A higher Medicare premium taking effect in 2026 will push the monthly Part B charge above $200 for the first time and likely erode much of next year’s cost-of-living adjustment (COLA) for millions of Social Security recipients.
The Centers for Medicare & Medicaid Services announced the Part B premium — which covers doctor visits and outpatient services and is automatically deducted from Social Security checks — will rise 9.7% to $202.90, an increase of $17.90 from the current $185. That’s the largest increase since 2022, when the premium jumped 15%. The Part B deductible will also climb about 10%, to $283 next year from $257 this year.
The premium increase is outpacing inflation, roughly three times the inflation rate, driven in part by rising underlying health care costs, according to Anne Montgomery, senior health policy expert at the National Committee to Preserve Social Security and Medicare (NCPSSM). Increased demand for medical services has also pushed Medicare costs higher, CMS said. Max Richtman, president and CEO of NCPSSM, warned the jump will hit many retirees hard: “So many rely on [Social Security] for all or most of their income. This is gonna hurt.”
The Social Security Administration set the 2026 COLA at 2.8%, which would raise the average Social Security benefit by about $56 to roughly $2,071 per month. But the higher Part B premium will consume about a third of that increase, effectively reducing the real boost to about 1.9%, NCPSSM’s analysis found. For people with lower benefits, the effective COLA could be zero once the premium is deducted.
Health care costs have been rising for Americans generally. In 2023, U.S. households spent an average of $1,514 on out-of-pocket health care costs, a 9% increase from 2020 on an inflation-adjusted basis, according to KFF.
The impact isn’t limited to Medicare beneficiaries. About 22 million Americans who buy coverage through the Affordable Care Act marketplaces could face steep premium increases if Congress does not extend enhanced premium tax credits that are set to expire at the end of 2025; without those credits, many marketplace enrollees could see their costs more than double in 2026, KFF estimates. Employer-sponsored plan costs are expected to climb as well, with most workers likely to pay 6% to 7% more for 2026 coverage, according to Mercer.
