The United States announced a huge increase in Medicare premiums

Experimental Alzheimer's medicine approved 1:32

(CNN) -

The federal government announced a large increase in Medicare premiums Friday night, blaming the pandemic but also what it called uncertainty about how much it might have to pay for a controversial and expensive new drug. Alzheimer's.

The 14.5% increase in Medicare Part B premiums will take monthly payments for those in the lowest income bracket from $ 148.50 a month this year to $ 170.10 in 2022.

Medicare Part B covers medical services, outpatient hospital services, certain home health services, medical equipment, and other medical and health services not covered by Medicare Part A, including drugs that are administered in medical offices.

• Social Security recipients get a 5.9% increase, but the price increase will offset the increase

The Centers for Medicare & Medicaid Services (CMS) downplayed the increase, noting that most beneficiaries also collect Social Security benefits and will see a cost-of-living adjustment of 5.9% on their payments. monthly in 2022, the agency said in a statement.

That is the biggest hit in 30 years.

"This significant increase in COLA [cost of living adjustment] will more than cover the increase in the monthly Medicare Part B premium," CMS said.

"Most people with Medicare will see a significant net increase in Social Security benefits. For example, a retired worker who currently receives $ 1,565 per month from Social Security can expect to receive a net increase of $ 70.40 per month. month after deducting Medicare Part B premium. "

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However, the increase is much larger than what Medicare trustees estimated in their annual report, which was released in late August.

They predicted that the monthly premium for 2022 would be $ 158.50.

The actual increase, the largest since 2016, could financially affect some older people.

"It will consume the entire annual cost-of-living adjustment (COLA) for Social Security recipients with the lowest benefits, approximately $ 365 per month," said Mary Johnson, policy analyst at Social Security. and Medicare for The Senior Citizens League, an advocacy agency group.

"Social Security recipients with higher benefits should be able to cover the $ 21.60 per month increase, but they may not end up with as much left over as they hoped."

Medicare premiums have generally increased at a much faster rate than Social Security's annual adjustments, the league said.

And much of the 2022 increase in Social Security benefits will be eaten up by inflation, which is also increasing at a rapid rate.

CMS said part of the increase for 2022 was due to uncertainty about how much the agency will end up paying to treat recipients who will be treated with Aduhelm, an Alzheimer's drug approved by the U.S. Food and Drug Administration. , for its acronym in English) in June despite the objections of his advisers.

Some experts estimate it will cost $ 56,000 a year.

Medicare is deciding whether to pay for it now, on a case-by-case basis.

Hope and controversy over a drug against Alzheimer's 1:18

Because Aduhelm is administered in doctor's offices, it must be covered by Medicare Part B, not Part D plans, which pay for drugs purchased at pharmacies. Traditional Medicare members have to pay 20% of the cost for most Part B drugs, which would translate to approximately $ 11,500 in out-of-pocket costs for those who were prescribed Aduhelm.

"The increase in the Part B premium by 2022 is continuing evidence that rising drug costs threaten the affordability and sustainability of the Medicare program," CMS Administrator Chiquita Brooks-LaSure said in a release.

"The Biden-Harris Administration is working to make drug prices more affordable and equitable for all Americans, and to promote drug price reform through competition, innovation and transparency."

• Democratic lawmakers in the US Senate reach an agreement on prescription drug prices

Also, last year, Congress capped the 2021 premium increase even as Medicare emergency spending increased during the coronavirus pandemic.

The monthly charge went up by less than $ 4.

Along with the increased premium, the annual deductible for Medicare Part B beneficiaries will increase to $ 233 in 2022, up from $ 203 in 2021.

Medicare is the federal health insurance plan that covers more than 62 million people, the majority 65 and older.

Part B premiums are based on income.

Individuals earning $ 500,000 or more per year and joint taxpayers earning $ 750,000 or more per year will pay $ 578.30 per month for coverage in 2022.