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Fact or fiction? Insurance premiums always go up

Medicare premiums increase every year, just as other health insurance premiums do. fact-checks this claim — and more.

Claim: Medicare premiums increase every year, just as other health insurance premiums do.

According to the Kaiser Family Foundation, the average premium for employer-sponsored insurance for family coverage is $13,375 -- 5 percent higher than the average premium last year. In the past 10 years, premiums for employer-sponsored insurance have increased by an average of 8.7 percent a year. Unlike employer-sponsored insurance, Medicare is a form of social insurance in which younger workers pay for beneficiaries aged 65 and older. Most of those enrolled in Medicare Part A, which covers hospital stays, pay no premiums. For Medicare Part B, which pays for doctors' and outpatient services, beneficiaries pay premiums that cover about one-fourth of the cost of the services they get.

Fact or fiction?
A little of both. Both private insurance and government-run insurance grow more costly every year. Why? Because what the insurance is paying for — surgical procedures, doctors’ services, diagnostic tests, etc. — keeps growing more costly. From 2000 to 2009, Medicare Part B premiums went up by an average of about 8 per cent a year. In 2010, Part B premiums will go up to $110.50 a month from $96.40, but for only about 27 percent of those in the program. Most people won’t have to pay that increase due to a "hold harmless" provision in the law: Since there will be no Social Security cost-of-living adjustment in 2010, most people in Medicare won’t have to pay the higher premiums.

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