Medicare officials have announced a hike of 5.6 percent for basic Medicare coverage of seniors next year. Besides this premiums for the wealthier// beneficiaries will increase by 83 percent, because for the first time the federal government has required the affluent to pay more.

Mark B. McClellan, head of the Centers for Medicare and Medicaid Services said that the standard monthly premium for Part B covering doctor visits and outpatient hospital care, will rise to $93.50 from $88.50 this year.

Individuals with an annual income of more than $80,000 (or more than $160,000 for married couples) will pay monthly premiums of $106 to $162.10, depending on income.

According to a change instituted by Congress as part of the 2003 law that created the Medicare drug benefit about 1.5 million of the 42 million Americans on Medicare will have to pay the higher premiums based on income,. McClellan has said that the income-based premiums will save the financially troubled program $7.7 billion over five years and more than $20 billion over a decade.

He said that even at the increased rates, Medicare remains a good deal because when the affluent beneficiaries, with individual incomes of over $200,000 a year pay just $2,000 a year in premiums they receive an average of $4,300 a year in benefits.

McClellan said, "That still makes it a very attractive insurance package."

The leader of one senior group organization predicted that with the higher premiums some of the more affluent seniors might be deterred, thereby undermining Medicare's broad political support and its finances.

Shannon Benton, executive director of the Senior Citizens League, an advocacy group with 1.2 million members said, "As healthier and wealthier seniors see their premiums rise, we fear that when that premium equals what they could pay for regular health insurance, why be in the program at all? We feel that eventually the sickest, the oldest and the po
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