Medicare Health Insurance Card

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Starting next year, retirees will spend less on monthly premiums for Medicare’s Part B plan — the first time there's been a decrease in a decade. The 3% decrease also affects the cost of routine doctors’ visits and other outpatient care, which are covered under Part B. President Biden made the announcement via Twitter.

The drop in premiums, which starts in 2023,  is much needed after this year's $21.60-a-month increase, the largest ever. Now, most people on Medicare will see savings of $5.20 a month, reducing the Part B monthly payment to $164.90.

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The main driving factor for the huge spike for 2022 was spending on the new drug for Alzheimer’s disease, Aduhelm, which is intravenously administered in doctors' offices. The manufacturer of the drug has now cut the medication's price nearly in half. The price drop combined with lower projected spending on other Part B items and services has resulted in larger reserves in the Part B trust fund, prompting the premium drop. 

The Inflation Reduction Act is also leading to savings for some Medicare users. Biden announced that out-of-pocket costs for drugs will now be limited to $2,000 a year, a huge break from what some seniors have been paying.

The Inflation Reduction Act also allows Medicare to negotiate the price of high-cost drugs and help diabetic seniors by capping monthly insulin copayments to $35 a month.

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