Be prepared to shell out more money for coverage.
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There’s a reason why many older workers strive to remain employed until age 65. Generally, eligibility for Medicare begins at age 65. And without Medicare or employer-sponsored insurance, the cost of health insurance can be astronomical.
However, Medicare is never free. Part A, which covers hospitalization, typically requires no premiums for enrollees, while Medicare Part B, which covers outpatient care and physician services, is costly.
In 2026, Medicare Part B costs will increase significantly. Here’s what retirees need to know.
Part B coverage is expected to cost more
The costs associated with Medicare Part B can increase each year. In 2026, the standard monthly Part B premium increases from $185 to $202.90. That means the average senior will pay $17.90 more.
But that’s it standard Medicare Part B monthly premium. High-income earners are subject to an Income-Related Monthly Adjustment Amount (IRMAA), which can further increase the cost of Part B.
In 2026, single taxpayers with incomes over $109,000 will be eligible for Medicare IRMAA. Married couples with incomes above $218,000 will also be required to file jointly.
Also, IRMAA doesn’t just apply to Medicare Part B premiums. They also apply to premiums charged by Part D drug plans. However, unlike Part B, there is no standard monthly premium for Part D. The cost varies depending on the plan the retiree chooses.
Meanwhile, not only will standard Medicare Part B premiums increase in 2026, but so will Part B deductibles. It went from $257 to $283, an increase of $26.
Medicare Part B hike will eat into next year’s Social Security hike
Social Security benefits are subject to a cost of living adjustment (COLA) each year. This is good. That’s because without these COLAs, many recipients won’t be able to keep up with inflation.
In 2026, Social Security benefits will be subject to a 2.8% COLA. This is expected to bring your average monthly profit of $2,015 up to $2,071.
However, seniors who enroll in Social Security and Medicare at the same time pay Part B premiums directly from their monthly benefits. Now, with the cost of these premiums rising, many Social Security recipients are likely to find that they won’t get as much of a raise in 2026 as they originally expected.
The good news is that next year’s Social Security COLA is generous enough for the average recipient to avoid running out of COLA altogether. Still, it is a big blow to the elderly who have struggled to make ends meet.
It’s not just Medicare Part B that’s on the rise
Because Medicare Part A has no premiums, people tend to focus on the increased costs of Part B. But Part A costs are also rising.
In 2026, you will pay even more for each hospitalization. You will also end up paying more if you end up needing a skilled nursing facility.
And, of course, premiums for certain Medicare plans may increase. It’s important to check your Medicare Advantage or Part D plan change notices to see if you’ll need to pay more in premiums for 2026.
Now is the time to prepare
No matter what your retirement financial situation is, it’s important to know what to expect in 2026 when it comes to Medicare costs. In fact, now is a good time to create your 2026 budget. That way, you can manage your money carefully and ensure that your income grows to cover all your needs.
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