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New Medicare Part B premium is $170.10 per month. Here's one reason why.

Medicare's “Part B” outpatient premium hike will gobble up a big chunk of the recently announced Social Security cost-of-living allowance.

WASHINGTON — Medicare's “Part B” outpatient premium will jump by $21.60 next year, one of the largest increases ever. Officials said Friday a new Alzheimer's drug is responsible for about half of that.

The increase guarantees that health care costs will gobble up a big chunk of the recently announced Social Security cost-of-living allowance, a boost that had worked out to $92 a month for the average retired worker.

Medicare officials told reporters on Friday that about half the increase is attributable to contingency planning if the program has to cover Aduhelm, a new $56,000-a-year medication for Alzheimer's disease. The drug would add to program costs because it's administered in a doctor's office and paid for under Medicare's outpatient benefit.

The new Part B premium will be $170.10 a month.

Will Build Back Better help with Medicare prescription costs?

The announcement on premiums comes as Congress is considering Democratic legislation that would curb what Medicare pays for medications. The 10-year, $1.85 trillion Build Back Better measure bolstering health, family and climate change programs was sidetracked last week after moderates demanded a cost estimate on the sprawling measure from the nonpartisan Congressional Budget Office.  

In a deal to get President Joe Biden's companion $1 trillion infrastructure bill over the finish line last week, five moderates agreed to support Build Back Better if CBO's estimates are consistent with preliminary numbers that White House and congressional tax analysts have provided. The agreement, in which lawmakers promised to vote on the social and environment bill by the week of Nov. 15, stood as a significant step toward a House vote that could ultimately ship it to the Senate.

However, the CBO said Tuesday that while some estimates would be released this week, other estimates would take longer and a release date for those would be announced later.

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