As the open enrollment period for Medicare plans runs from October 15 to December 7, beneficiaries are evaluating their options and making adjustments to their coverage. However, these new changes to the Medicare program are likely to add further financial pressure on many seniors, especially as other insurance costs rise due to inflation and increasing demand for certain medical treatments.
Increased Costs for Hospital and Skilled Nursing Care
Medicare Part A covers inpatient hospital services, skilled nursing facilities, hospice care, and certain home health services. According to CMS, 2026 will see significant increases in the cost-sharing requirements for beneficiaries using this coverage.
For those who require hospitalization, the inpatient hospital deductible will rise from $1,676 to $1,736, marking a $60 increase. This deductible applies to the first 60 days of inpatient care in a benefit period, and is an essential cost that beneficiaries must cover before their Medicare benefits kick in.
Additionally, the daily coinsurance for the 61st to 90th day of hospitalization will increase from $419 to $434 per day. Beneficiaries who exceed 90 days in the hospital will need to pay a coinsurance of $868 per day for lifetime reserve days, an increase from $838. These increases, while seemingly incremental, could place a heavy burden on seniors requiring extended hospital stays.
For those needing care in a skilled nursing facility, the daily coinsurance for days 21 through 100 will rise from $209.50 to $217 per day. This affects patients who require long-term care, such as those recovering from surgery or illness. The cost increases in Part A will particularly affect individuals who have fewer than 40 quarters of coverage. Those in this category will see their premiums rise to $565 per month, a $47 increase compared to 2025.
Steep Premium Hikes for Outpatient Care
Medicare Part B, which covers outpatient services, physician visits, and certain medical equipment, is also set for a premium increase. According to CMS, the standard monthly premium for Part B will jump by $17.90, reaching $202.90 in 2026. This increase will affect all beneficiaries who are enrolled in the standard plan, though higher-income individuals will pay more.
In addition to the premium hike, the annual deductible for Part B services will rise from $257 to $283. This is the amount beneficiaries must pay out of pocket before Medicare covers any outpatient services. The increase reflects ongoing price changes and anticipated rises in healthcare utilization.
For high-income earners, the Part B premiums are scaled based on income. Individuals with a modified adjusted gross income of over $500,000 will pay up to $689.90 per month for Part B coverage, marking a significant jump from previous years. This is part of a broader strategy in which higher-income Medicare recipients contribute more to offset the rising costs of the program.
Though the increases are primarily driven by general inflation and demand for healthcare services, particularly in specialized drugs and treatments, the added financial burden will likely be felt most by those with fixed incomes, such as retirees, and individuals with complex medical needs.
Rising Healthcare Costs and Economic Strain
The rising costs of Medicare reflect a larger trend in the healthcare sector, where inflation, labor shortages, and an aging population continue to drive up expenses. In particular, demand for expensive treatments such as GLP-1 drugs (used for weight loss and diabetes management) and other specialized therapies is straining the system.
These cost increases come at a time when millions of Americans are already facing higher insurance premiums due to the expiration of enhanced tax credits under the Affordable Care Act (ACA). As other forms of healthcare insurance become more expensive, Medicare recipients may find it more challenging to manage their healthcare costs, particularly if they require frequent hospitalization or outpatient services.
While the changes to Medicare in 2026 are not unexpected, they highlight the growing financial challenges faced by seniors in the U.S. As premiums and deductibles rise, it becomes increasingly important for beneficiaries to review their options and consider the long-term implications of these changes for their healthcare needs.
