Question

In 2012, cost per Medicare beneficiary did what?

Answer 1

The normal monthly premium for Medicare Part B will be $99.90 in 2012, down $15.50 from the $115.40 premium in 2011. Most beneficiaries of Medicare, however, were kept harmless in 2011 and paid $96.40 a month. The premium for 2012 reflects an rise of $3.50.

Part B of Medicare includes a part of the price of physician services, ambulatory hospital services, certain home health facilities, sustainable medical equipment, and other products. By law, the standard premium is set to cover one-fourth of the average cost of Part B services to recipients aged 65 and over, plus a margin of contingency.

The contingency margin is an amount to ensure that Part B has sufficient assets and income to I cover expenditure in Part B during the year, (ii) cover expenditure incurred but unpaid claims at year-end, (iii) provide for possible variation between actual and projected expenditure and (iv) amortize any surplus assets. Federal overall revenue finances most of the remaining Part B expenses.

The biggest factor influencing the 2012 contingency margin is the present physician fee law formula, which will result in a payment decrease of about 29 percent in 2012. Congress has acted to avoid lower physician fee cuts from happening for every year from 2003 to 2011. It is almost certain that the 2012 decrease will be overridden by legislation implemented after Part B funding for 2012 has been set. In recognition of the powerful likelihood of Part B expenditure increases resulting from comparable laws to override the 2012 reduction in doctor charges, it is suitable to keep a much bigger Part B contingency reserve than would otherwise be necessary