Govind Tekale
The Centers for Medicare and Medicaid Services (CMS) has announced Medicare Part B premium increases for 2025, continuing a pattern of healthcare cost escalation that outpaces Social Security benefit adjustments. Monthly premiums will increase by $10.30 to $185.00, up from $174.70 in 2024, while the annual deductible rises by $17 to $257.
This 5.9% premium increase exceeds both the 2.5% Social Security cost-of-living adjustment (COLA) and October’s 3.2% inflation rate, creating financial pressure for Medicare beneficiaries. The average Social Security recipient will receive approximately $50 more per month in 2025, which, while sufficient to cover the premium increase, leaves less for other expenses.
“When Part B premiums grow at a faster rate than Social Security COLAS, premium costs consume a growing portion of monthly Social Security checks,” explains Mary Johnson, an independent Social Security and Medicare policy analyst who receives these benefits herself at age 73.
Past Trends
Analysis of Medicare cost trends from 2005 to 2024 reveals Part B premiums increased by an average of 5.5% annually, while Social Security COLAs averaged just 2.6%. Johnson’s research indicates only four years without premium increases during this period: 2009, 2014, and 2015 under President Obama’s administration, and 2018 under President Trump’s administration.
Income-Based Premium Adjustments
For higher-income beneficiaries, additional costs apply through the Income-Related Monthly Adjustment Amount (IRMAA), affecting approximately 8% of Medicare Part B enrollees. CMS has established the following premium structure for married beneficiaries filing separate tax returns:
- $185.00 monthly for modified adjusted gross income of $106,000 or less
- $591.90 monthly ($406.90 IRMAA plus $185.00 standard) for incomes between $106,000 and $394,000
- $628.90 monthly ($443.90 IRMAA plus $185.00 standard) for incomes above $394,000
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Other Medicare Cost Changes
Part A, which covers inpatient hospital stays and skilled nursing facilities, will see its deductible increase by $44 to $1,676 in 2025. The small percentage of beneficiaries who pay Part A premiums will face a $13 increase to $518 monthly.
Implementation Timeline
Social Security beneficiaries will see the new Part B premium automatically deducted from their January 2025 checks. Those paying Medicare premiums directly must adjust their payments to the new amount starting January 2025.
Impact on Vulnerable Populations
The premium increases disproportionately affect low-income seniors and those with chronic health conditions who require consistent medical care. While the new $2,000 out-of-pocket cap for Part D prescriptions offers some cost protection, healthcare advocacy groups express concern about the cumulative effect of rising costs on fixed-income seniors.
CMS attributes these increases to “projected price changes and assumed utilization increases that are consistent with historical experience.” The agency’s data indicates nearly all Medicare beneficiaries (99%) receive premium-free Part A coverage based on their work history.
