Part B Doctor Visits & D Rx
surcharges for those with high Income
If you earn a lot of money, be thankful. Then open up your wallet as it will cost you a little more for Part B – Outpatient – Doctor Visits and Part D Rx. Medi Gap premiums stay the same. No surcharge for Medicare Advantage, but for the Rx portion. See the chart below and the publications on the right.
Note that MAGI for Social Security is a little different here that from the definition for those under 65 in Obamacare. MAGI is the total of your adjusted gross income [line 8 b 1040] and tax-exempt interest income.
Here’s an Explanation in a Specimen MAPD Evidence of Coverage page 20
Most Medicare beneficiaries pay the standard monthly premium, which is set to cover 25 percent of Part B and Part D program costs, but a relatively small share of beneficiaries (around 6 percent in 2015) with incomes above $87,000 for single people and $174,000 for married couples are required to pay higher premiums for Medicare Part B and Part D—ranging from 35 percent to 80 percent of program costs, that means that your $144/month Part B premium, costs Medicare more than $429/month! and the average $36 Part D premium costs Medicare $112/month, click on footnote KFF.org to view charts! depending on your income (Figure 1). KFF.org
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Part D Rx & B Doctor Visits
Surcharge Chart
We don't always have time to update this chart.
Just click on chart or Medicare Costs Publication #11579 for the latest from Medicare.
Part D
Higher Income Surcharge
Part B Doctor Visits
Higher Income Surcharge
Related Pages
Be sure to follow all the links & footnotes above
I’ll be turning 65 soon and earn over $500k.
How might it work if I just stay on Blue Shield Silver PPO?
See our webpages on:
Part B late enrollment penalty
Medicare & Dual Coverage
Blue Shield under 65 webpage
Blue Shield Silver 70 PPO EOC Evidence of Coverage
Blue Shield under 65 EOC Limitation for duplicate coverage Medicare
Blue Shield’s rate chart doesn’t charge extra for being over 65. Silver 70 PPO Santa Barbara Region 12 is $1,240.95 for 64+
If you are only a high earner for 2020, see the Plain English explanation we answered for another website visitor, about it taking two years for your tax return to show.
Check out about asking for a Waiver. See FAQ above on annual verification in the box with the rules for high income beneficiaries.
So, if you wait to sign up… Then you’ll have the Part B late enrollment penalty and you can only sign up at certain times.
Where does one get the bill for the higher amount?
From Medicare?
Medi Gap?
Medicare Advantage?
Prescription Company?
The standard Part B premium amount in 2021 is $148.
Most people pay the standard Part B premium amount. If your modified adjusted gross income as reported on your IRS tax return from 2 years ago is above a certain amount, you’ll pay the standard premium amount and an Income Related Monthly Adjustment Amount (IRMAA).
IRMAA is an extra charge added to your premium. https://www.medicare.gov/your-medicare-costs/part-b-costs
Part D Rx
If you have a higher income, you might pay more for your Medicare drug coverage. If your income is above a certain limit ($87,000 if you file individually or $174,000 if you’re married and file jointly), you’ll pay an extra amount in addition to your plan premium (sometimes called “Part D-IRMAA”). You’ll also have to pay this extra amount if you’re in a Medicare Advantage Plan that includes drug coverage. This doesn’t affect everyone, so most people won’t have to pay an extra amount. If you have Part B and you have a higher income, you may also have to pay an extra amount for your Part B premium, even if you don’t have drug coverage. The chart below lists the extra amount costs by income.
Social Security will contact you if you have to pay Part D IRMAA, based on your income. The amount you pay can change each year. If you have to pay a higher amount for your Part D premium and you disagree (for example, if your income goes down), use this form to contact Social Security [PDF, 125 KB]. If you have questions about your Medicare drug coverage, contact your plan.
Note
The extra amount you have to pay isn’t part of your plan premium. You don’t pay the extra amount to your plan. Most people have the extra amount taken from their Social Security check. If the amount isn’t taken from your check, you’ll get a bill from Medicare or the Railroad Retirement Board. You must pay this amount to keep your Part D coverage. You’ll also have to pay this extra amount if you’re in a Medicare Advantage Plan that includes drug coverage. https://www.medicare.gov/drug-coverage-part-d/costs-for-medicare-drug-coverage/monthly-premium-for-drug-plans
Question
Why do I have to pay so much for Medicare Part B Doctor Visits?
I worked hard for over 40 years and paid taxes for it!
Our Reply
The Monthly premiums for Part B Dr. Visits and Part D Rx Prescriptions for most people on Medicare only pays 1/4 of what Medicare pays out! That just doesn’t hold up considering Medical Loss Ratio, where Insurance Companies & Government need to take in a dollar to pay out 80c.
Kaiser Foundation on high income surcharges KFF.org
See also our webpage section on how Medicare is funded.
Please look at this bill.
Do I have hospitalization with Medicare and
is Part D for prescriptions which I also have with United Healthcare?
See our excerpts of 2020 Medicare Costs above and you’ll see that the $70 charge on part D Rx along with the $462 charge on Part B Doctor Visits is because you are fortunate to earn over $163k
I can’t tell from this bill if you have Medicare Part A Hospital. There is generally no charge for Part A if you worked and paid into Medicare for 10 years.
Take a look at your Medicare ID Card and that will tell you if you have Part A. Also, we wouldn’t be able to get you a Medi Gap Plan or Medicare Advantage unless you had both.
Check out our webpage on getting a Medicare and Social Security Account, so that you can check with the government directly on what your benefits, claims and payments are.
The $70 surcharge is for Part D. Thanks for sending the bill. I was under the impression that the surcharge was billed by what ever company you had your prescription coverage with. Maybe it’s only the surcharge if you didn’t buy prescription coverage when you were supposed to.
Here’s our webpage on what Medicare A & B Cover. You can also check out Medicare and You above and for Rx that guide too above.
Here’s our webpage on what Blue Cross Medi Gap Plans pay in addition to Medicare.
United Health Care doesn’t allow us to post their brochures. I’ve sent those to you via email.
I’m married and my income for 2019 will be under $170k, how and when can I get the surcharge taken off?
Plain English from Kiplinger.com
What year’s income is used?
The surcharge is based on income from your tax return two years ago—the most recent IRS data the government has when premiums are set in late fall. To determine 2017 premiums, for instance, income reported on your 2015 return filed in early 2016 was used. If your income exceeded the thresholds in 2016, you’ll probably owe the surcharges in 2018, and so on.
What if my income has gone down?
That’s the reason for the word probably in the previous answer. If you got hit with the surcharge this year, but your income has fallen since 2015, you may qualify for a waiver. If you experienced a qualifying “life-changing event,” you can easily get the surcharge waived—but you have to ask. Those events include retirement, divorce or death of a spouse. https://www.kiplinger.com/article/retirement/T039-C000-S004-medicare-surcharges-have-costly-effects.html
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Our research on “Official” Sites
It appears to be as soon as you file a tax return with the lower figure.
How does Social Security determine if I must pay higher premiums?
To determine if you’ll pay higher premiums, Social Security uses the most recent federal tax return the IRS provides to us.
Actual CFR Code of Federal Regulations https://www.law.cornell.edu/cfr/text/20/part-418/subpart-B
(a) In general, we will use your modified adjusted gross income provided by IRS for the tax year 2 years prior to the effective year of the income-related monthly adjustment amount determination. Modified adjusted gross income is based on information you provide to IRS when you file your Federal income tax return. 418.1135
If your income has gone down, however, due to certain specific circumstances, or if you filed an amended tax return, you can ask for a new decision without having to file an appeal. https://www.ssa.gov/pubs/EN-05-10125.pdf
Request for Reconsideration https://www.ssa.gov/forms/ssa-561.pdf
See also link for Medicare & You in upper side panels
I just retired and was earning enough to get the highest surcharge – IRMAA income-related monthly adjustment amount.
Why does Medicare use income from my tax return filed in 2016 – 2 years prior.
How to I get the surcharge to be lower now that I’m retired?
Medicare uses the most recent tax return that the IRS provides to them. So, it’s now May 2018. 2017 was only due 2 weeks ago, thus 2016 would be the return provided to Medicare.
Here’s the form to let Medicare know that you’ve retired and have a lower income https://www.ssa.gov/forms/ssa-44-ext.pdf
Please review the Medicare Rules for high income individuals publication for more details and information
What do you expect your 2018 MAGI Income total adjusted gross income and tax-exempt interest income to be?
Check out this article for more information –
https://www.forbes.com/2009/11/05/medicare-options-seniors-personal-finance-premiums.html#3210c63b625d
https://www.ssa.gov/pubs/EN-05-10125.pdf
Why did I receive another letter about my income-related monthly adjustment amounts for Medicare premiums for this year?
You received another letter from Social Security because your income-related monthly adjustment amounts for this year changed. Social Security usually uses two-year-old data that the Internal Revenue Service (IRS) provides to us to determine your income-related monthly adjustment amounts. In some situations, we use three-year-old data, or we base our decision on tax information you provided.
We use your modified adjusted gross income (MAGI) from your federal income tax return to determine your income-related monthly adjustment amounts. Your MAGI is the total of your adjusted gross income and tax-exempt interest income. Note that this definition of MAGI is different for Covered CA Subsidies.
https://www.ssa.gov/pubs/EN-05-10507.pdf