The monthly premiums that Medicare Part B enrollees will pay during 2021 has been recently announced by the Centers for Medicare and Medicaid Services (CMS). As explained below, the amount of the Part B monthly premiums that an enrollee will pay during 2021 depends on the enrollee’s 2019 modified adjusted gross income (MAGI), as calculated from their 2019 Individual Income Tax Return. In general, the higher one’s MAGI, the larger one’s monthly Part B premium.
The Medicare Part B monthly premiums that medicare enrollees will pay in 2021 are presented in the table below:
Note that the standard Medicare Part B monthly premium amount in 2021 is $148.50. Most individuals enrolled in Part B will pay the standard Part B monthly premium amount during 2021. But if an individual’s 2019 MAGI is above a certain amount, the individual will pay the standard monthly premium amount and an Income Related Monthly Adjustment Amount (IRMAA). IRMAA is an extra charge added to an individual’s standard premium amount as a result of the individual’s higher income from two years ago.
If IRMAA applies to a current Medicare Part B enrollee, then a letter outlining the additional cost will be sent by the Social Security Administration (SSA) to the enrollee during November or early December. The enrollee can appeal the additional Medicare Part B monthly premium cost due to IRMAA.
The biggest reason for appealing an IRMAA letter is because a person’s income has decreased due to certain life-changing events during the past two years. For example, a Medicare Part B enrollee’s IRMAA surcharges applied to 2021 Medicare Part B premiums should not apply because there has been a significant decrease in the person’s total income between 2019 and 2021.
Those persons who are currently enrolled in Medicare Part B and who want to appeal their Part B premiums for 2021 should use Form SSA-44 (Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event) to request a reconsideration using current income. SSA Form-44 can be downloaded at https://www.ssa.gov/forms/ssa-44-ext.pdf.
The SSA lists eight life-changing events that may qualify a person enrolled in Medicare Part B for reconsideration of the IRMAA, perhaps resulting in no IRMAA. These life-changing events include:
(3) Death of a spouse;
(4) Work stoppage;
(5) Work reduction;
(6) Loss of income-producing property (not due to a sale or transfer of the property);
(7) Loss of pension income; and
(8) Employer settlement payment (due to an employer’s bankruptcy or reorganization).
Another event that could be a basis for appealing an IRMAA letter would be a “one-time windfall of income” such as winning the lottery. This may result in a successful IRMAA appeal citing a “one-time windfall” as the reason on Form SSA-44.
How DHJJ Financial Advisors Can Help
If you have questions regarding a 2021 IRMAA Medicare Part B premium surcharge notice, please contact your DHJJ Financial Advisor at 630-420-1360 or fill out the form below. You may also request an adjustment by submitting SSA Form-44 or calling your local Social Security office at 800-772-1213.