Retirees on Medicare Just Got Some Hidden Bad News

Key Points

• Medicare Part B premiums are a big expense for many retirees.

• In 2025, the standard monthly Part B premium is $185.

• The newest Medicare Trustees report points to a potentially massive increase in 2026.

• The $23,760 Social Security bonus most retirees completely overlook ›

You'll often hear that once you retire, many of your expenses will decrease. Housing, for example, might cost you less because your mortgage may be paid off at that point. Or, you may be able to downsize to a home that's cheaper to own and maintain. And if you're not commuting to work, you might spent a lot less on gas, tolls, and vehicle maintenance.

But if there's one expense that tends to increase in retirement, it's healthcare. And there are a couple of reasons for this.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Image source: Getty Images.

First, aging tends to bring about health issues. Even if you manage to stay relatively healthy, you may find that you need more screenings and medications than you did earlier in life.

Secondly, many retirees end up getting health coverage through Medicare once they turn 65. And one big misconception about Medicare is that it's inexpensive healthcare.

Quite the contrary. Many retirees pay a lot of money for Medicare coverage, and that's on top of the cost of copays, deductibles, and other expenses.

One cost that many retirees tend to moan about is the expense of Medicare Part B, which covers outpatient care. In 2025, the cost of Part B rose compared to the year prior. And unfortunately, seniors could be looking at an even more substantial hike in 2026.

How Part B increased in 2025

In 2025, the standard Medicare Part B premium rose to $185 from $174.70 the year before. That means the typical senior this year is paying $123.60 more on an annual basis.

That's just what the standard Part B premium costs, though. Higher earners are commonly subject to surcharges called income-related monthly adjustment amounts, or IRMAAs, that can drive the cost of Medicare up even more.

How high could Part B get in 2026?

Each year, the Medicare Trustees release a report detailing the program's finances. This year's report was 267 pages long, which means the typical retiree probably isn't reading it cover to cover.

Buried in that report, however, is some potentially disturbing news. Based on the Medicare Trustees' most recent projections, the standard monthly Medicare Part B premium could rise to $206.50 in 2026. The annual deductible for Part B could also increase from $257 this year to $288 in the new year.

The problem here is twofold. First, any increase in the cost of Medicare Part B could burden seniors tremendously.

But also, based on estimates so far, next year's Social Security cost-of-living adjustment (COLA) is not looking to be that large. The fear is that a substantial Part B premium hike could wipe out a big chunk of the typical Social Security COLA, leaving some retirees with virtually no raise.

Of course, that $206.50 number isn't set in stone -- it's just an estimate, which means the official number could come in lower. It could also come in higher, though. Current retirees may want to brace for a notable Part B premium hike in the new year -- and perhaps look at cutting some expenses in the near term to make up for it.

The $23,760 Social Security bonus most retirees completely overlook

If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income.

One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.