From barely registering to integral component
February 16, 2015, On Medicare, InvestmentNews.com
By Katy Votava
Fifty years ago today, both Medicare and the Grateful Dead got their start.
Today, all the surviving members of that famous San Francisco band are eligible for Medicare. It’s a fair bet that they , like most people in their age group in 1965, didn’t pay attention to the law that President Lyndon B. Johnson signed that year – let alone realize how integral the program would become to American culture.
One of the most dramatic changes in Medicare over the past five decades is the method used to set some of the biggest out-of-pocket costs for beneficiaries.
In the beginning, beneficiaries paid $60 a year for Part B coverage-an amount so small that people hardly noticed it coming out of their Social Security checks.
There was no such thing as a Part D plan in 1965.
Now, in addition to prescription drug coverage, certain Medicare out-of-pocket costs are adjusted based on income. The more people make, the more they pay-without getting any more benefits. This year, Medicare recipient (except those with very low income) pays between $1259 and $4878 for income-related Medicare Parts B and D charges. Going $1 into the next bracket will cost your clients hundreds or thousands of dollars more year over year. Conversely, going down $1 into the next bracket can save equally as much.
As Advisers know, paying for Medicare does not stop here. In addition to these income-related charges, people will pay Medicare co-payments, deductibles, Medicare D premiums and supplemental coverage premiums. Read more >