Medicare in 2005: Increased costs for everyone
and a few new benefits that may help some

December 12, 2004, New York, NY– Upcoming changes in the Medicare program for 2005 mean increased out-of-pocket costs for older adults who are already struggling to safeguard their health as well as their wallets and a few new benefits that may help some people.

“The biggest change to the Medicare program next year—a 17 percent hike in the monthly premium—means older and disabled Americans will forgo food, heat and basic necessities to pay for their health care,” says Robert M. Hayes, president of the Medicare Rights Center.  “Consumers need to get savvier and savvier to make ends meet. We’ll be there to help. 

The consumer group compiled a list of four key changes in Medicare in the coming year.   

1.      Medicare Part B premium is increasing to $78.20.  The Part B premium increase is the largest in Medicare’s 40-year history.  If your income is less than $1,068/month (or $1,426 if you’re married), you may qualify for a Medicare Savings Program that helps pay for your Part B premiums, deductibles and coinsurance.  Contact your state Medicaid office for more information. 

2.      Medicare Part B deductible is increasing to $110.  The Part B deductible that you pay when you first use your Part B coverage each year will be $110, up $10 – the first Part B deductible increase since 1991.  Medicare Part B covers outpatient services such as doctors’ services, laboratory tests and hospital outpatient services. 

3.      Subsidy for prescription drugs.  People with low incomes ($12,569 for an individual and $16,862 for a couple in 2004 – it will be a bit higher in 2005) can get a $600 credit toward their prescription drugs in 2005 on a Medicare-approved drug discount card, if they do not have drug coverage from a current or former employer, Medicaid, the Federal Employee Health Benefits Program, or Tricare.  The credit is reduced by $150 for every three months enrollment is delayed.   (If you apply for a card by the end of 2004, you will get $600 credit in 2004, and another $600 again automatically in 2005.  Any credit left over from 2004 will carry over to 2005.)  To find out about Medicare-approved drug discount cards and other ways to save money on drugs in your area, call your State Health Insurance Assistance Program.  You can get their number from Medicare at 1-800-633-4227.

 4.      Preventive benefits.  New Medicare enrollees will be entitled to one physical examination in the first six months after enrolling in Part B.  The “Welcome to Medicare Physical” includes height, weight, and blood pressure measurements, an electrocardiogram, education and counseling.  Medicare is now covering blood tests to screen for cardiovascular disease, including tests for cholesterol, lipids and triglyceride levels.  For people at high-risk for diabetes, Medicare will cover laboratory tests to screen for the disease.  Talk to your doctor for more information.