Medicare Part D IRMAA
What is IRMAA?
Medicare Part D IRMAA stands for Income-Related Monthly Adjustment Amounts that affect those Medicare beneficiaries who have higher income bracket. These people must pay an additional amount to their monthly Medicare Part B and Part D premium to CMS. Part B covers outpatient medical costs, and Part D pays for your prescription costs.
All Part D IRMAA costs are the same and how to pay?
There are difference levels of IRMAA based on their income:
- Individual tax return of $91,000 or less – $182,000 (Married Filing Joint) then you pay for standard part D premium with no additional fees added to CMS invoice.
- Individual: above $91,000-$114,000 – above $182,000-$228,000 (Married Filing Joint), an additional $12.40 will be added to your invoice.
- Individual: above $114,000-$142,000 – above $228,000-$284,000 (Married Filing Joint) additional of $32.10 will be added to your invoice.
- Individual: above $142,000-$170,000 – above $284,000-$340,000 (Married Filing Joint), an additional of $51.70 will be added to your invoice.
- Individual: above $170,000-less than $500,000 – above $340,000-less than $750,000 (Married Filing Joint), an additional $71.30 will be added to your invoice.
- Individual: $500,000 and above– above $750,000 (Married Filing Joint), an additional of $77.90 will be added to your invoice.
Typically, Medicare Beneficiary who is affected by this will be notified by the Social Security Administration (SSA), also on CMS invoice to be precise. How do they determine which income to use? SSA is using Modified Adjusted Gross Income (MAGI), and this is not the current year income tax return but two years ago. For example: If you turn 65 in 2020 then they will base on your MAGI of year 2018 to determine your IRMAA.
SSA has the assessment done each year, and they will notify beneficiaries by the end of November. If you feel your income has been assessed incorrectly then contact SSA, they will include information on how to file for reconsideration, especially if you are undergoing some life changing event like marital status change.
Most people will pay their Part D IRMAA by deducted from their Social Security benefits, but if you have not applied for your benefit or your benefit amount is not enough to cover your part D IRMAA, then CMS will send you an invoice to make payment.
