Currently, the 2021 Medicare Part B premium is $148.50. That is the amount that most people pay for their Part B. However, for folks with incomes in excess of $88,000, premium amounts range from $207.90 to $504.90. This excess premium is referred to as IRMAA (Income-Related Monthly Adjusted Amount).
The chart below is from https://www.medicare.gov/your-medicare-costs/part-b-costs
This excess premium is based on your income from 2 years prior (so for 2021, your yearly 2019 income would determine your Part B premium). In some instances, an individual’s income may remain in excess of $88,000/year and warrant the extra premium. However, often times the income from 2 years prior is not an accurate reflection of the individual’s current income. Below are several examples
- Getting married, divorced, or losing a spouse
- Loss or sale or income-producing property
- You or your spouse retired and/or income significantly decreased
- Loss of pension income
Medicare bases your IRMAA on your Modified Adjusted Gross Income (MAGI). It’s important to consult with your tax advisor to help you determine your MAGI. For 2021, the Centers for Medicare/Medicaid Services (CMS) will look at lines 2b and 11 of the IRS form 1040.
If you are being assessed an IRMAA and feel that you should not be, you have the ability to appeal the higher premium. FORM SSA-44 “Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event” is the form to complete if you are appealing your IRMAA or if you have experienced a life event that resulted in a substantial decrease in your income. You will also need to provide your most recent tax returns for verification. You can also schedule an appointment at your local Social Security Office or call 800-727-1213.
The FORM SSA-44 is very straightforward. There are only 3 sections to complete as well as providing your name, address, social security number, and your signature.
When you receive your decision, if you are still not satisfied with the outcome, you have the right to request that your appeal be reviewed further. Appeals Process Chart.
If you appeal your IRMAA surcharge, you will need to continue paying the higher premium until you are notified that your premium has been adjusted.