Bad news for some Medicare beneficiaries

The year 2016 will send shockwaves to some Medicare beneficiaries — roughly 7 million Americans. They’re going to be paying a lot more for their monthly Medicare Part B premium.

Individuals affected will see their monthly premiums rise from about $104.90 to $159.30, and $318.60 for married couples. Those whose income exceeds the threshold, as defined by individuals making more than $214,000 or couples making more than $428,000 per year, the projected increase is anywhere from $223 per month up to $509.80 per month. For high-earning married couples, their premiums can increase from $446 to $1,019.60 per month.

It all has to do with a legal provision that addresses cost-of-living adjustments for Social Security benefits, and the fact that there won’t be an adjustment next year. Unless there is action by Congress or the Department of Health and Human Services, the premium increases will go into effect in 2016. A bill to block the premium spikes was recently introduced, but the outcome is pending.

Here’s what you need to know. The premiums will affect:

— New enrollees in 2016
— Enrollees who don’t collect Social Security yet
— Enrollees with high incomes (individuals earning $85,000 or married couples bringing in $170,000)
— Dual Medicare-Medicaid beneficiaries (Out of those whose premiums are set to rise, only about half would have to bear the cost themselves. The other half who are duel beneficiaries will have their premiums paid for by Medicaid)

If you’re part of this group, you’ll want to do some extra planning.

Those who have deferred claiming Social Security, and who enroll in Part B for the first time in 2016, may want to consider enrolling earlier if they’re already 65 and eligible. Individuals can avoid higher premiums if they start receiving their Social Security benefits, and have their premiums deducted, in November and December 2015.

If you are already on Medicare, or could apply immediately, and you were going to start Social Security benefits in the next year or so, and you are not subject to a high income threshold, some financial advisers say you should consider applying for both of those benefits rights now.

By filing earlier and receiving both your Social Security benefits and Medicare by the end of 2015, you’ll fall into the group that will be exempt from the premium increase. Generally filing a month in advance is sufficient.

There is a cost to taking Social Security early that should be factored into the decision though, said Peter Mallouk, a certified financial planner and chief investment officer for Creative Planning in Kansas City. “Given that the Medicare premium increase will likely only last one year, it may not make sense for individuals to file for Social Security benefits in 2015,” he said. “In addition, if an individual has other options for health insurance, such as continuing on a spouse’s employer health insurance plan or an employer retiree plan in 2016, that may be a better option than filing for Medicare.”

For those who have higher incomes, consider if you’ve had a life-changing event, such as a job loss, marriage, divorce, or death of a spouse, that has put you in a lower income bracket. You could qualify for an exemption based on these events.

Speak to a financial advisor and the Social Security Administration for various options that may be available to you, so you can maximize your future Social Security payments.

CORRECTION: The 2016 changes to Medicare Part B will affect 30 percent of Medicare beneficiaries, but only about half will pay the increases out of pocket. That figure was misstated in an earlier version of this article.

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