and their incomes exceed the level of “their incomes exceed the level of “ substantial gainful substantial gainful
activity.” For additional information on Part A benefits for the disabledactivity.” For additional information on Part A benefits for the disabled returning to work, see Socialreturning to work, see Social Security, Security,
“Working While Disabled“Working While Disabled: How We Can Help,” at https://www.ssa.gov/pubs/EN-05-10095.pdf. 198 The~~,” at http://www.socialsecurity.gov/pubs/10095.html.~~
~~194 T he~~ hold-harmless provision does not apply to Part A premiums. hold-harmless provision does not apply to Part A premiums.
~~195~~199 “Medicare Program; CY “Medicare Program; CY ~~2021~~2022 Part A Premiums for the Uninsured Aged Part A Premiums for the Uninsured Aged and for Certain Disabledand for Certain Disabled ~~Individuals~~ Individuals Who Who
Have Exhausted Other Entitlement,” Have Exhausted Other Entitlement,” 8586 Federal Register ~~71913~~64214, November , November ~~12, 2020~~17, 2021, at https://www.govinfo.gov/, at https://www.govinfo.gov/
content/pkg/FR-content/pkg/FR-~~2020-11-12/pdf/2020-25028.pdf.~~
~~196 T he~~2021-11-17/pdf/2021-25052.pdf. 200 The Consolidated Appropriations Act of 2001 (P.L. 106-554) exempts certain state and local retirees, retiring prior Consolidated Appropriations Act of 2001 (P.L. 106-554) exempts certain state and local retirees, retiring prior
to January 1, 2002, from the Part A late-enrollment penalty. to January 1, 2002, from the Part A late-enrollment penalty. ~~T hese~~These are groups of persons for whom the state or local are groups of persons for whom the state or local
government elects to pay the Part A late-enrollment penalty for life. government elects to pay the Part A late-enrollment penalty for life. ~~T he~~The amount of the penalty amount of the penalty , which would, which would otherwise otherwise
be assessedbe assessed is is to be reducedto be reduced by an amount equal to the total amount of Medicare payroll taxes paid by the employee by an amount equal to the total amount of Medicare payroll taxes paid by the employee
and the employer on behalf of the employee. and the employer on behalf of the employee. ~~T he~~The provision applies to premiums beginning January 2002. provision applies to premiums beginning January 2002.
~~197~~201 Similar Similar to Part B, if one qualifiesto Part B, if one qualifies for and signsfor and signs up duringup during a special enrollment period (e.g., within eight months of a special enrollment period (e.g., within eight months of
retiring, one may not be subject to a penaltyretiring, one may not be subject to a penalty ). ).
~~198~~202 Prior to enactment of COBRA (P.L. 99-272), there was no upper limit on the amount of the Part A surcharge or Prior to enactment of COBRA (P.L. 99-272), there was no upper limit on the amount of the Part A surcharge or
duration of the surcharge. COBRAduration of the surcharge. COBRA limited the amount of the Part A surcharge to 10% and the duration to twice the limited the amount of the Part A surcharge to 10% and the duration to twice the
period of delayedperiod of delayed enrollment. Introduced in the enrollment. Introduced in the ~~117 th~~117th Congress, Congress, ~~t he~~the Medicare Economic Security Solutions Act Medicare Economic Security Solutions Act , H.R. , H.R.
480, would480, would change the Part B penalty parameters to more closely align with the Part A penalties by capping the change the Part B penalty parameters to more closely align with the Part A penalties by capping the
surchargesurcharge to 15% of the Part B premium and limiting the duration of the penalty to twice the period of nonenrollment. to 15% of the Part B premium and limiting the duration of the penalty to twice the period of nonenrollment.
Congressional Research Service Congressional Research Service

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Medicare Part B: Enrollment and Premiums

Author Information

Patricia A. Davis Patricia A. Davis

Specialist in Health Care Financing Specialist in Health Care Financing

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