Part B Premiums Will Rise $11 in 2006

Medicare premiums for Part B,which cover physician visits and outpatientservices, are expected to soar to$89.20 per month in 2006—an $11jump from this year's premium.Medicare will lower the payment foreach physician service by 4.3% in2006 unless Congress steps in. Anyattempts to stop those cuts would furtherincrease spending and premiums,according to federal officials.

A preliminary assessment of Medicareattributed the rise in premiums to higherspending on physician office visits,greater use of services including physicaltherapy, higher costs for administrationof chemotherapy drugs and other medicationsgiven in physician offices, andmore frequent use of laboratory tests andimaging procedures.

In a letter to a federal advisory panelregarding the data, Mark McClellan,MD, PhD, administrator of the Centersfor Medicare and Medicaid Services,expressed concern about the rapid risein Medicare spending. Dr. McClellansaid that his agency would evaluatewhether increased use of Part B is necessaryand helpful in improvingpatient care. He said that he favorsconnecting Medicare reimbursementto quality and efficiency, and he isworking with physicians to create asystem to accomplish that goal.