On November 8, the Centers for Medicare and Medicaid Services announced Medicare premiums and costs for 2025. Let’s take a quick look at what you need to know.

Part B Premium and deductible

The The 2025 premium for Part B, medical insurance, will be $185an increase of $10.30 (5.9%). CMS attributes the increase to “projected price changes and assumed utilization increases that are consistent with historical experience.”

Many retirees were concerned about the first Part B because Social Security’s cost-of-living adjustment, known as COLA, for 2025 is only 2.5%. But the Part B premium increases by 5.9%, so there are questions about the application of the hold harmless provision. This provision prevents the reduction of the beneficiary’s social security benefits because of an increase in the premium for Part B.

You may remember that, in 2016, there was no COLA; however, the The premium for Part B increased by $16.90 up to $121.80. Almost 70% of Part B beneficiaries were protected by provision and paid the 2015 premium ($104.90) all 12 months.

It is not likely to happen this time for two reasons. One, in 2016, CMS wrote in the third paragraph of the fact sheet that there was no question that the hold harmless provision would apply. CMS does not mention the provision in the recent update. Second, the Part B premium increases by $10 per month, but COLA will add about $50 to the monthly benefit for single recipients and $75 for couples. Very few Social Security recipients would need protection because the increase in monthly retirement benefits would cover the increased Part B premium.

Irma

Income-Related Monthly Adjustment Amounts (IRMAAs) are linked to your Part B premium so they will also increase in 2025.

• The threshold for single and married individuals filing separately is $106,000, up from $103,000, and for married individuals filing jointly, $212,000, up from $206,000.
• This year, monthly adjustments for Part D prescription drug coverage range from $12.90 to $81, and next year, it will be $13.70 to $85.80.
• The thresholds for full Part B coverage (which apply to most people covered by the IRMAA) are the same as for Part D. However, the CMS fact sheet did not include the table of adjustments for full Part B, an interesting and unexpected omission. I have reached out to CMS and will update this post if I hear back or when the numbers are available

I have often been asked by married people subject to the higher levels of IRMAA if filing separately would reduce the amount they pay. I show them the tables and they quickly realize that they would be paying a lot more because there are only two tiers for separate filers. In 2024, they are $130,000-$397,000 and above $397,000. The corresponding adjustments are $377.70 and $412.20. (A single or joint filer over the $103,000 threshold pays $69.90.) Adjustments for future years will undoubtedly be higher.

Medicare is essential, so people have to pay the premiums. But unfortunately, in today’s world, rising costs are a reality. I’m hoping for the smallest, but budget for more.