2009 Income Related Monthly Adjustment Amount (IRMAA)

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2009 Income Related Monthly Adjustment Amount (IRMAA)

The Medicare Part B premium published by the Centers for Medicare & Medicaid Services (CMS) in September of each year represents approximately 25% of the full cost of Part B medical coverage.

The Federal Government subsidizes approximately seventy five percent of the cost for Medicare Part B from General Revenue Funds.

Most people will continue to pay 25% of the cost of Medicare Part B.

Effective January 2007, individuals affected by IRMAA, pay a larger percentage of the cost for Medicare Part B and the Federal Government pays a reduced percentage of the total cost. The amount of your modified adjusted gross income (MAGI) determines the amount of your Part B premium.

In general, the higher your MAGI, the higher your premium.

Premium surcharges for late enrollment or reenrollment will continue to be calculated based on the standard 25% Part B monthly premium.

The government will phase in the Medicare Part B premium due to IRMAA over a three-year period. Effective January 2007, 33 percent of the IRMAA premium increase amount will apply, 67 percent will apply effective January 2008, and 100 percent effective January 2009.

See the following chart showing the amount of the Medicare Part B premium for 2009.

2009 IRMAA Chart to Determine Amount of Medicare Part B Premium
Based on Modified Adjusted Gross Income (MAGI)

Tax Filing Status: Single, Head of Household or Qualifying Widow or Widower with a Dependent Child If your modified adjusted gross income (MAGI) on your 2007 tax return (or 2006, if 2007 was not available) was:	Then the Part B Premium is: (The amount below includes the base premium)
More than $85,000 but less than or equal to $107,000	$134.90
More than $107,000 but less than or equal to $160,000	$192.70
More than $160,000 but less than or equal to $213,000	$250.50
More than $213,000.00	$308.30
Tax Filing Status: Married, Filing Jointly If your modified adjusted gross income (MAGI) on your 2007 tax return (or 2006, if 2007 was not available) was:	Then the Part B Premium is:
More than $170,000 but less than or equal to $214,000	$134.90
More than $214,000 but less than or equal to $320,000	$192.70
More than $320,000 but less than or equal to $426,000	$250.50
More than $426,000.00	$308.30
Tax Filing Status: Married, Filing Separately If your modified adjusted gross income (MAGI) on your 2007 tax return (or 2006, if 2007 was not available) was:	Then the Part B Premium is:
More than $85,000.00 but less than or equal to $128,000.00	$250.50
More than $128,000.00	$308.30

Example:

An Individual who is unmarried and has a modified adjusted gross income of $163,000.00 would pay a Part B premium amount of $250.50.

Medicare uses your income for the year 2007 to determine the premium you pay for 2009. You may only use a more current year of income to determine the premium you pay, if you have a life-changing event.

Examples of life changing events:

1. Death of Spouse
2. Marriage
3. Divorce or annulment
4. Work Reduction
5. Work Stoppage
6. Reduction in income due to loss of income-producing property
7. Reduction in or loss of certain forms of pension income

Examples that are not life-changing events:

Loss of dividend income
Higher Medical expenses
Higher Living expenses
Loss of Child Support
Loss of Alimony
Voluntary Sale of income-producing property

There will be situations where you may have a one-time event causing an increase in your income for the tax year Social Security is using to impose IRMAA. This type of event would not be considered a life-changing event.

Examples of one-time income that cause an increase and are not life-changing events:

Capital Gains from the Sale of Property
Lottery Winnings
Casino Winnings
Conversion of an IRA
Cashing bonds
Stock options

If you have a life-changing event, you should ask Social Security for a new initial determination. This means they would use a more current year of income if it would lower the amount of your premium due to IRMAA.