TN 1 (03-07)

HI 01194.030 Predetermination Notices (Notice Type 520)

A. Purpose/Use

Predetermination notices are mailed after an IRS data exchange indicates a beneficiary will have to pay IRMAA. Predetermination notices are mailed to:

  • Those who have been awarded Medicare entitlement;

  • Through March 2007, to beneficiaries after they attain eligibility for Medicare at age 65 or after 24 months of disability benefits (or would have received 24 months of disability benefits but are MQGE); and

  • Starting April 2007, to beneficiaries two months before they attain eligibility for Medicare at age 65 or after 24 months of disability benefits (or would have received 24 months of disability benefits but are MQGE).

See HI 01101.030 for a description of the IRMAA determination process for Medicare attainers and new filers.

Beneficiaries will be given 10 days following the receipt of the notice to contact us and request a new initial determination if they would like us to use other information (20 day diary from the date that the notice is mailed until SSA starts premium withholding; assumes 5 days mailing to and from). The purpose of the notice is to minimize inappropriate premium withholding by allowing beneficiaries to provide other information before withholding starts. The notice does not have appeal rights.

NOTE: For new filers, SSA will send a T2 Redesign notice to Title II beneficiaries about entitlement to benefits and Medicare premium withholding before the predetermination notice. That notice contains language that tells beneficiaries that if SSA receives information that indicates their income exceeds the high-income threshold, they will receive another letter.

B. Sample Predetermination Notice - T2 Beneficiary - No Request For New Initial Determination

This is a sample of the notice that will be sent to a title II beneficiary who did not request a new initial determination at the time he filed for benefits. In this sample, IRS returned information about the beneficiary’s 2005 tax return. Both a premium surcharge and a Medicare Advantage reduction apply. See HI 01194.030C. for a sample of the notice we send to beneficiaries who request a new initial determination at the time they file their claims.

Social Security Administration

Medicare Part B Premium

Important Information

Return Address
Date
Claim Number: xxx-xx-xxxxA

Beneficiary Name

Beneficiary Address

A Medicare law requires that some people, based on their income, pay higher premiums for their Medicare Part B (Medical Insurance) coverage. We received information about your income from the Internal Revenue Service (IRS) that shows you must pay a higher premium.

If you do not contact us within 10 days after you receive this letter, we will send you another letter which will tell you how you will pay this income-related premium amount.

Based on the information we have, your 2007 monthly Medicare

Part B premium will be: $105.20

  • $93.50 for the standard Medicare premium plus

  • 9.40 for your premium surcharge, plus

  • 12.30 for the income-related premium minus

  • $10.00 for your Medicare Advantage premium reduction.

This change will be effective March, 2007.

How We Decided Your Income-Related Premium Amount

To decide if your income is high enough that you must pay an income-related adjustment, the Internal Revenue Service (IRS) gave us information about your modified adjusted gross income (MAGI) from your income tax return for 2005. MAGI is the sum of your adjusted gross income plus certain amounts of income that are not taxable. For most people, MAGI is the sum of adjusted gross income and tax-exempt interest income on IRS form 1040.

IRS told us your MAGI in 2005 was $85,000. In 2005, you had an adjusted gross income of $82,000 plus tax exempt interest income of $3,000 and you filed your taxes with a tax filing status of Single. We used the following table to decide your income-related adjustment:

If your filing status was:

And your MAGI was:

Then your income-related monthly adjustment amount is:

Single, Head of household or Qualifying widow(er)

$ 80,000.01 - $ 100,000.00

$ 100,000.01 - $ 150,000.00

$ 150,000.01 - $ 200,000.00

More than $ 200,000.00

$ 12.30

$ 30.90

$ 49.40

$ 67.90

Married, filing jointly

$ 160,000.01 - $ 200,000.00

$ 200,000.01 - $ 300,000.00

$ 300,000.01 - $ 400,000.00

More than $400,000.

$ 12.30

$ 30.90

$ 49.40

$ 67.90

Married, filing separately (if you lived apart throughout the year, see below)

$ 80,000.01 - $ 120,000.00

More than $ 120,000.00

$ 49.40

$ 67.90

If You Have Other Information About Your Income

The law permits us to use other information about your MAGI under certain circumstances. If any of the situations in the list below apply or if they occur later this year, you should contact us and explain that you have new information about your Medicare Part B income-related premium. You can call us at 1-800-772-1213 (TTY 1-800-325-0778 for the hearing-impaired) or visit any Social Security office to discuss the following situations:

  • Your MAGI goes down at least one range in the table above and:

    • you marry, divorce, or become widowed; or

    • you or your spouse stop working or reduce your work hours; or

    • you or your spouse lose income from property due to a disaster or other event beyond your control; or

    • you or our spouse’s pension stops or is reduced due to termination of the pension plan.

  • You have an amended tax return for 2005, and your MAGI from your amended tax return is lower than the MAGI information we received from IRS.

You should contact us as soon as you know about any of the situations listed above. We will be able to tell you what kind of evidence you need to give us about the situation and your change in MAGI.

If you believe that the information IRS gave us is incorrect, contact the IRS to get

IRS’s copy of your tax return. You can call us if you have any questions.

If You Have Any Questions

If you have questions about your Medicare coverage, call 1-800-MEDICARE (1-800-633-4273, TTY 1-877-486-2048).

If you have questions about your Medicare Part B premium, please visit www.medicare.gov on the Internet. For general information, you can visit our website at www.socialsecurity.gov. You also can call us at 1-800-772-1213 and speak to a representative from 7 a.m. to 7 p.m. on business days. If you have a touch-tone phone, recorded information and services are available 24 hours a day. We can answer most questions over the phone. If you are deaf or hard of hearing, you can call our TTY number, 1-800-325-0778. You can also write or visit any Social Security office. The office that serves your area is located at:

Address of field office

If you call or visit an office, please have this letter with you. It will help us to answer _ questions. Also, if you plan to visit an office, you may call ahead to make an appointment. This will help us serve you more quickly when you arrive at the office.

(Signature)

Regional Commissioner

C. Sample Predetermination Notice - T2 Beneficiary - Request For New Initial Determination Made at Time of Filing

This is a sample of the notice that we send to a title II beneficiary who reported a life-changing event or new tax information at the time that he/she filed a claim for benefits or Medicare-only. In this sample, the beneficiary also has a reduction in his total Medicare Part B premium due to a Medicare Advantage reduction (SM 03040.335).

Social Security Administration

Medicare Part B Premium

Important Information

Return Address

Date

Claim Number: xxx-xx-xxxxA

Beneficiary Name

Beneficiary Address

A Medicare law requires that some people, based on their income, pay higher premiums for their Medicare Part B (Medical Insurance) coverage. We received information about your income from the Internal Revenue Service (IRS) that shows you must pay a higher premium.

You reported other information to us, which we will use to decide if you must pay a higher premium. If you want to report any changes in the information you gave us, you need to contact us.

Based on the information we have, your 2007 monthly Medicare

Part B premium will be: $115.40

  • $93.50 for the standard Medicare premium plus

  • $30.90 for the income-related premium minus

  • $9.00 for your Medicare Advantage premium reduction.

This change will be effective March, 2007.

How We Decided Your Income-Related Premium Amount

To decide if your income is high enough that you must pay an income-related adjustment, the Internal Revenue Service (IRS) gave us information about your modified adjusted gross income (MAGI) from your income tax return for 2005. MAGI is the sum of your adjusted gross income plus certain amounts of income that are not taxable. For most people, MAGI is the sum of adjusted gross income and tax-exempt interest income on IRS form 1040.

IRS told us your MAGI in 2005 was $340,800.00. In 2005, you had an adjusted gross income of $340,800.00 and you filed your taxes with a tax filing status of Married, filing jointly. We used the following table to decide your income-related adjustment:

You reported an unanticipated loss of pension income. You said that your MAGI will be $220,000.00 in 2007 and that your tax filing status will be Married, filing jointly. We used the following table to decide your income-related adjustment:

If your filing status was:

And your MAGI was:

Then your income-related monthly adjustment amount is:

Single, Head of household or Qualifying widow(er)

$ 80,000.01 - $ 100,000.00

$ 100,000.01 - $ 150,000.00

$ 150,000.01 - $ 200,000.00

More than $ 200,000.00

$ 12.30

$ 30.90

$ 49.40

$ 67.90

Married, filing jointly

$ 160,000.01 - $ 200,000.00

$ 200,000.01 - $ 300,000.00

$ 300,000.01 - $ 400,000.00

More than $400,000.

$ 12.30

$ 30.90

$ 49.40

$ 67.90

Married, filing separately (if you lived apart throughout the year, see below)

$ 80,000.01 - $ 120,000.00

More than $ 120,000.00

$ 49.40

$ 67.90

If You Have Other Information About Your Income

The law permits us to use other information about your MAGI under certain circumstances. If any of