Date: October 18, 2002
For Release: Immediately
Contact: CMS Press Office
(202) 690-6145
Headline: HHS ANNOUNCES
MEDICARE PREMIUM AND DEDUCTIBLE RATES FOR 2003
The Department of Health and Human Services (HHS) today announced
the Medicare premium, deductible and coinsurance amounts to be paid by Medicare
beneficiaries in 2003.
For Medicare Part A, which pays for inpatient hospital, skilled
nursing facility, and some home health care, the deductible paid by the beneficiary
will be $840 in 2003, up 3.5 percent from this year's $812 deductible. The monthly premium paid by beneficiaries enrolled
in Medicare Part B, which covers physician services, outpatient hospital services,
certain home health services, durable medical equipment and other items, will be
$58.70, an increase of 8.7 percent over the $54.00 premium for 2002.
"These legally required increases reinforce the need to
strengthen Medicare and give seniors and disabled Americans more and better insurance
options," HHS Secretary Tommy G. Thompson said. "Medicare beneficiaries often must face higher out-of-pocket expenses
than Americans enrolled in private health plans. President Bush's plan would give Medicare beneficiaries better options
to obtain prescription drugs and affordable health care."
Medicare law requires that the deductibles and premiums be updated
annually in accordance with statutory formulas. The law sets the Part B premium at the amount needed to cover 25 percent
of estimated program costs for aged enrollees. General revenue tax dollars cover the other 75 percent of the costs.
The same statute prescribes the method for
computing the Part A inpatient hospital deductible.
All Medicare beneficiaries enrolled in Part B pay the monthly
premium. The Part A deductible applies only
to those enrolled in the original fee-for-service Medicare program. Those who enroll in private Medicare+Choice plans
may not be affected by the Part A increase, and may receive additional benefits
with different cost-sharing arrangements.
Most of Medicare's 40.4 million beneficiaries are enrolled in
the optional Part B, which helps pay for physician services, hospital outpatient
care, durable medical equipment and other services, including some home health care.
Nearly 90 percent also have some form of
supplemental coverage (such as Medigap, Medicaid, or Medicare+Choice) to help reduce
out-of-pocket medical costs.
The Part A deductible is the beneficiary's only cost for up to
60 days of Medicare-covered inpatient hospital care. However, for extended Medicare-covered hospital stays, beneficiaries
must pay an additional $210 per day for days 61 through 90 in 2003, and $420 per
day for hospital stays beyond the 90th day in a benefit period. For 2002,
per day payment for days 61 through 90 was $203, and $406 for beyond 90 days. For beneficiaries in skilled nursing facilities,
the daily co-insurance for days 21 through 100 will be $105 in 2003, compared to
$101.50 in 2002.
Most Medicare beneficiaries do not pay a premium for Part A service.
Seniors and persons under age 65 with disabilities may obtain Part A coverage even
though they have fewer than 30 quarters of Medicare-covered employment, by paying
a monthly premium set according to a formula in the Medicare statute at $316 for
2003, a reduction of $3 from 2002. Seniors
and certain persons under age 65 with disabilities with 30 to 39 quarters of Medicare-covered
employment are entitled to pay a reduced monthly premium of $174. To be eligible for voluntary enrollment in Part
A based on disability, the person must have lost disability benefits solely because
earnings exceeded a certain amount.
States have programs that pay some or all of beneficiaries' premiums
and coinsurance for certain people who have Medicare and a low income. Information
is available at 1-800-MEDICARE (1-800-633-4227) and, for hearing and speech impaired,
at TTY/TDD: 1-877-486-2048.
Information concerning the Social Security Cost of Living increase
for 2003
was also released today and can be found at http://www.SSA.gov.
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Note: All HHS press releases, fact sheets and other press materials
are
available at www.hhs.gov/news.