If you are paying IRMAA (the Income-Related Monthly Adjustment Amount
), this means that, based on your income, you will pay higher premiums for your Medicare Part B and Medicare Part D coverage.
As noted by the Social Security Administration:
If you have higher annual income [modified adjusted gross income (MAGI
)], you will pay an additional premium amount for your Medicare Part B (out-patient care) and your Medicare Part D prescription drug plan coverage. The Social Security Administration calls the additional monthly premium amounts the "income-related monthly adjustment amount" or IRMAA.
Here is how IRMAA works:
Medicare Part B IRMAA
- Medicare Part B helps pay for your doctors’ services and outpatient care. It also covers other medical services, such as physical and occupational therapy, and some home health care. For most beneficiaries, the government pays a substantial portion—about 75 percent—of the Part B premium and the beneficiary pays the remaining 25 percent.
If you are a higher-income beneficiary, you will pay a larger percentage of the total cost of Part B based on the income you report to the Internal Revenue Service (IRS). You will pay monthly Part B premiums equal to 35, 50, 65, or 80 percent of the total cost, depending on what you report to the IRS.
Medicare Part D IRMAA
- Medicare Part D prescription drug coverage helps pay for your prescription drugs. For most beneficiaries, the government pays a major portion of the total costs for this coverage and the beneficiary pays the rest. Prescription drug plan costs vary depending on the chosen Medicare Part D plan, and on whether you qualify for the financial Extra Help program that pays a portion of the Medicare Part D prescription drug coverage costs (monthly premiums and drug costs) for lower income Medicare beneficiaries. (Click here to read more about the Extra Help program.)
If you are a higher-income beneficiary with Medicare Part D prescription drug coverage (a stand-alone PDP
or an MAPD
you will pay monthly premiums plus an additional amount, which is based
on the annual income you report to the IRS. Because individual
Medicare Part D plan premiums vary, the law specifies that the amount is
determined using one base premium (click here to see more about the base premium
The Social Security Administration calculates the additional amount you
pay for your Medicare Part D premium to the base Medicare Part D
beneficiary premium, not the premium of your chosen Medicare Part D
If you are a higher-income beneficiary, Social Security deducts the
IRMAA from your monthly Social Security payments regardless of how you
ordinarily pay your monthly Medicare Part D prescription drug plan
premiums. If the amount of your IRMAA is greater than your monthly
payment from Social Security, or you do not get monthly payments, you
will get a separate bill from another Federal agency, such as the
Centers for Medicare & Medicaid Services (CMS) or the Railroad
Question: Which tax return is used to determine your IRMAA liability?
Your most recent tax returns are usually used to calculate IRMAA.
For example, your 2023 IRMAA is determined using your 2021 income (MAGI)
as reported on your 2022 taxes. For more information, please see: "Which
Federal income tax return is used by the Social Security Administration
to determine whether I have an income-related monthly adjustment amount
for my Medicare Part B and Medicare Part D?
Question: Can I appeal my IRMAA assessment?
Please see: "What
can I do if I do not agree with the Social Security Administration's
income-related monthly adjustment amount or IRMAA assessment?