The Biden administration on Tuesday announced that Medicare Part B premiums will decrease in 2023, marking the first time this cost has been lowered in more than a decade.
The Centers for Medicare & Medicaid Services (CMS) announced that Medicare Part B premiums would be lowered by three percent, or $5.20, going from $170.10 a month to $164.90. The program’s annual deductible will also fall by $7, from $233 to $226.
The last time Medicare Part B premiums fell was in 2012 when they went from $115.40 to $99.90 a month, a decrease of 13.4 percent.
In 2022, Medicare Part B premiums rose by 14.5 percent, one of the largest annual increases ever seen in the program’s history. A major factor in this increase was the inclusion of Aduhelm, the first Alzheimer’s medication approved by the Food and Drug Administration in 20 years.
The drug was highly scrutinized due to questions regarding its efficacy in treating Alzheimer’s disease as well as its sky-high price. Aduhelm initially cost $56,000 before its manufacturer Biogen announced it was halving the price to $28,200.
News of this decrease does not come as a complete surprise, as Health and Human Services Secretary Xavier Becerra had said in May that the premiums in 2023 would be adjusted in light of a report that found the cost of including Aduhelm in Medicare had been overestimated. This report was ordered following Biogen’s decision to decrease the cost of Aduhelm.
Becerra said at the time that he had hoped to lower premiums during 2022, but found that there were “legal and operational hurdles” preventing this. With this announced decrease, the 2023 Medicare Part B premium will be 11 percent higher than the $148.50 monthly fee that was set in 2021.
CMS cited the “lower-than-projected spending on both Aduhelm and other Part B items” as reason for the “much larger reserves” in the Supplementary Medical Insurance (SMI) Trust Fund that allowed for the lowered premium.