Medicare Premiums, Deductibles, and Copays Change for 2023

Here are the Medicare premiums, deductibles, and copay amounts for 2023.

Medicare Part A Costs and Deductible

Part A premiums. Most people don't pay a monthly premium for Medicare Part A (hospital insurance). But if you have to pay for Part A because you or your spouse don't have a long enough work history, you'll pay between $278 (if you have 30-39 work credits) and $506 (if you have fewer than 30 work credits).

Part A deductible. In 2023, you'll also pay a $1,600 deductible for each benefit period in which you use hospital or skilled nursing inpatient care.

Part A copayments. The first 60 days in the hospital, and the first 20 days in a skilled nursing facility, are included with your Part A deductible. After that, you'll have to pay the following copays.

• Hospital days 61-90: $400 coinsurance per day of each benefit period
• Hospital days 91 and beyond: $800 coinsurance per each lifetime reserve day for each benefit period
• Skilled nursing days 21-100: $200 coinsurance per day of each benefit period.

Medicare Part B Premiums and Deductible

Part B premiums. The standard Medicare Part B premium is actually decreasing by $5.20 per month in 2023, to $164.90. But about 7% of Medicare beneficiaries have to pay a higher monthly premium because their income is over a certain amount.

If your 2021 adjusted gross income was over $97,000 (or $194,000 for a couple), your monthly premiums in 2023 are as follows:

Part B deductible. The Part B deductible for 2023 also decreased, to $226 per year.

Limits on therapy. Medicare no longer puts a cap on the number of outpatient physical therapy, speech-language pathology, or occupational therapy visits it will pay for, but there are still thresholds for "authorization purposes," as follows:

• outpatient physical therapy and speech-language pathology combined: $2,230
• occupational therapy: $2,230.

If your therapist tells Medicare that therapy above the threshold is medically necessary and Medicare approves, you can go over the threshold.

Medicare Part C Costs

Beneficiaries of Part C, also called Medicare Advantage, have to pay the Part B premium as well as a monthly Advantage plan premium, although a good number of Advantage plans don't charge a monthly premium, and they generally have lower costs than traditional Medicare plans.

The average monthly premium for Medicare Advantage plans in 2023 has decreased to $18.

Medicare Part D Premiums and Deductible

Part D premiums. Part D premiums vary depending on the plan you choose, with an average of $31.50. Also, if your adjusted gross income is over $97,000 (or $194,000 for a couple), you'll pay a monthly adjustment amount to Medicare in addition to your monthly Part D premium.

Here are the Part D additional amounts for individuals making over $97,000 and married couples making over $194,000:

Part D deductible. The maximum Part D deductible for 2023 is $505 per year (though some plans waive the deductible completely).

Donut hole coverage. You no longer have to pay the full amount of your drug costs while in the "donut hole" (formerly called the "coverage gap"). Once your total yearly drug expense reaches $4,660 (and until your total out-of-pocket costs reach $7,400), you'll pay no more than 25% of your drug costs for both brand-name and generic drugs.

When you're on the other side of the donut hole (once you've reached $7,400 in medication costs), you pay only 5% of the cost of the drugs, or $4.15 for generics and preferred drugs and $10.35 for brand-name drugs, whichever is greater.

Note that you don't have to spend $4,660 in copayments before you get to the donut hole. The amount of your medication expenses that apply to the donut hole threshold depends on whether you've mostly spent money on brand-name drugs or generic drugs. While only your copay for generic drugs (the 25%) counts toward the $4,660 threshold, 95% of the cost of brand-name drugs (your copay and most of the insurance company's cost of the drug) counts toward the donut hole threshold.

The federal government offers subsidies to pay for Part D for those with low income (called Extra Help). See Nolo's article on Extra Help for Part D for more information.

Effective date: Jan 01, 2023