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IRMAA

by Ethan Bynon, October 22, 2021

What is IRMAA?

Income Related Monthly Adjustment Amount (IRMAA) is a Medicare Part BMedicare Part B is medical coverage for people with Original Medicare benefits. It covers doctor visits, preventative care, tests, durable medical equipment, and supplies. Medicare Part B pays 80 percent of most medically necessary healthcare services. and Medicare Part DMedicare Part D plans are an option Medicare beneficiaries can use to get prescription drug coverage. Part D plans provide cost-sharing on covered medications in four different phases: deductible, initial coverage, coverage gap, and catastrophic. Each... premium surcharge that is levied on high-income earners. The surcharge amount is based on a beneficiary’s adjusted gross income.

Key Takeaways

  • IRMAA is a surcharge added to a beneficiary’s Medicare Part B and Part D premiumsA premium is an amount that an insurance policyholder must pay for coverage. Premiums are typically paid on a monthly basis. In the federal Medicare program, there are four different types of premiums.  if their income is above a specified level.
  • Medicare Advantage planMedicare Advantage (MA), also known as Medicare Part C, are health plans from private insurance companies that are available to people eligible for Original Medicare (Medicare Part A and Medicare Part B). members will still have to pay an IRMAA on their Part B premium, and their Part D premium if they have it.
  • IRMAA surcharges are based on the beneficiary’s tax return submitted two years prior.
  • IRMAA surcharges are not paid to any employer/union coverage. IRMAA surcharges go directly to Medicare.
  • Medicare mail an Initial IRMAA Determination to their qualifying beneficiaries to inform them of the surcharge.
  • Beneficiaries can file an appealAn appeal is an action you can take if you disagree with a coverage or payment decision made by Medicare, your Medicare Advantage plan, or your Medicare Part D plan. if they receive an IRMAA determination that was wrongly calculated. Questions about appeals can be answered by calling Social Security or Medicare.

What is the IRMAA threshold for Part B?

If a beneficiary’s modified adjusted gross income (as reported on their IRS tax return two years ago) is higher than a set amount, they will have an IRMAA surcharge added to their monthly Part B premium. The 2022 standard Part B premium amount is $170.10.1Medicare.gov, “Part B costs“, Accessed November 22, 2021

2022 Part B IRMAA Thresholds

If yearly income in 2020 (for what the beneficiaryA person who has health care insurance through the Medicare or Medicaid programs. pays in 2022) was They pay each month (in 2022)
File individual tax return File joint tax return File married & separate tax return
$91,000 or less $182,000 or less $91,000 or less $170.10 (Standard)
above $91,000 up to $114,000 above $182,000 up to $228,000 Not applicable $238.10 (Standard*1.4)
above $114,000 up to $142,000 above $228,000 up to $284,000 Not applicable $340.20 (Standard*2)
above $142,000 up to $170,000 above $284,000 up to $340,000 Not applicable $442.30 (Standard*2.6)
above $170,000 and less than $500,000 above $340,000 and less than $750,000 above $91,000 and less than $409,000 $544.30 (Standard*3.2)
$500,000 or above $750,000 and above $409,000 and above $578.30 (Standard*3.4)

Do I Have To Pay IRMAA With Medicare Advantage?

Medicare Advantage members with a qualifying income level will have to pay an IRMAA surcharge for their Part B premiums.2Medicare.gov, “Monthly premium for drug plans“, Accessed November 22, 2021

What is the IRMAA threshold for Part D?

Most Part D plans charge a monthly premium that varies by plan. This premium is also subject to IRMAA surcharges based on the beneficiary’s income level. This is included with any IRMAA surcharge for Part B premiums beneficiaries may receive and if they are a Medicare Advantage member with Part D.2Medicare.gov, “Monthly premium for drug plans“, Accessed November 22, 2021

2022 Part D IRMAA Thresholds

If their filing status and yearly income in 2020 was
File individual tax return File joint tax return File married & separate tax return They pay each month (in 2022)
$91,000 or less $182,000 or less $91,000 or less their plan premium
above $91,000 up to $114,000 above $182,000 up to $228,000 not applicable $12.40 + their plan premium
above $114,000 up to $142,000 above $228,000 up to $284,000 not applicable $32.10 + their plan premium
above $142,000 up to $170,000 above $284,000 up to $340,000 not applicable $51.70 + their plan premium
above $170,000 and less than $500,000 above $340,000 and less than $750,000 above $91,000 and less than $409,000 $71.30 + their plan premium
$500,000 or above $750,000 and above $409,000 and above $77.90 + their plan premium

Do I Pay IRMAA To My Employer/Union Coverage?

IRMAA payments are made directly to Medicare and not to any plan or employer. The majority of people have the additional amount taken out of their Social Security checks. Beneficiaries would be billed by Medicare or Railroad Retirement Board if the extra amount isn’t taken out of their Social Security check.2Medicare.gov, “Monthly premium for drug plans“, Accessed November 22, 2021

How Do I Know If I Have An IRMAA?

If a beneficiary has Medicare Part B or Part D, and Social Security determines that IRMAA surcharges are applicable to them, they will receive an Initial IRMAA Determination. This notice provides information on Social Security’s determination as well as their appeal rights.3Medicare.gov, “Initial IRMAA Determination“, Accessed October 21, 2021

Can I Appeal My IRMAA?

If a beneficiary has been notified of an IRMAA surcharge that they believe was wrongly calculated, they can submit an appeal to Medicare. They will have 120 days from when they received the Initial IRMAA Determination to file the appeal.4Medicare.gov, “How do I file an appeal?“, Accessed October 21, 2021

When filing the appeal, the beneficiary must notify Medicare of a “life-changing event” that would have affected their income two years ago. Examples of such events can include getting married, divorced, death of a spouse, job loss, pension loss, or even losing income-producing property.5SSA.gov, “Medicare Income-Related Monthly Adjusted Amount – Life-Changing Event“, Accessed October 21, 2021

What If I Don’t Pay My IRMAA?

Medicare members have an initial grace period of three months before they can be dropped from Medicare if they don’t pay their IRMAA. Medicare will notify the beneficiary’s coverage plan to terminate coverage after three months without payment. The beneficiary will then be issued a notice of disenrollment within ten days.6Medicare.gov, “What Happens When a Plan Member Doesn’t Pay Their Medicare Plan Premiums?“, Accessed October 21, 2021

What If Have Questions About My IRMAA?

Beneficiaries can contact the Social Security Administration if they have any questions about why they are paying an IRMAA at 1-800-772-1213. TTY:1-800-325-0778.6Medicare.gov, “What Happens When a Plan Member Doesn’t Pay Their Medicare Plan Premiums?“, Accessed October 21, 2021

Other questions about a Medicare premium bill can be answered by a Medicare expert at 1-800-MEDICARE (1-800-633-4227). TTY: 1-877-486-2048.6Medicare.gov, “What Happens When a Plan Member Doesn’t Pay Their Medicare Plan Premiums?“, Accessed October 21, 2021

Citations

  • 1
    Medicare.gov, “Part B costs“, Accessed November 22, 2021
  • 2
    Medicare.gov, “Monthly premium for drug plans“, Accessed November 22, 2021
  • 3
    Medicare.gov, “Initial IRMAA Determination“, Accessed October 21, 2021
  • 4
    Medicare.gov, “How do I file an appeal?“, Accessed October 21, 2021
  • 5
    SSA.gov, “Medicare Income-Related Monthly Adjusted Amount – Life-Changing Event“, Accessed October 21, 2021
  • 6
    Medicare.gov, “What Happens When a Plan Member Doesn’t Pay Their Medicare Plan Premiums?“, Accessed October 21, 2021

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