More than 2.4 million seniors in Florida rely on Medicare, and a good chunk of them could face rising health care premiums next year.
With Medicare's annual open enrollment period beginning Sunday, most of the changes to plans and services seem slight for 2018. But experts say Floridians will be among the millions affected nationwide by anticipated rising premiums for Part B plans, which cover outpatient care, doctor bills, physical therapy and more routine health services.
Part B is optional to enroll in and costs most people a monthly premium, which was on average around $134 in 2017, depending on the enrollee's income. However, participants paid around $109 a month if they chose to have the monthly fee deducted from their Social Security checks. These are the prices that will rise in 2018, analysts say.
Cost-of-living adjustments that are expected to slightly inflate Social Security payouts next year will likely be eaten up mostly by seniors' rising Part B premiums. Experts estimate that premiums paid through Social Security will likely be around $20-$30 more a month next year.
Most of the seniors affected by these rising costs have been shielded from cost increases for several years, said Troy Quast, a health care economist at the University of South Florida. And since there was no cost-of-living adjustment to Social Security in 2016, Part B monthly premiums didn't go up that year. The monthly price has remained flat for the last three years. But Social Security is due to get a 2.2 percent cost-of-living adjustment in October 2018.
"The exact health premiums haven't been set yet for 2018, but looking at the Social Security adjustments that are coming, it looks like seniors will have to pay for that gap, which will be rough," Quast said.
The "hold harmless provision," created to protect seniors living on fixed incomes, won't allow Medicare to raise Part B premiums if doing so would could reduce a person's Social Security benefits. But the looming cost-of-living adjustment allows room for the uptick in prices.
Part B premiums are projected to rise an average of 5.4 percent each year from now through 2024, which is faster than other parts of Medicare, according to the Kaiser Family Foundation.
Another Part B change will affect a smaller group of seniors, particularly those in higher income brackets, who pay a surcharge that increases their premiums. Due to federal legislation enacted in 2015, most of those brackets are being adjusted in a way that will put more people in the higher income tiers, increasing their premiums.
For example, the top tier, where people pay the highest surcharges, soon will be expanded to include individuals making more than $160,000. That's down from $214,000 currently. Similarly, the next tier down will start at $133,001 in individual income instead of the current $160,001.
"The wealthiest will see a bump in their premiums, for sure. We're talking about folks in the top income levels, so not too many people will affected, but prices are going up," said Anne Swerlick of the Florida Policy Institute.
Aside from premium increases, many seniors who rely on government-funded "navigator" programs during the enrollment period may have to look elsewhere for assistance.
In Florida and across the country, programs designed to help people find and enroll in a Medicare plan are at risk in 2018. Florida SHINE, which is a Medicare navigator through the Florida Department of Elder Affairs, is among the dozens of programs that could have its budget cut by the federal government by up to 90 percent. A Florida Senate committee budget from June aimed to eliminate all funding for the State Health Insurance Assistance Program, or SHIP, which funds programs like SHINE.
"These programs help elders navigate through what their options are, especially during the open enrollment periods," Swerlick said. "It can be quite complicated. Eliminating a program like SHINE will have a tremendous impact on the state of Florida, which has so many seniors enrolled in Medicare and who depend on this kind of assistance."
The good news is some prices will go down. Part D, which covers prescription drugs, will see a drop in prices for the first time in five years of $1.20. That will bring the premium to around $33.50 a month.
For the most part, though, it seems that most Medicare plans will remain close to the same — with some premiums going up and others going down, and some expanding coverage. However, any change could mean some doctors may no longer be part of the network, or certain prescription medications may become more expensive or not be covered at all. Enrollees are urged to research the options available for 2018 before electing for the same plan from years prior.
Contact Justine Griffin at [email protected] or (727) 893-8467. Follow @SunBizGriffin.
Medicare Open Enrollment 2018:
Oct. 15-Dec. 7, with a special extension to Dec. 31 for those affected by hurricanes Harvey, Irma or Maria.
Need help? Call the Florida Senior Hotline toll-free at 1-800-963-5337