Insurance & Risk Management

Medicare Part B and Part D Premium Adjustments for 2022

Medicare Part B premiums are automatically deducted from Social Security, Railroad Retirement Board, and Office of Personnel Management payments. The standard Medicare Part B premium is adjusted based on a taxpayer’s Modified Adjusted Gross Income (MAGI). MAGI for Medicare purposes is the taxpayer’s AGI plus any tax-exempt interest. Medicare uses a taxpayer’s MAGI from two years prior to determine any premium adjustment. For example, the MAGI from the 2020 tax return will determine 2022 Medicare premiums.

The standard Part B premium amount in 2022 is $170.10. Based on a taxpayer’s Modified Adjusted Gross Income, they may be required to pay an Income Related Monthly Adjustment Amount (IRMAA) on their Part B premium. MAGI thresholds and the associated Part B IRMAA is shown in the table below for each tax filing status:

If your yearly income in 2020 (for what you pay in 2022) was

You pay each month (in 2022)

File individual tax return

File joint tax return

File married & separate tax return

$91,000 or less

$182,000 or less

$91,000 or less

$170.10

above $91,000 up to $114,000

above $182,000 up to $228,000

Not applicable

$238.10

above $114,000 up to $142,000

above $228,000 up to $284,000

Not applicable

$340.20

above $142,000 up to $170,000

above $284,000 up to $340,000

Not applicable

$442.30

above $170,000 and less than $500,000

above $340,000 and less than $750,000

above $91,000 and less than $409,000

$544.30

$500,000 or above

$750,000 or above

$409,000 or above

$578.30

(https://www.medicare.gov/your-medicare-costs/part-b-costs)

At open enrollment, Medicare participants have the option to enroll in Part D prescription drug plans. Part D premiums are in addition to Medicare Part B supplement premiums and they vary per plan. Taxpayers with a higher MAGI will be required to pay a Medicare Part D surcharge in addition to their plan’s premium. Similarly to Part B premiums, the surcharge will be deducted from Social Security benefits if the participant is receiving them: otherwise, the individual will receive a bill for the monthly surcharge amount. The Part D IRMAA for 2022 is shown in the table below:

If your filing status and yearly income in 2020 was

File individual tax return

File joint tax return

File married & separate tax return

You pay each month (in 2021)

$91,000 or less

$182,000 or less

$91,000 or less

your plan premium

above $91,000 up to $114,000

above $182,000 up to $228,000

not applicable

$12.40 + your plan premium

above $114,000 up to $142,000

above $228,000 up to $284,000

not applicable

$32.10 + your plan premium

above $142,000 up to $170,000

above $284,000 up to $340,000

not applicable

$51.70 + your plan premium

above $170,000 and less than $500,000

above $340,000 and less than $750,000

above $91,000 and less than $409,000

$71.30 + your plan premium

$500,000 or above

$750,000 or above

$409,000 or above

$77.90 + your plan premium

(https://www.medicare.gov/drug-coverage-part-d/costs-for-medicare-drug-coverage/monthly-premium-for-drug-plans)

As a part of Schultz Financial Group’s year-end tax planning process, we review our client’s tax returns and are cognizant of how small adjustments in adjusted gross income can have a large impact on annual Medicare premiums. Contact us to speak with an advisor.

Editors’ Note: This article was originally published in 2020, but has been updated to reflect 2022 data.

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