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Medicare Part B Premium Projected to Rise Slightly in 2027, Then More Sharply in Coming Years
Aging population, higher medical and drug costs help fuel expected 5-year rise in Part B premiums. Trump announces 20.8 million to get one-time $90 payment this month to help pay Part B premiums.
10-minute read
Jon Krause
Key takeaways
- Part B covers doctor visits, preventive screenings and some drugs.
- Medicare’s standard Part B premium could top $209 in 2027.
- Most Part B premiums are deducted from Social Security checks.
- Medicare trustees: Part B premium could hit $272.10 in 2031.
- AARP is working to keep Medicare premiums, copayments down.
Medicare’s monthly Part B premium, which covers physician visits and outpatient hospital services, is expected to rise again in 2027 after topping $200 for the first time in 2026.
In its annual report, the Medicare Board of Trustees projects the standard monthly premium for Part B — which also covers diagnostic tests, preventive screenings and drugs administered by providers — will increase by $6.60 to $209.50 per month in 2027. Trustees expect the Part B deductible, the amount you pay before Medicare coverage kicks in, to go from $283 to $292 in 2027.
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The actual Part B premium and deductible for 2027 will be announced later this fall by the Centers for Medicare & Medicaid Services.
One month before the midterm elections, President Donald Trump announced that 20.8 million original Medicare beneficiaries will receive a one-time $90 rebate payment this month designed to help them pay their Part B premium. “My Administration will, immediately, begin sending 'Checks' of nearly $100 to over 20 MILLION wonderful Seniors to help pay for their Medicare Part B premiums,” Trump wrote in a late-night Oct. 2 post on Truth Social.
But the payments will cover less than half of one month’s standard Part B premium of $202.90 in 2026.
“This one-time payment may not go far at offsetting rising costs for health care and other everyday essentials,” says a blog post by Juliette Cubanski, vice president and director of the Program on Medicare Policy at KFF, a health care research organization.
Those eligible for the money must be enrolled in original Medicare, live in the U.S., and cannot receive premium assistance from Medicaid, CMS says. The estimated 36.1 million people enrolled in private Medicare Advantage plans issued by commercial insurers are ineligible for the rebate.
Most eligible recipients will receive the payment by direct deposit in their bank account from the Social Security Administration. Those without direct deposit will receive a check to their registered Medicare mailing address.
Funding for the payments will come from the Medicare Improvement Fund, which was established by Congress to make improvements to Part A and Part B in original Medicare. Cubanski says the $90 payments would nearly deplete the fund, which contained just over $2 billion.
Medicare enrollees can call 800-MEDICARE (800-633-4227) to check their eligibility for the rebate. Those who want information about the status of their payment should call the Social Security Administration at 1-800-772-1213.
In the past 10 years, the trustees’ Part B premium projections have been accurate three times. They were off by just 10 cents for 2024 and 30 cents for 2020.
If your modified adjusted gross income reported on your IRS tax return from 2 years ago is above a certain level, you’ll pay an income-related monthly adjustment amount (IRMAA) along with the standard Part B premium. Roughly 5.1 million beneficiaries did so in 2025. People subject to the IRMAA adjustment are also ineligible for the $90 rebate payment.
Most Part B premiums paid through Social Security
Most Part B enrollees have their premium deducted from their monthly Social Security payment. Rising Part B premiums and out-of-pocket costs can leave older adults and retirees, especially those on fixed incomes, with less disposable income for living expenses.
In 2024, 12 percent of Part B enrollees — 7.4 million people — spent more than 10 percent of their income on Part B premiums, says KFF.
If accurate, however, the projected Part B premium hike for 2027 won’t be large enough for most beneficiaries to avoid at least part of the increase through the Social Security Act’s hold-harmless provision. The rule prevents Medicare Part B premium increases from reducing some recipients’ monthly Social Security payments to less than what they received the previous year. About 30 percent of Part B enrollees aren’t eligible for the hold-harmless provision, including those who don’t receive Social Security benefit checks and those subject to the IRMAA provision.
The 2027 cost-of-living adjustment for Social Security benefits won’t be announced until Oct. 14, but AARP expects a 3.6 percent increase based on current inflation data. This would increase the average retiree’s benefit payment by roughly $75 a month next year.
Because the expected 3.6 percent cost-of-living adjustment is larger than the trustees’ projected premium increase of 3.25 percent, older adults could get some relief next year from rising consumer and health care prices.
But any reprieve may be short lived, says Harriet Komisar, a senior policy adviser at the AARP Public Policy Institute. That’s because Part B premiums are expected to grow faster than projected increases in the cost-of-living adjustment after 2027.
“This means people will see Medicare premiums taking up a growing portion of the yearly increase they get from the Social Security cost-of-living adjustment,” Komisar says.
Part B premium could hit $272.10 in 2031
Medicare trustees’ current estimates project the standard Part B premium will rise by an average of 6 percent a year from 2026 through 2031, when the premium is currently projected to hit $272.10 per month. That’s a 34.1 percent increase from the current Part B premium of $202.90.
If that forecast is accurate, it would weaken the impact of the Social Security cost-of-living (COLA) adjustment, says Shannon Benton, executive director of The Senior Citizens League, a nonpartisan, nonprofit advocacy group.
“It’s supposed to help Social Security beneficiaries keep pace with inflation. So they’re certainly not going to be able to keep pace with inflation if they’re getting a 3-point-something cost-of-living adjustment, but their Medicare Part B premium goes up 6 percent,” Benton says.
Komisar says the factors behind the expected premium increases “are the same ones that drive growth in overall national health care costs — medical and technological advances that make more types of diagnosis and treatment possible, population aging which increases the need for medical care, and rising medical care prices.”
Premiums may erode Social Security COLA
Meanwhile, the Social Security cost-of-living adjustment is projected to increase by an average of 2.4 percent per year from 2027 to 2031, says the Social Security annual trustees’ report.
Based on that projection, a person receiving about $2,080 per month in Social Security benefits — roughly the average for a retired worker in 2026 — can expect annual COLA adjustments to boost their payments by about $260 to roughly $2,340 per month in 2031, Komisar says.
But projected Part B premium hikes totaling $69 over the same five-year period would absorb more than 25 percent of the $260 in COLA increases between 2026 and 2021, Komisar says. That means they’ll “have less of their COLA increase available to address other rising costs,” Komisar says.
AARP working to slow growth of Medicare premiums
AARP supports several policies that would make Medicare more affordable for beneficiaries, reduce program waste and avoid unnecessary premium growth. These include:
- Reducing excess payments to Medicare Advantage plans that make Part B premiums nearly $15 higher per person each month in 2026, according to the Medicare Payment Advisory Commission.
- Combating fraud, waste and abuse in Medicare by funding enforcement efforts to uncover and fight the problem, while maintaining needed access to care.
- Helping more people get financial assistance with premiums and out-of-pocket costs by streamlining enrollment and simplifying eligibility requirements for Medicare Savings Programs.
- Adding an out-of-pocket spending limit on health care costs for beneficiaries in original Medicare to guard against catastrophic medical bills. Medicare Advantage plans already have a cap.
What determines Medicare Part B premiums?
CMS actuaries estimate per-person Part B spending for beneficiaries 65 and older and set the premium to cover a quarter of those costs.
“The base premium that most people on Medicare pay is 25 percent of the projected Part B total spending per person,” says Gretchen Jacobson, vice president of Medicare for the Commonwealth Fund.
One of the two Medicare trust funds, the Supplementary Medical Insurance Trust Fund, finances Medicare’s Part B physician and outpatient services and Part D prescription drug benefits. Medicare taxes deducted from your paycheck don’t go into this fund.
The revenue and premiums needed to meet Part B and Part D costs for the coming year are calculated annually so that this trust fund doesn’t face a shortfall, according to KFF. But higher anticipated Part B spending because of increased use of services, inflation or legislative changes can mean higher premiums in the future.
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