Yes, Medicare costs are going up for 2025 and continuing to rise into 2026. The standard Part B premium for 2025 is $185.00 per month, and CMS has already announced further increases for 2026. These increases are driven primarily by rising healthcare prices and higher utilization of medical services. Here’s what the numbers look like and what they mean for your budget.
Part B Premiums in 2025
The standard monthly premium for Medicare Part B, which covers doctor visits, outpatient care, and some preventive services, is $185.00 in 2025. That’s up from $174.70 in 2024, an increase of $10.30 per month or about $123.60 over the full year.
Most Medicare beneficiaries pay this standard amount. But if your modified adjusted gross income is above $106,000 as an individual filer (or $212,000 for joint filers), you pay more. These income-related surcharges add anywhere from $74 to $443.90 on top of the base premium, pushing monthly costs as high as $628.90 for the highest earners. The income brackets and surcharge amounts are set by CMS each year based on tax returns from two years prior.
What’s Changing for 2026
CMS has confirmed that Part B premiums will rise again in 2026. The increase is mainly due to projected price changes across healthcare services and utilization increases consistent with historical patterns. One notable detail: spending on skin substitutes (wound care products) had been driving costs up so sharply that premiums would have been about $11 more per month without recent policy changes. A rule finalized in the 2026 Physician Fee Schedule is expected to cut spending on these products by 90% without affecting patient care, keeping the premium increase smaller than it otherwise would have been.
Prescription Drug Costs: A Mixed Picture
Part D, which covers prescription drugs, also carries income-related surcharges identical in structure to Part B. If you earn above the $106,000/$212,000 thresholds, you’ll pay an additional $13.70 to $85.80 per month on top of your plan’s premium.
The bigger news for prescription drugs is actually positive. Starting in 2025, there is a hard $2,000 annual cap on out-of-pocket spending for Part D covered drugs. Once you hit that threshold, you pay nothing for the rest of the year. This is a major change. Previously, beneficiaries in the catastrophic coverage phase still owed 5% of drug costs, which could add up to thousands of dollars annually for people taking expensive medications. The new cap provides real financial protection, especially for anyone on high-cost specialty drugs.
The national base beneficiary premium, used to calculate Part D late enrollment penalties, is $38.99 in 2026.
Medicare Advantage Premiums
If you’re enrolled in a Medicare Advantage plan rather than Original Medicare, the trend is actually favorable. The average monthly premium across all MA plans is estimated at $16.40 in 2025, dropping to $14.00 in 2026. These averages include plans with prescription drug coverage and Special Needs Plans. Of course, individual plan premiums vary widely by region and insurer, so your specific plan may not follow the national average.
How Social Security Offsets the Increase
Social Security benefits received a 2.5% cost-of-living adjustment (COLA) in January 2025, which adds a few dozen dollars to most monthly checks. For many beneficiaries, this increase more than covers the $10.30 rise in Part B premiums, leaving a small net gain. But for those with smaller Social Security payments, the premium hike can eat up most or all of the COLA.
A provision called “hold harmless” prevents your Social Security check from actually shrinking due to a Part B premium increase. If your COLA isn’t large enough to fully absorb the new premium, your Part B cost is capped at whatever amount keeps your Social Security payment the same as the previous month. To qualify, you need to be receiving Social Security benefits and have your Part B premiums deducted directly from those payments. This protection does not apply if you’re enrolling in Part B for the first time, if you pay income-related surcharges, or if Medicaid pays your premiums.
Income Brackets That Trigger Higher Costs
The surcharge system catches more people than you might expect, particularly retirees who sell a home, convert a traditional IRA to a Roth, or have a one-time spike in income. Medicare uses your tax return from two years ago, so your 2023 income determines your 2025 premiums. Here’s how the Part B brackets break down for individual filers in 2025:
- $106,000 or less: $185.00/month (standard premium, no surcharge)
- $106,001 to $133,000: $259.00/month
- $133,001 to $167,000: $370.00/month
- $167,001 to $200,000: $480.90/month
- $200,001 to $499,999: $591.90/month
- $500,000 or more: $628.90/month
For joint filers, each threshold is roughly doubled. If you’ve had a life-changing event that reduced your income, such as retirement, divorce, or the death of a spouse, you can request that Social Security use more recent income instead by filing a reconsideration form.
Why Medicare Costs Keep Rising
Medicare premiums don’t increase arbitrarily. Part B premiums are set to cover approximately 25% of the program’s costs, with the federal government picking up the remaining 75%. When overall healthcare spending rises, premiums follow. The main forces pushing costs higher are the same ones affecting the broader healthcare system: rising prices for medical services, increased use of outpatient procedures, more expensive treatments entering the market, and an aging population that needs more care each year. Individual policy decisions, like how Medicare pays for specific products, can also move the needle, as the skin substitute example for 2026 illustrates.