TN 3 (11-10)

HI 01101.031 How IRMAA is Calculated and How IRMAA Affects the Total Medicare Premium

Citations:

Section 1839(i) of the Social Security Act;

CMS regulations, 42 CFR 408.20408.28;

Section 1860D-13(a)(7) of the Social Security Act

A. Policy for Medicare Part B IRMAA calculation

The Centers for Medicare & Medicaid Services (CMS) calculates the Medicare Part B monthly premium amounts and the income-related monthly adjustment amount (IRMAA). CMS publishes the amounts, which can be found in the current Federal Register each year. By law, threshold amounts and modified adjusted gross income (MAGI) ranges are fixed through 2019 and can be found in the same announcement.

For IRMAA beneficiaries, Part B premium surcharges for late enrollment or reenrollment will continue to be calculated based on the Part B standard monthly premium. More information regarding Part B premium surcharge calculations can be found in HI 01001.010.

Part B beneficiaries usually pay about 25% of the true cost for Part B. The true cost of Part B that IRMAA beneficiaries pay is 35% for level 1, 50% for level 2, 65% for level 3, and 80% for level 4.

B. IRMAA Percentage Tables, Medicare Part B Premium Year 2010 (Ranges and Thresholds Will Not Change Through Premium Year 2019)

1. Tax filing status: Single, head of household, married, filing separately (but living apart for the entire year) or qualifying widow(er) with dependent child

Level

If MAGI in tax year 2008 (or 2007, if 2008 was not available) is:

The percentage of the total Part B coverage cost the beneficiary will pay is:

1

More than $85,000 but not more than $107,000

35 %

2

More than $107,000 but not more than $160,000

50 %

3

More than $160,000 but not more than $214,000

65 %

4

More than $214,000

80 %

2. Tax filing status: Married filing jointly

Level

If MAGI in tax year 2008 (or 2007, if 2008 was not available) is:

The percentage of the total Part B coverage cost the beneficiary will pay is:

1

More than $170,000 but not more than $214,000

35 %

2

More than $214,000 but not more than $320,000

50 %

3

More than $320,000 but not more than $428,000

65 %

4

More than $428,000

80 %

3. Tax filing status: Married, filing separately (but lived together at some time during the year)

Level

If MAGI in tax year 2008 (or 2007, if 2008 was not available) is:

The percentage of the total Part B coverage cost the beneficiary will pay is:

3

More than $85,000 but not more than $129,000

65 %

4

More than $129,000

80 %

C. Total Medicare Part B premium

1. Total premium

The total Medicare Part B premium consists of the following:

  • Standard M