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Costs & IRMAA

Medicare Spending Is on Track to Double by 2036, and Part B Premiums Have More Than Quadrupled Since 2000

A Medicare Rights Center analysis published August 6 traces three decades of Medicare cost growth and identifies Medicare Advantage overpayments as one driver that raises costs for all enrollees, not just those in private plans.

By the Goodsurance editorial teamAugust 8, 2026

Medicare spending on benefits grew from about 200 billion dollars in 2000 to nearly 988 billion dollars in 2025 and is on pace to top 2 trillion dollars by 2036, according to an analysis published August 6 by the Medicare Rights Center. Spending per beneficiary climbed from roughly 5,800 dollars in 2000 to roughly 18,900 dollars in 2025.

Premium growth has been steeper. The standard Part B monthly premium was about 45 dollars in 2000, or about 546 dollars per year. By 2026 it reached 202.90 dollars a month, about 2,435 dollars per year, more than fourfold over 26 years. The annual Part B deductible nearly tripled, and the Part A inpatient hospital deductible climbed to 1,736 dollars in 2026 from 776 dollars in 2000.

Medicare spending has nearly quintupled since 2000. Part B premiums have more than quadrupled. A new analysis traces what is driving both.

The analysis points to Medicare Advantage overpayments as an underappreciated cost driver. Because Part B premiums are set partly to cover total program spending, higher payments to Medicare Advantage plans affect what every Medicare enrollee pays each month, including those who stay in Original Medicare. The Medicare Rights Center calculated that overpayments to Medicare Advantage plans added roughly 212 dollars per person to the 2025 Part B premium, totaling about 13.4 billion dollars across the program in that year alone.

The analysis does not call for specific legislative remedies, but the authors note that enrollment is projected to rise to 91 million beneficiaries by 2060, making the payment and spending trajectory an issue that will grow in scale with each passing year.

In plain words

Medicare now spends close to 1 trillion dollars a year, a number that was only about 200 billion dollars in 2000. The monthly cost for Part B has gone up more than four times since then. One reason all Medicare enrollees pay more is that Medicare pays private Medicare Advantage plans more than it would spend on those same people in traditional Medicare. A nonprofit called the Medicare Rights Center says that extra cost added about 212 dollars per person to the 2025 Part B bill for everyone, not just people in Medicare Advantage.

Understand the basics first

Source: Medicare Rights Center
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