According to a notification from the Centers for Medicare and Medicaid Services (CMS) last Friday (November 14), the standard Part B outpatient insurance premium for the federal Medicare program, known as the red and blue card, is set to increase by 9.7% in 2026.
The notification disclosed the monthly premium amounts for beneficiaries of the federal Medicare Part B starting in 2026, with monthly premium rates of $405.40 for seniors and $585.60 for disabled participants.
The notification stated that “the premium for 2026 is $202.90, which is $17.90 or 9.7% higher than the 2025 standard premium rate of $185.”
While the increase is lower than the previously predicted $21.50, it is still the second-largest hike in the program’s history, only surpassed by the $21.60 increase in 2022.
This increase is nearly double the hike in 2025 when the standard monthly premium for Part B rose from $174.70 in 2024 to $185.
Next year, the out-of-pocket expense for all Part B enrollees will be $283.
Medical expenses covered by the federal Medicare Part B include ambulance services, outpatient hospital services, certain prescription drugs, medical equipment, oxygen equipment, and services for substance use disorder treatment.
The Trump administration stated that if CMS had not taken action earlier this year on skin substitutes, the premium increase would have been even higher. Skin substitutes refer to biological or synthetic products used for outpatient wound care.
In July, CMS took a series of measures to “reduce waste and unnecessary use of skin substitutes.”
CMS cited data showing that spending on skin substitutes under the federal Medicare Part B increased from $256 million in 2019 to over $10 billion in 2024.
The Department of Health and Human Services (HHS) Office of Inspector General expressed in September that skin substitutes appear to be “particularly vulnerable to questionable billing and fraud schemes.”
In a statement released on Friday, CMS indicated that “the increases in the standard premium and out-of-pocket costs for Part B in 2026 are mainly due to projected price changes and assumed increases in usage, consistent with historical experience. If the Trump administration had not taken action to address unprecedented spending on skin substitutes, the monthly premium for Part B would have increased by about $11, but due to the final changes confirmed in the 2026 Physician Fee Schedule Final Rule, skin substitute spending is expected to decrease by 90% without affecting patient care.”
Senior member of the House Ways and Means Committee, Democratic Representative Richard Neal of Massachusetts, declared in a statement on Monday that “the comprehensive price hike for Medicare illustrates that the Trump administration is still relentlessly targeting the public’s wallets and public health system, and no one is spared.”
[Reference: Congressional Hill Report]