Paying Your Medicare Part D – IRMAA. What is it and what do you need to know?
A higher household income may mean a higher premium
You’ve done your research, enrolled in a Medicare Part D plan, and figured out your monthly premium payment. All set? Maybe not.
Some people enrolled in a Medicare prescription drug plan may have to pay an additional premium each month called the Part D Income-Related Monthly Adjustment Amount (IRMAA). The Part D – IRMAA premium is based on the income you reported on your taxes for the last 2 years. If your income was greater than $85,000 annually as an individual (or married and filing separately) or greater than $170,000 as a married couple filing jointly, you will have to pay a Part D – IRMAA premium.
How Much Is the Part D – IRMAA Premium?
If you meet the income threshold, you should receive a notice from Social Security or the U.S. Railroad Retirement Board with the additional amount you will owe each month. This additional premium is unavoidable, and it’s important to know if it applies to you so you can be prepared to pay it.
Social Security, not Medicare, calculates the Part D – IRMAA premium you may need to pay, based on reported income. The current minimum Part D – IRMAA premium is $12.70 per month, while the maximum is $72.90. These premium costs increased about 3% in 2015. However, they won’t change again until 2019, when they’ll be adjusted for inflation. If you’re enrolling in a Part D plan for 2016, your 2014 and 2015 income levels will be used to determine if you need to pay a Part D – IRMAA premium.
Paying for Part D – IRMAA
- Social Security will automatically deduct this premium from your monthly benefit check if there is enough money to cover the amount.
- If you receive a bill for a Part D – IRMAA premium payment, you must pay it directly to Medicare.
- Do not send a Part D – IRMAA premium payment to your Part D plan.
- If your employer plan covers your Part D plan premium, it will not include the Part D – IRMAA premium because your employer can’t pay it for you. You must pay this premium directly to Medicare. However, your employer may reimburse you for the cost of the premium.
Remember, if you fall below the income threshold, you’ll no longer need to pay the Part D – IRMAA premium.You can find out more about Part D premiums, including Part D – IRMAA, on the Medicare website.
Don’t Delay – It’s Important to Pay
If you accidentally miss a payment, Medicare does provide an initial 3-month grace period to pay your Part D – IRMAA premium for the months you missed payment. That said, if you don’t pay this additional premium after that 3-month period, Medicare will disenroll you from your Part D plan or Employer Group Waiver Plan (EGWP) and you would need to request reinstatement for good cause.
You can request reinstatement in your plan for good cause only if you do so within 60 days of the disenrollment effective date. Reinstatement is granted in rare situations where you were unable to make the payment due to circumstances outside your control. You must also have the documentation to prove it. If your request for reinstatement is approved, your coverage will continue uninterrupted.
If you are disenrolled for failure to pay your Part D – IRMAA premiums, you can ask for reinstatement within 60 days of the disenrollment effective date if you:
- Pay your outstanding premiums to Medicare immediately.
- Contact Medicare at 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048. Request reinstatement in the plan from which you were disenrolled.
If you don’t request reinstatement within 60 days of your disenrollment date, you will have to wait for a valid enrollment period to re-enroll. Please note: If you don’t have other creditable prescription drug coverage for 63 or more days, you may also be required to pay a late enrollment penalty (LEP) if you join a Part D plan later. You will pay the LEP for as long as you have Part D coverage. So do your best to pay both your plan premium and Part D – IRMAA premium by their due dates.
For more information about Part D – IRMAA, contact your Part D plan or call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.