How high income affects your Medicare coverage

Published by Mike Lovell on February 5, 2020February 5, 2020

The premium you pay for your Medicare Part B coverage can vary based on income.  Many people are surprised to hear this but it’s true.  If your income is considered to be high, then you could pay an additional amount called IRMAA.  Or if your income is considered to be low, then you could get assistance to reduce the amount you pay.

IRMAA

Did you get a letter from Medicare telling you that your Medicare Part B premium is going to be adjusted?

There’s a good chance you are being impacted by IRMAA.  IRMAA stands for Income Related Monthly Adjustment Amount.  Roughly 7% of people on Medicare are impacted by IRMAA causing them to pay a higher premium than most people.

There are two ways IRMAA can impact you.  The first is for your Medicare Part B premium.  The second is for your Medicare Part D drug coverage.

Medicare Part B Premium

The standard Medicare Part B premium for 2020 is $144.60.  If you are being impacted by IRMAA, your premium will be higher.  How much higher depends on how high your income is.

Here is a chart showing the monthly premiums based off your income.

The higher the income, the larger amount you will pay based off IRMAA.

IRMAA looks at your income from 2 years ago.  Your Modified Adjusted Gross Income (MAGI) is what is used to calculate if your income qualifies you as one of the IRMAA brackets.

So if you are being impacted by IRMAA in 2020, the income being considered for you is from 2018.

Many people’s incomes have changed since then.  Especially if you are retiring this year as you start Medicare.  If this sounds like you, I have good news.

Appeals and Life Changing Events

If you retired and your income has decreased then you can complete the Life Changing Event form to request your IRMAA be reviewed.  You can get a copy of that form here – Life Changing Event form

That is the most common form used for IRMAA reconsideration.  But depending on your situation, there may be others.

Medicare Part D

Your income also impacts the premium you pay for Medicare Part D.  Medicare Part D is also known as your prescription drug plan.

If you are impacted by IRMAA for Medicare part B then you are also most likely going to be impacted for part D.  The good news is that the impacts for your Part D coverage are smaller.

Here is a chart reflecting the impacts to your Medicare part D based on your income:

Some people have purchased a $0 Medicare Advantage plan that includes prescription drug coverage.  If you are impacted by IRMAA then you can still get that plan.  But you will have an additional premium to pay based on the chart above.

What’s next?

Are you being impacted by IRMAA and aren’t sure what your next step is?  Please call me at 608-571-4461 so I can make this process easier for you.

Big life changes are already stressful enough.  And helping people with IRMAA is a free service I provide to all my clients.

Mike Lovell
Call me at 608-571-4461

Or you can request help from directly here.