COLA Increase 2024 Medicare
Medicare Part B Premium: In 2025, Medicare Part B beneficiaries will face an increase in their monthly premium, which will rise by $10.30 to $185.00, up from $174.70 in 2024. This is a significant jump from $164.90 in 2023. Additionally, the annual deductible for Part B will increase to $257, up from $240 in 2024. These increases are primarily attributed to rising healthcare costs and increased usage, as explained by the Centers for Medicare and Medicaid Services (CMS).
This increase surpasses both inflation, which rose 3.2% in October 2024, and the 2.5% cost-of-living adjustment (COLA) for Social Security benefits in 2025, which will provide an average $50 increase per month for beneficiaries. The rising Part B premiums highlight the growing financial challenges for seniors, especially as their benefits from COLA may not fully offset the rising costs for healthcare.
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“When Part B premiums grow at a faster rate than Social Security COLAS, premium costs consume a growing portion of monthly Social Security checks,” said Mary Johnson, an independent Social Security and Medicare policy analyst who at age 73, also receives those benefits.
High-income Americans additionally pay an Income-Related Monthly Adjustment Amount, or IRMAA, because their income determines their Part B monthly premium. According to CMS, about 8% of Medicare Part B beneficiaries are impacted by IRMAA.
“While mostSocial Security recipients aged 65 and older will have benefits high enough to cover the $10.30 per month increase of Part B premiums from $174.70 to $185.00, the same is not true of individuals who pay higher premiums based on income,” Johnson said.
According to CMS, beneficiaries who file separate tax returns from their spouses but are married and reside with them at any point throughout the year and have modified adjusted gross incomes of:
For years, Medicare Part B expenses have exceeded COLA.
2025 is not an anomaly. According to research, Medicare Part B rates have been increasing more quickly than COLA for years, which contributes to the financial difficulties faced by many seniors.
The fact that Medicare Part B expenses have surpassed COLA in 2025 is not an anomaly. According to USAToday, Medicare Part B rates have been increasing more quickly than COLA for years, which contributes to the financial difficulties faced by many seniors.
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“The disparity is caused in part because Medicare costs are not included in the consumer price index that’s currently used to calculate the COLA,” she said.
According to Johnson’s estimate, COLAs climbed by less than half that amount, at only 2.6% annually, between 2005 and 2024, although Part B premiums increased by an average of 5.5% annually.
Only four occasions during that period did Part B premiums not rise, she noted, three of which occurred under former President Barack Obama’s administration (2009, 2014, and 2015) and one under the administration of former President Donald Trump in 2018.
Nevertheless, Johnson noted that under each of the most recent presidential administrations—George W. Bush, Obama, Trump, and Joe Biden—there were still notable double-digit premium increases.
Seniors must begin paying the new Medicare Part B premium at what point?
The new 2025 Part B payment is typically immediately withheld from Social Security checks in January for those who currently receive benefits.
Beginning in January, those who already pay Medicare Part B each month and are not getting Social Security benefits must make sure they pay the new, higher amount.
Medicare is divided into several parts, and Part B covers services provided by doctors, outpatient hospitals, some home health services, durable medical equipment, and other health and medical services that Medicare Part A does not cover.
Hospice, skilled nursing facilities, inpatient rehabilitation, inpatient hospital stays, and certain home health care services are covered under Part A.
According to CMS, the Social Security Administration estimates that 99% of Medicare beneficiaries do not pay a Part A premium because they have worked for at least 40 quarters in a Medicare-covered job.
According to CMS, the Part A inpatient hospital deductible will increase by $44 from $1,632 in 2024 to $1,676 in 2025.
There will be a $13 increase in the full monthly Part A premium to $518 for those who haven’t worked long enough to be eligible for premium-free Part A.
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