Medicare Part B premiums could nearly double by 2035

A new report projects steep premium hikes

A new congressional report warns that Medicare Part B premiums could nearly double over the next decade.

The Joint Economic Committee released its findings on March 10, 2026, projecting that standard annual premiums could climb from about $2,200 in 2025 to roughly $4,500 by 2035.

Average per-person premiums, which factor in income adjustments, could rise from about $2,440 to nearly $5,000 over the same period. These are projections under current law, not certainties.

Spending drives premiums up automatically

Here is why premiums track so closely with costs. Under current law, Part B premiums are set to cover about 25% of expected program costs.

So when overall spending rises, premiums follow automatically.

Per-person Part B spending is projected to nearly double as well, going from about $9,100 in 2025 to more than $18,000 by 2035.

Every Part B enrollee feels this, whether they are in traditional Medicare or a private Medicare Advantage plan.

Medicare Advantage now covers half of seniors

Medicare Advantage is the private insurance alternative to traditional Medicare, offered by companies like UnitedHealthcare, Aetna, and Blue Cross Blue Shield.

More than half of Medicare’s roughly 63 million Part B enrollees now use Medicare Advantage plans. Congress originally designed the program to cost less than traditional Medicare.

But the JEC report found that in 2025, the federal government paid Medicare Advantage insurers an estimated $76 billion to $84 billion more than the same coverage would have cost under traditional Medicare.

Higher MA payments raise costs for everyone

Because Part B premiums are calculated using total program spending, higher payments to Medicare Advantage plans push up premiums for every Part B enrollee, not just those in private plans.

The JEC defines these as “overpayments,” meaning the gap between what the government pays private insurers versus what the same care would cost through traditional Medicare.

Seniors who never joined a Medicare Advantage plan still end up paying more each month because of those payments. The insurance industry disputes that framing.

Overpayments added $13.4 billion to premiums

The JEC estimates that Medicare Advantage overpayments added $212 per enrollee to Part B premiums in 2025, totaling $13.4 billion in higher premiums across the program.

Since 2016, those overpayments have added an estimated $82 billion to Part B premiums overall.

Seniors in traditional Medicare, who get no Medicare Advantage benefits, directly bear roughly $6 billion of that burden.

About 85% of the added premium cost falls on individuals, with the rest split between state and federal taxpayers.

Premium hikes chip away at Social Security

For most seniors, Part B premiums come straight out of their monthly Social Security checks. That means every premium increase directly cuts take-home pay.

The 2026 cost-of-living adjustment added about $56 per month to the average Social Security check, but the Part B premium increase of $17.90 per month ate up nearly a third of that raise.

This is the third straight year that Part B premium increases have outpaced Social Security adjustments.

2026 premiums are already rising fast

The standard monthly Part B premium for 2026 is $202.90, up from $185 in 2025, a nearly 10% increase. Higher-income enrollees pay more, with 2026 premiums reaching up to $689.90 per month.

The annual Part B deductible also rose to $283 in 2026, up $26 from the year before.

The Centers for Medicare and Medicaid Services said the 2026 increases are mainly due to projected price changes and higher utilization rates consistent with historical trends.

The 2035 outlook if nothing changes

By 2035, the report projects that about $450 of the roughly $5,000 average annual Part B premium could come directly from continued overpayments to Medicare Advantage plans if current payment policies stay in place.

The JEC said aligning Medicare Advantage payments with traditional Medicare costs would save the average senior about $2,600 over the next decade.

As overall costs rise, more seniors will also cross income thresholds that trigger higher premiums, compounding the burden further.

A Republican committee raised the alarm

The JEC report came from the committee’s Republican majority staff.

JEC Chairman David Schweikert, a Republican from Arizona, said the math shows that when Medicare Advantage is overpaid, seniors in traditional Medicare end up subsidizing the system.

Republicans have long supported Medicare Advantage, so this criticism from within the party stands out. The Wall Street Journal reported on the findings before the JEC formally released the brief.

The insurance industry calls the data flawed

The Better Medicare Alliance, a major Medicare Advantage industry group, called the underlying analysis ideologically biased against private-sector participation in Medicare.

AHIP, a health insurance trade group, said the report relied on fundamentally flawed data and methodology and should not drive policy decisions.

The Healthcare Leadership Council, whose members include UnitedHealth, called the report the latest example of what it considers a false narrative about Medicare Advantage payment rates.

Some Medicare Payment Advisory Commission members have acknowledged their methodology is imprecise, though the commission says evidence of overpayments is clear.

Some states carry a bigger share of the burden

Part B premiums are set at a national rate, but Medicare Advantage enrollment varies widely by region.

States with low MA enrollment, like Wyoming, bear a larger share of the premium burden caused by overpayments without receiving the extra benefits that MA plans offer.

The JEC released a Medicare Affordability Tracker alongside the report, showing estimated excess premium costs for every state and congressional district.

About 9% of excess premiums are paid by federal taxpayers and 6% by states, mostly through Medicaid programs covering low-income seniors.

Congress and CMS weigh next steps

The JEC recommends aligning Medicare Advantage payments with traditional Medicare costs to slow premium growth and protect Social Security checks.

CMS has proposed removing one tool insurers use to record additional diagnoses as part of a 2027 payment rule that would hold MA reimbursement rates essentially flat.

The insurance industry has warned that flat rate updates would force benefit cuts for seniors.

Both the Biden and the second Trump administrations have pursued reforms to how Medicare Advantage companies calculate member health needs, but the insurance industry’s lobbying has slowed major changes.

This article was created with AI assistance and human editing.

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