Earlier this month, the Centers for Medicare and Medicaid Services (CMS) released updates for the 2024 Medicare premiums, deductible, and cost-sharing amounts for Part A and Part B. They also released updated amounts for IRMAA, the Income-Related Monthly Adjustment Amount, which applies to individuals with high incomes.
2024 Medicare Part A Updates
Part A covers inpatient costs for hospitals and skilled nursing facilities.
Medicare Part A has always been premium-free for most beneficiaries. You won’t have to pay the Part A premium as long as you’ve earned enough credits – by paying taxes for 40 quarters. This also applies if you haven’t met the requirement but are married to someone who has. About 99% of all enrollees meet this requirement.
Beneficiaries who don’t have the minimum 40 credits can still enroll in Part A as long as they’re willing to pay the monthly premium, which will be based on how many quarters they’ve paid taxes. In 2024, those amounts are as follows:
- At least 30 quarters: $278 / month
- Less than 30 quarters: $505 / month
These numbers aren’t much different than they were in 2023. The reduced rate of $278 stayed the same, and the maximum premium of $505 was a $1 decrease.
Part A also has a deductible, which runs on a benefit period. A benefit period begins on the first day you become an inpatient and ends when you’ve been hospital-free for 60 consecutive days. The 2024 Part A deductible is set at $1,632, an increase of $32 from 2023.
Part A covers your first 60 days of a hospital stay, and your cost-sharing responsibility begins on day 61. Day 61 through day 90 will cost you $408 per day, an $8 increase from 2023. Starting on day 91, you can use any of your 60 lifetime reserve days. Using one of those will cost $816 per day, a $16 increase from 2023.
Skilled nursing facilities have different coinsurance costs. Part A will cover the first 20 days, and then days 21 through day 100 will cost beneficiaries $204 per day, a $4 increase from 2023.
2024 Medicare Part B Updates
Medicare Part B covers outpatient services such as doctor visits, surgeries, lab tests, diagnostic imaging, durable medical equipment, preventive services, and more.
Unlike Part A, Medicare Part B does have a standard premium that almost all beneficiaries must pay. In 2024, the standard premium for Part B will be $174.70, which is an increase of $9.80 from 2023. The annual deductible also increases to $240, up from $226 in 2023.
These increases are primarily due to projected healthcare costs and spending.
Individuals whose Medicare coverage ended three years after a kidney transplant and who do not have other insurance coverage can also choose to continue their enrollment in Medicare Part B for immunosuppressive drugs. The 2024 premium for this option will be $103 per month.
Rates have also changed for the Part B IRMAA. As we mentioned earlier, IRMAA stands for the Income-Related Monthly Adjustment Amount. Individuals and couples who earn higher incomes are subject to IRMAA, which increases the amount they’ll pay for Part B and Part D. IRMAA impacts about 8% of the population.
IRMAA is calculated based on your adjusted gross income from two years prior. So, for 2024, your Part B premium will be based on your income from 2022. It will also depend on whether you file your taxes as a single person or a married couple.
The 2024 Part B IRMAA amounts are shown in the table below.
2024 Medicare Part D Updates
Medicare Part D offers prescription drug coverage to beneficiaries. There is not a standard premium for Part D, nor is there just one plan to choose from. Instead, you’ll compare your medication list to plans offered in your area to find the plan that best fits your needs. Part D premiums will also vary.
IRMAA also applies to Part D plans, though the added amount is not as much as it is for Part B. Below is a table with Part D IRMAA. This amount will be added to your Part D premium. However, IRMAA is paid to Medicare, not the private insurance carrier that holds your Part D plan.
The standard Part D deductible is set at $545 for 2024, up from $505 this year. Insurance companies can choose to use this standard deductible or a lower amount.
In addition, the initial coverage limit will increase to $5,030 in 2024, up from $4,660 in 2023. Once you hit that amount, you’ll find yourself in the donut hole and will pay more for your prescriptions. Catastrophic coverage begins at $8,000 in 2024, up from $7,400 in 2023. Starting in 2024, you will not have any cost-sharing responsibility once you reach catastrophic coverage.