How Higher Medicare Costs Will Affect Older Adults in 2026

Takeaways

• The Centers for Medicare & Medicaid Services (CMS) announced increases to Medicare Part A and Part B premiums and deductibles for 2026.
• The standard Medicare Part B monthly premium will increase to $202.90 (up $17.90), exceeding $200 for the first time, and the annual Part B deductible will rise to $283 (up $26).
• The Part A deductible for inpatient hospital stays will also increase to $1,736 (up $60).
• These increases are attributed to projected price changes and growing demand for health care services, reflecting overall rising medical costs.
• The higher costs mean a greater financial burden on older adults and retirees, particularly those on fixed incomes, potentially consuming much of any Social Security cost-of-living adjustment (COLA).
• Older adults are advised to review health needs, explore supplemental coverage like Medigap, budget carefully for healthcare expenses, and compare options like Medicare Advantage plans.
• The increases underscore the ongoing financial challenges within Medicare and the mounting cost pressures faced by an aging population.

At a time when we are frequently confronting the rising cost of living, Medicare enrollees will soon see a rise in their premiums and deductibles. In mid-November 2025, the Centers for Medicare & Medicaid Services (CMS) announced the Medicare Parts A and B premiums and deductibles for 2026.

What’s Changing in 2026

Perhaps the most notable change is the increase in what Medicare beneficiaries will have to pay.

• The standard monthly premium for Medicare Part B (generally outpatient services) will rise to $202.90 per month in 2026, up $17.90 from $185.00 in 2025. This is the first time the Part B premium has exceeded $200.
• The annual Part B deductible will increase to $283, up from $257 in 2025.
• Most people who are enrolled in Medicare Part A (generally inpatient services) have met the 40 work quarters minimum and don’t have to pay a premium. However, premiums will increase for those who have to pay them.
• The Part A deductible for inpatient hospital stays will rise to $1,736, from $1,676 in 2025.

In short, both the recurring costs (premiums) and up-front costs (deductibles) for key parts of Medicare are increasing.

Why the Increase?

According to the CMS, the increases stem from projected price changes and assumed increases in Medicare benefits usage that are consistent with historical trends. In other words, the increases are in line with rising costs of medical care overall and growing demand for services among Medicare beneficiaries.

The CMS also noted that without certain cost-saving measures (for example, reducing overuse of expensive wound-care treatments), the Part B premium could have been about $11 more per month. In a sense, these numbers reflect both medical cost inflation and efforts to control runaway spending.

What This Means for Older Adults and Retirees

• Higher monthly costs. Monthly premiums for Part B will increase by $17.90, which adds up to an annual increase of $214.80. For many older adults on fixed incomes, such as Social Security, that jump may feel significant.
• Out-of-pocket costs may rise. A higher Part B deductible means that if you need outpatient services, such as doctor visits, outpatient surgeries, or durable medical equipment, you’ll need to pay more out of pocket before Medicare coverage kicks in.
• Costs may climb for hospital stays. The higher Part A deductible and coinsurance amounts will mean steeper costs for inpatient stays.
• Income-related premiums could be higher. Though $202.90 will be the standard premium for many beneficiaries, people with higher incomes will pay more due to the income-related monthly adjustment amounts (IRMAA).
• Effect on budgets and retirement planning. For those living on Social Security or a fixed income, the increase may absorb a sizable portion of any cost-of-living adjustment (COLA) they receive.

What You Can Do About the Changes

• Review your 2026 health and prescription needs. If you anticipate needing many doctor visits, durable medical equipment, medications, or hospital stays, higher deductibles and premiums mean higher out-of-pocket costs.
• Explore supplemental coverage. If you have, or are considering, a Medigap plan, it may help cover deductibles and coinsurance that Original Medicare doesn’t cover, which may be especially valuable when premiums and deductibles increase.
• If your income is on the high side, check the numbers. Because of IRMAA surcharges, some beneficiaries will pay significantly more than the standard premium. Consider calculating 2026 costs based on your modified adjusted gross income.
• Budget carefully. These increases reinforce how important it is for retirees and older adults to plan for health care expenses in their budgets, especially in light of medical inflation and rising living costs.
• Keep an eye on coverage options. For some, switching to a Medicare Advantage plan may make sense, but be sure to compare premiums, coverage, networks, and out-of-pocket limits carefully.

What This Says About Challenges in Medicare

The 2026 increases highlight a broader challenge: As medical costs rise and demand for care grows (especially among an aging population), so does the financial burden on older adults. Even though Medicare remains a critical safeguard for many, cost pressures continue to mount.

These changes come at a time when many seniors face competing financial pressures, not only from health care costs, but also from the rising costs of housing, long-term care, everyday necessities, and more. For people relying on fixed incomes, modest COLA increases may be largely consumed by rising Medicare costs.

Additional Reading

For additional reading on topics related to Medicare, check out the following articles:

• Entering and Leaving Medicare Advantage Plans
• Medicare Part D Plans 2025: Prescription Drug Coverage
• Turning 65? What to Know About the 4 Parts of Medicare
• Do Medigap Plans Cover the Medicare Part B Deductible?
• Getting the Medicare Grocery Allowance for Seniors
• Basics on Medicare Home Health Coverage