New Medicare Premium Brackets--2018

[nwsteve]

Another very useful article from Michael Kites. This article covers a significant lowering of thresholds (increase premiums) for the upper brackets for determining the high earners Medicare premium surcharges.
From the article "For those who were previously in the 2nd or 3rd IRMAA tiers, though, the impact is even more substantial, as they will effectively be shifted up an entire tier, boosting the IRMAA surcharge from $133.90/month (IRMAA Tier 2 in 2017) to $214.30/month (the next tier up in 2018), or from $214.30/month (the third tier in 2017) to $294.60/month (the top tier in 2018). This amounts to a nearly $1,000/year increase in IRMAA surcharges!"

Entire article is here:
https://www.kitces.com/blog/irmaa-m...ail&utm_term=0_4c81298299-f83f0db3d1-57035433.
For those facing RMA's next years, some important info for planning your 2018 and beyond income strategies.

 

[audreyh1]

Yep, for those high annual income folks.

I’m working hard to reduce annual income from 2018 and beyond as DH is eligible for Medicare in 2020.

Starting at $214K MFJ, every ~$50K of additional annual income results in ~$100 more in monthly combined Part B and Part D surcharges ($1200 per person per year), and it’s a step function, not gradual. $1 over in MAGI and you are paying the higher premium.

The premium jump between $214K and $267K is not as steep - combined $67 per person per month.

But if your annual income is below $200K, no worries. It’s probably a small group of retired 65+ folks with above $200K income. These high income folks are never held harmless either.

 

[audreyh1]

OK - answered one question sort of. IRMAA surcharges projected to affect fewer than 5% of Medicare enrollees even with the surcharge thresholds frozen (not inflation adjusted) until 2019.

The annual MAGI thresholds for IRMAA Medicare Premium surcharges are adjusted annually for inflation, although under the Affordable Care Act, the inflation adjustments to the MAGI thresholds were frozen in place from 2011 to 2019. As a result, the impact of inflation on household incomes itself will cause at least some people to creep into a higher IRMAA tier, although overall the IRMAA surcharges are still projected to impact fewer than 5% of Medicare enrollees.