IRMAA’s Rise
IRMAA’s Rise
Higher income retirees cannot be faulted for thinking that Washington has a hand in their pocket. In 2018, the Medicare Access And CHIP Reauthorization Act lowered the threshold on which Medicare recipients pay an income-related monthly adjustment amount (IRMAA) to their Medicare Part B premiums. Previous to this year, the highest premium kicked in for individuals with $214,000 a year; in 2018, the threshold goes down to $160,000, at which point the monthly cost goes up almost $300 over what less-wealthy people are required to pay.
The new Bipartisan Budget Act of 2018 added a new surcharge for a new income tier; individuals earning more than $500,000, or joint filers earning more than $750,000. Their surcharge goes up to $321.40, above the $134.00 monthly premium. With two increases in two years, you can see where older Americans in they higher income brackets are destined to be paying roughly what they would in the private markets for their health insurance coverage.
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Post by Bob Veres
Bob Veres, a Financial Planning columnist in San Diego, is publisher of Inside Information, an information service for financial advisors.
