UNITED STATES—Hello Toni: I am turning 65 in October, self-employed and my income is over $250K. Recently I received a letter from SSA telling me that my monthly Medicare Part B premium of $170.10 would be doubled to $340.20 per month due to 2020 reported income. That was no surprise, but Social Security also said that the monthly adjustment for prescription drug coverage would be an additional $51.70. What is this all about?
I am in excellent health and take NO prescriptions. What happens if I do not apply for a Medicare prescription drug plan? Do I still have to pay the “extra” $51.70?
What if a person goes the Medicare Advantage route instead of Original Medicare and a Medicare supplement? Do they get to avoid the additional $340.20 per month for Part B and the $51.70 per month extra premium for a Medicare Part D prescription drug plan? Thanks, Mike from Oklahoma City, OK.
Mike: Sorry, Mike but you cannot avoid the additional IRMAA (income related monthly adjusted amount) premiums if your income is above a certain limit no matter if you are enrolled in Original Medicare and a Medicare Supplement or a Medicare Advantage plan with prescription drug. It is going to happen anyway!
If you are not enrolled in a Medicare Part D prescription drug plan, whether stand alone or with a Medicare Advantage plan, you will not receive the addition Part D IRMAA (income related monthly adjusted amount) premium. It is not a wise decision, however, not to enroll in a Medicare Part D plan simply because you are not taking prescriptions at the time you enroll in Medicare.
Social Security bases your income on both you and your spouse (if you are married) whether they are Medicare age or not. The MAGI (modified adjusted gross income) amount that is reported on your yearly income taxes is what triggers the IRMAA (income related modified adjusted amount) increase.
The bottom line is if your income is over these amounts, and you have your Medicare prescription drug plan from either a Medicare Advantage with Prescription Drug Plan (Part C) or Stand-alone Medicare Prescription Drug plan (Part D), you will pay the additional IRMAA premium, whether you are deducting your premiums from your Social Security check or paying direct to Social Security because you have not started receiving your Social Security check.
Remember if you are not enrolled in a Medicare Part D prescription drug plan at the right time, you will not have prescription drug coverage and will receive a Part D late enrollment penalty when you sign up later.
At the Toni Says® office, we advise everyone to enroll in a Part D prescription drug plan whether you are taking no prescriptions or a lot of prescriptions. No one wants an additional penalty.
Enrolling in a Medicare Advantage plan instead of Original Medicare with a Medicare Supplement/Medigap and a Medicare Part D plan does not keep Medicare or Social Security from charging the additional IRMAA premium for both Medicare Parts B and D
The IRMAA Medicare rule went into effect on January 1, 2011, regarding the Medicare Part D additional IRMAA premiums.
Because the yearly Medicare and You Handbook is generally mailed out before October 1 the costs and premiums for Medicare for that specific year are not included. Medicare costs and premiums are typically released around November 10 of each year.
Readers of the Toni Says® Medicare column can visit www.tonisays.com to receive your copy of the current Medicare costs with Medicare Part B and Part D premiums for all income levels and to sign up for the latest Toni Says® newsletter. Email your Medicare questions to email@example.com or call 832-519-8664.