Effective Dates: 12/04/2024 - Present Previous | Next

TN 32 (12-24)

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 408.20 – 408.28;

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.

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, 80% for level 4, and 85% for level 5.

B. IRMAA Percentage Tables, Medicare Part B Premium Year 2025

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

Level	If MAGI in tax year 2023 (or 2022, if 2023 was not available) is:	The percentage of the total Part B coverage cost the beneficiary will pay is:
1	More than $106,000 but not more than $133,000	35 %
2	More than $133,000 but not more than $167,000	50 %
3	More than $167,000 but not more than $200,000	65 %
4 5.	More than $200,000 but less than $500,000 $500,000 or more	80% 85%

2. Tax filing status: Married filing jointly

Level	If MAGI in tax year 2023 (or 2022, if 2023 was not available) is:	The percentage of the total Part B coverage cost the beneficiary will pay is:
1	More than $212,000 but not more than $266,000	35 %
2	More than $266,000 but not more than $334,000	50 %
3	More than $334,000 but not more than $400,000	65 %
4 5.	More than $400,000 but less than $750,000 $750,000 or more	80 % 85%

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

Level	If MAGI in tax year 2023 (or 2022, if 2023 was not available) is:	The percentage of the total Part B coverage cost the beneficiary will pay is:
4 5	More than $106,000 but less than $394,000 $394,000 or more	80% 85%

Level

If MAGI in tax year 2023 (or 2022, if 2023 was not available) is:

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

More than $106,000 but less than $394,000

$394,000 or more

80%

85%

C. Total Medicare Part B premium

1. Total premium

The total Medicare Part B premium consists of the following:

•

Standard Medicare Part B premium, plus
•

Late filing surcharges for Medicare Part B (applied to the standard premium, but not to the IRMAA), plus
•

IRMAA, minus
•

Any reduction in the Medicare Part B premium due to enrollment in a Medicare Advantage plan (Part C) which offers a reduction in the Part B premium amount as a benefit (Medicare Advantage Reduction (MARD)). More information regarding the Medicare Advantage (MA) program can be found in HI 00208.066.

NOTE: Beneficiaries who pay IRMAA lose variable SMI premium protection.

2. Examples

a. Example 1 – no surcharge or MA reduction


$185.00	Standard premium for 2025
+$295.90	Part B IRMAA – Level 3
$480.90	Total Medicare Part B premium

b. Example 2 – surcharge and MA reduction


$185.00	Standard premium for 2025
+ $18.50	10% late filing surcharge
$203.50
+$295.90	Part B IRMAA – Level 3
$499.40
- $70.00	MA Reduction (estimate)
$429.40	Total Medicare Part B premium

D. Policy for Medicare prescription drug coverage IRMAA calculation

CMS also calculates IRMAA amounts for prescription drug coverage based on the Medicare base beneficiary premium. Once the IRMAA calculations are done, CMS notifies the Social Security Administration (SSA) so we can make IRMAA determinations.

CMS also calculates premium surcharges for late enrollment or reenrollment based on the base beneficiary premium.

To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0601101031

HI 01101.031 - How IRMAA is Calculated and How IRMAA Affects the Total Medicare Premium - 12/04/2024
Batch run: 12/04/2024
Rev:12/04/2024

Program Operations Manual System (POMS)