Medicare's Part B monthly premium for 2022 will increase by $21.60, the largest dollar increase in the program's history, according to the Centers for Medicare & Medicaid Services (CMS) announcement on Nov. 12. Standard monthly premiums for Part B will cost $170.10 in 2022, up from $148.50 in 2021.

The historically large increase is primarily due to the new Alzheimer's drug, Aduhelm, from pharmaceutical company Biogen, which is administered intravenously in an outpatient office and paid for under Part B. CMS is currently reviewing whether Medicare will cover Aduhelm and officials have said that the fact they are setting aside money to cover the use of that drug "in no way implies what the coverage determination will be" but that they have to plan for the possibility that Medicare will cover this high-cost drug, whose price has been estimated at $56,000 a year.

“Once again, American seniors and taxpayers will pay the price for the outrageous pricing behavior of big drug companies," said Bill Sweeney, AARP senior vice president for government affairs. “When Big Pharma sets a high drug price, everyone pays for it—not just those who need the medications. That's why Congress must act swiftly to pass prescription drug reforms in the 'Build Back Better Act,' which would bring meaningful, much-needed relief to seniors and all Americans."

The other half of the premium increase is due to the natural growth of the program and adjustments made by Congress last year, which took action to significantly lower the expected Part B premium increase during the coronavirus pandemic. In 2021, the Part B premium increased by only $3 a month with Congress directing CMS to pay back that reduced premium over time, starting in 2022.

Not only is this year's Part B premium spike substantial, but it's also well more than what the Medicare trustees estimated in their annual report released in August when estimates were pointing toward a standard Part B premium of $158.50 a month.

However, the increase guarantees that health care will gobble up a big chunk of the 5.9% cost-of-living adjustment (COLA) seniors are to receive in 2022, an increase that that had worked out to $92 a month for the average retired worker. Additionally, seniors on Medicare are also set to face an annual Part B deductible of $233 in 2022, a $30 increase from 2021.

“The increase in the Part B premium for 2022 is continued evidence that rising drug costs threaten the affordability and sustainability of the Medicare program," said Chiquita Brooks-LaSure, Medicare chief.

Olivia Overman is IA content editor.