Everything You Need to Know About IRMAA
The Income-Related Monthly Adjustment Amount (IRMAA) is a surcharge on Medicare Part B and Part D premiums for people with higher incomes. IRMAA is designed to help offset the cost of Medicare for people with lower incomes.
Who is subject to IRMAA?
IRMAA applies to Medicare beneficiaries who have an income (as defined by the Social Security Administration) above a certain level. The income thresholds are different for individuals and married couples. For 2023, the income thresholds are as follows:
- Individuals: $97,000
- Married couples: $194,000
How is IRMAA calculated?
IRMAA is calculated based on your income from two years prior. For example, your IRMAA surcharge for 2023 will be based on your income from 2021.
The IRMAA surcharge is added to your Medicare Part B and Part D premiums. The amount of the surcharge varies depending on your income and the type of Medicare plan you have.
How to pay IRMAA
IRMAA is paid along with your Medicare Part B and Part D premiums. You can pay your premiums online, by phone, or by mail.
The only way to avoid IRMAA is to have an income below the IRMAA thresholds. However, there are a few ways to reduce your IRMAA surcharge:
- Delay enrollment in Medicare Part B. If you are still working and have health insurance through your employer, you may be able to delay enrollment in Medicare Part B without penalty. However, if you go 63 days or more in a row without creditable coverage or other Medicare drug coverage, you may have to pay a late enrollment penalty if you sign up for Medicare drug coverage later.
- Enroll in a Medicare Advantage plan. Medicare Advantage plans are offered by private insurance companies and typically have lower premiums than Original Medicare. However, Medicare Advantage plans may have higher deductibles and coinsurance costs than Original Medicare.
- Apply for Medicare Savings Programs. Medicare Savings Programs are designed to help people with limited income and resources pay for their Medicare premiums and deductibles. You can learn more about Medicare Savings Programs on the Medicare website or by calling Medicare at 1-800-MEDICARE (1-800-633-4227).
IRMAA can be a significant financial burden for Medicare beneficiaries with higher incomes. However, there are a few ways to reduce your IRMAA surcharge or avoid IRMAA altogether. If you have questions about IRMAA, talk to a Medicare counselor. They can help you understand your options and choose the best Medicare plan for your needs.