Is Medicare IRMAA a big deal?

[JDARNELL]

If you're irritated at IRMAA or feel it unfair, wait'll y'all see means testing for SS. It'll likely start at the same income altitudes.

Don’t give them any ideas. Of course I am sure this is already on their radar.

 

[MichaelB]

Paying a higher premium is never enjoyable. I try to keep in mind that Medicare is heavily subsidized, and IRMAA is a reduction in the subsidy. Without this subsidy our cost for retiree healthcare insurance with be substantially higher.

 

[Irishgirlyc58]

No way was I going to pay IRMAA. I sent in my letter and followed with tax statements to my local office and IRMAA disappeared. Not sure why anyone would not do this. It was not difficult.

Mine won’t be a one time hit. I receive a pension and can’t modify that.

 

[audreyh1]

Paying a higher premium is never enjoyable. I try to keep in mind that Medicare is heavily subsidized, and IRMAA is a reduction in the subsidy. Without this subsidy our cost for retiree healthcare insurance would be substantially higher.

Correct.

And all those working years were paying towards Medicare Part A, not part B.

 

[athena53]

If you're irritated at IRMAA or feel it unfair, wait'll y'all see means testing for SS. It'll likely start at the same income altitudes.

It's means-tested now. Of every $ I get, 25 cents is clawed back in the form of Federal and State taxes.

 

[Irishgirlyc58]

Saying that people with a specific unmodifiable income are wealthy or well off financially but not having information on their specific finances or expenses is very short sighted.

 

[misanman]

I hear about people engineering their income in order to qualify for ACA. Avoiding IRMAA is sort of the same thing. You just have to engineer your income to avoid it. And while you're at it, you might as well try to engineer your income in order to have long term capital gains and qualified dividends taxed at 0%.

Of course, doing this may be easier said than done, but I'm pleased to be there for 2023 thanks to Roth conversions in prior years.

 

[Car-Guy]

Paying a higher premium is never enjoyable. I try to keep in mind that Medicare is heavily subsidized, and IRMAA is a reduction in the subsidy. Without this subsidy our cost for retiree healthcare insurance with be substantially higher.

I won't ask why US health care cost so much... Better to a degree? "Maybe", but...

 

[calmloki]

My December social security payment was $675.30. Then they deducted $615.60 for Medicare premiums, so my bank account had a nice $59.70 increase each month. I've been tickled to have most of my medical expenses covered - beat the heck out of paying out of pocket for health insurance for years. Pretty quick I'm looking at a raise in the amount sent to me - something like $75/month in spendable money! Is this a great country or what!

 

[Dash man]

Consider doing Roth conversions up to near the next level of IRMAA. It may help keep IRMAA lower in later years. We do large Roth conversions so we can avoid IRMAA in a few years, along with avoiding higher tax brackets.

 

[athena53]

I've been tickled to have most of my medical expenses covered - beat the heck out of paying out of pocket for health insurance for years.

I'll agree with that. I dealt with ACA between ages 61 and 65 and I have better coverage now for less money. And I was fortunate- the ACA policy had a $6,000 deductible but I never had anything more than a few hundred $$$ OOP in any of those years.

 

[youbet]

It's means-tested now. Of every $ I get, 25 cents is clawed back in the form of Federal and State taxes.

I think the point is that SS means testing today (through income taxation) is only a seed of what it will grow into with IRMAA style means testing being implemented sometime in the future.

 

[steelyman]

My December social security payment was $675.30. Then they deducted $615.60 for Medicare premiums, so my bank account had a nice $59.70 increase each month. I've been tickled to have most of my medical expenses covered - beat the heck out of paying out of pocket for health insurance for years. Pretty quick I'm looking at a raise in the amount sent to me - something like $75/month in spendable money! Is this a great country or what!

I’m hoping for something like that. WEP will hit my SS payment (haven’t started yet) and it would be nice if what remains will cover Medicare base + IRMAA.

 

[copyright1997reloaded]

The $124K was paid over roughly 40 years. Most of that time the rate was 1.45% for employees and 1.45% employers. So your total income was roughly $124,000÷.029, or $4.2 million over your career. An extra $5-6K per year can certainly be budgeted by someone who made that much. Medicare coverage is not based on an individual account basis, and neither is health insurance. All the employees in a company may be on roughly the same health insurance plan, whether they be janitors or administrative assistants, or executive. Likewise all Medicare recipients get Medicare.

$124K is not that much to contribute toward health care for the rest of your life. Right now, the cost for one pregnancy, including delivery room and postpartum, is about $17K. Stage III or IV breast cancer treatment is roughly $80K-$150K. Do we want people to go bankrupt paying these costs out of pocket?




I agree with the OP. Compared to my health care premiums when I was young and healthy and even while on the ACA, IRMAA will not be a big deal. If in retirement we have more that $194K in income, we'll pay the premium. Some folks here are complaining about having to pay anything extra because they were blessed with being a high income earner, in a forum with a thread called "Blow That Dough." If you think it is unfair, then please share what you think is fair.

If you are required to pay extra because of IRMAA, count your blessings that you had that level of income two years ago to be required to pay that. The current IRMA brackets are such that even if I had not retired, we would not be faced with paying an additional premium. If you are making that much in retirement...congratulations.

Your post is rather condescending and you have no idea of my financial situation. Yes, I have been blessed but have also worked my a*s off for many years of long hours and time away from family. I could have stayed retired early (like so many here) and played the games to reduce "income" while still having tons of assets but instead went back to work 12 years ago at a much lower salary - partially to give back.

Your math is also incorrect. The 128K doesn't get me health care for the rest of my life - I also need to pay the ongoing Medicare costs, along with copays and deductibles or a Medigap plan cost.

What would be "fair" is a system that doesn't constantly penalize those who save at every turn.

 

[youbet]

My December social security payment was $675.30. Then they deducted $615.60 for Medicare premiums, so my bank account had a nice $59.70 increase each month.

Even better.......

DW sends CMS $71 each month to pay her Part D IRMAA. Then she sends them $5k - $6k each autumn to cover Part B IRMAA and the difference between her monthly SS and her Part B premium.

Generally, we think Medicare and Medicare Advantage are great and have been using them as our primary health insurance for a decade. But it isn't cheap. I have traditional Medicare Part A, Part B, Part D and a type F Select supplement. DW has a Medicare Advantage plan. Our annual cost for premiums and IRMAA is approximately $18k.

No complaints from us. Just a reminder that the cost of health insurance post 65 may not be as low as some anticipate and might need to be planned for.

 

[youbet]

Also no IRMAA on Medigap. Only on Part B and D.

As an additional clarification........ Medicare Advantage participants (Part C) also pay IRMAA which is calculated as though they had Parts B and D.

 

[Gumby]

Once I hit 65 next year, my retiree health deal is that I will go into a no-fee Medicare Advantage PPO and prescription drug plan. My former employer will compensate me for the Part B premiums, and if I hit IRMAA, for those extra premiums as well. Pretty good deal, I think. Way more valuable to me than the miniscule pension I receive.

 

[steelyman]

As an additional clarification........ Medicare Advantage participants (Part C) also pay IRMAA which is calculated as though they had Parts B and D.

That’s because IRMAA applies to “traditional” Medicare only (right?). Advantage and Medigap are separate.

 

[euro]

Does that $1,000 include the Part G Supplement?

Sorry if someone already answered - I'm just now catching up with the thread...

Supplement (Medigap) is not subject to IRMAA. "Just" Part B and D premiums

 

[euro]

Once I hit 65 next year, my retiree health deal is that I will go into a no-fee Medicare Advantage PPO and prescription drug plan. My former employer will compensate me for the Part B premiums, and if I hit IRMAA, for those extra premiums as well. Pretty good deal, I think. Way more valuable to me than the miniscule pension I receive.

Yes, very nice perk! Unfortunately, my megacorp "only" provides a flat fee (a few hundred dollars a year) to compensate for all of that. Alas, better than nothing, I guess.

 

[W2R]

Last year I was paying IRMAA (the first tier only), and as irrational as it may seem to some of you, I *hated* paying it. Logical or not, it felt like I was being robbed every month.

This year, no IRMAA!!! And, like most of us I also get the big COL increase in my SS. So, it's a "double wowie"! It's like Mardi Gras 3x over. Pardon me while I celebrate!

 

[youbet]

That’s because IRMAA applies to Medicare only (right?). Advantage and Medigap are separate.

Medicare Advantage participants pay IRMAA equivalent to being on Parts B and D. It's really just terminology. For example, DW is on Medicare Advantage and I'm on traditional Medicare. We pay exactly the same IRMAA.

Being on Medicare Advantage (part C) does not get you out of IRMAA.

 

[Car-Guy]

Last year I was paying IRMAA (the first tier only), and as irrational as it may seem to some of you, I *hated* paying it. Logical or not, it felt like I was being robbed every month.

This year, no IRMAA!!! And, like most of us I also get the big COL increase in my SS. So, it's a "double wowie"! It's like Mardi Gras 3x over. Pardon me while I celebrate!

You were, and they didn't even use a gun.

 

[W2R]

You were, and they didn't even use a gun.

Sure felt like it! I tried to ignore it but couldn't.

 

[steelyman]

Medicare Advantage participants pay IRMAA equivalent to being on Parts B and D. It's really just terminology. For example, DW is on Medicare Advantage and I'm on traditional Medicare. We pay exactly the same IRMAA.

Being on Medicare Advantage (part C) does not get you out of IRMAA.

Yes. I’m on Advantage too (employer retiree health plan) and pay IRMAA B & D.

I think terminology as it has grown and used is one of the most confusing things about the Medicare adventure.