How do I avoid higher Medicare premiums?
Avoid higher Medicare premiums by managing the income used to calculate surcharges or appealing when your income drops. Higher premiums, known as IRMAA (Income-Related Monthly Adjustment Amount), add extra monthly charges to Medicare Part B and Part D if your Modified Adjusted Gross Income (MAGI) from two years prior exceeds $109,000 for singles or $218,000 for married couples filing jointly.
📉 Income Reduction Strategies
- Qualified Charitable Distributions: Donate directly from your IRA past age 70½ to bypass taxable income.
- Tax-Exempt Spacing: Spread large traditional IRA or retirement withdrawals across multiple tax years.
- Roth Conversions Early: Shift funds before Medicare starts to enable tax-free income later.
- Tax-Loss Harvesting: Sell underperforming taxable investments to offset realized capital gains.
🗓 Appeals and Life Events
- File Form SSA-44: Appeal surcharges if you experienced a qualifying life-changing event.
- Work Stoppage: Cite full or partial retirement, layoffs, or reduced work hours.
- Marital Status Change: Report a divorce, annulment, or the death of a spouse.
- Income Property Loss: Document income losses from disasters or theft beyond your control.
What is the income limit to avoid higher Medicare premiums?
To avoid higher Medicare premiums (known as the Income-Related Monthly Adjustment Amount or IRMAA surcharge) in 2026, your modified adjusted gross income (MAGI) must be $109,000 or less for single filers, and $218,000 or less for married couples filing jointly.
How Medicare Calculates Surcharges
- Two-Year Lookback: Your 2026 premiums are based on the tax return you filed for 2024.
- Income Definition: Medicare looks at your Modified Adjusted Gross Income (MAGI), which is your adjusted gross income plus any tax-exempt interest income.
- Impacted Parts: If you earn above the threshold, a surcharge is added to your Medicare Part B and/or Part D (prescription drug) monthly premiums.
2026 First Tier Thresholds
- Single Filers: Up to $109,000 pays the standard Part B premium ($202.90/month); over $109,000 triggers an IRMAA surcharge.
- Married Filing Jointly: Up to $218,000 pays the standard rate; over $218,000 triggers a surcharge.
What triggers higher Medicare premiums?
Higher Medicare premiums are primarily triggered by the Income-Related Monthly Adjustment Amount (IRMAA), which adds a surcharge to Medicare Part B and Part D when your modified adjusted gross income (MAGI) exceeds specific federal thresholds.
Income Thresholds and Lookback
- Two-year lookback: Medicare checks your IRS tax return from two years prior to determine if you owe an IRMAA surcharge (for example, 2026 premiums are based on 2024 tax data).
- Single filers: Surcharges begin if your MAGI crosses $109,000.
- Joint filers: Surcharges begin if your combined MAGI crosses $218,000.
- Maximum impact: Surcharges scale across tiers, pushing Part B monthly costs up to $689.90 for incomes over $500,000 (individual) or $750,000 (joint).
Common Financial Triggers
- Retirement account distributions: Taking large traditional IRA or 401(k) withdrawals, or reaching the age for Required Minimum Distributions (RMDs).
- Investment events: Post-retirement work income, large capital gains from selling a home or real estate, and major stock sales.
- Tax strategy shifts: Executing Roth IRA conversions or realizing high municipal bond interest.
- Inheritances: Withdrawing funds from an inherited IRA.
You can learn more about managing these costs directly through the Social Security Administration or review baseline limits via KFF Open Enrollment FAQs. If you experience a life-changing event like retirement or a drop in income, you can appeal the surcharge using Form SSA-44.
How much is the average Medicare premium per month?
The standard Medicare baseline cost for most beneficiaries is $202.90 per month. However, because Medicare is divided into different parts, your total monthly premium depends on which plans you choose and your income level.
A breakdown of the average monthly premiums for each part of Medicare outlines these costs:
🏥 Medicare Part A (Hospital Insurance)
- Average Premium: $0 per month for roughly 99% of enrollees.
- Details: If you or your spouse paid Medicare taxes while working for at least 10 years (40 quarters), you receive Part A premium-free. If you do not qualify, the premium can cost up to $565 per month.
🩺 Medicare Part B (Medical Insurance)
- Standard Premium: $202.90 per month.
- Details: The vast majority of beneficiaries pay this standard rate. If your modified adjusted gross income from two years prior is higher than $109,000 (single) or $218,000 (joint), you will pay an Income-Related Monthly Adjustment Amount (IRMAA) surcharge, which can bring the total monthly cost up to $689.90.
💊 Medicare Part D (Prescription Drug Plans)
- Average Premium: Approximately $34.50 per month.
- Details: Part D plans are sold by private insurance companies, meaning premiums vary widely depending on your specific plan and location. Like Part B, high earners are subject to additional IRMAA surcharges ranging from an extra $14.50 to $91.00 per month.
⚡ Medicare Part C (Medicare Advantage)
- Average Premium: Approximately $14.37 per month.
- Details: Many Medicare Advantage plans offer a $0 monthly premium, though you must continue to pay your standard Part B premium to remain enrolled.
🩹 Medigap (Medicare Supplement Insurance)
- Average Premium: Typically ranges from $100 to $300+ per month.
- Details: These private plans supplement Original Medicare (Parts A and B) to help pay for out-of-pocket expenses. Prices vary greatly depending on your age, location, and the level of coverage you choose.
For official updates and personalized cost lookups, you can check the Medicare Costs Portal or review the detailed CMS Medicare Costs Guide.
Who is exempt from paying Medicare premiums?
Most people do not pay a monthly premium for Medicare Part A if they or their spouse worked and paid Medicare taxes for at least 10 years (40 quarters).
Premium-Free Medicare Part A
You get Part A (hospital insurance) without paying a monthly premium if you meet these rules:
- You are 65 or older and eligible for Social Security or Railroad Retirement Board benefits.
- You are under 65 and have received Social Security or Railroad Retirement Board disability benefits for 24 months.
- You have End-Stage Renal Disease (ESRD) and meet specific work requirements.
- You worked enough quarters under Medicare payroll taxes (FICA).
Who Gets Help Paying Other Premiums (Part B, Part D)
While most people must pay the standard monthly premium for Medicare Part B (medical insurance), certain low-income individuals are exempt from these costs through financial assistance programs:
- Qualified Medicare Beneficiary (QMB) Program: This program helps people with limited income and resources by paying their Medicare Part A and Part B premiums, deductibles, coinsurance, and copayments.
- Other Medicare Savings Programs (MSPs): Programs like SLMB (Specified Low-Income Medicare Beneficiary) pay the Part B premium for qualifying low-income individuals.
- Extra Help Program: Helps eliminate or lower Part D (prescription drug) plan premiums and costs for individuals who qualify based on income.
Medicare Part B Premium is Very High, How To Lower It
What are the income brackets for Medicare premiums in 2026?
For 2026, higher-income Medicare beneficiaries pay an extra charge called the Income-Related Monthly Adjustment Amount (IRMAA) if their modified adjusted gross income (MAGI) from 2024 exceeds $109,000 for single filers or $218,000 for married couples filing jointly.
2026 IRMAA Brackets and Premiums
| Single Filers (2024 MAGI) | Married Filing Jointly (2024 MAGI) | Part B Monthly Surcharge | Total Part B Monthly Premium | Part D Monthly Surcharge |
|---|---|---|---|---|
| ≤ $109,000 | ≤ $218,000 | $0.00 | $202.90 | $0.00 |
| $109,001 – $137,000 | $218,001 – $274,000 | $81.20 | $284.10 | $14.50 |
| $137,001 – $171,000 | $274,001 – $342,000 | $202.90 | $405.80 | $37.50 |
| $171,001 – $205,000 | $342,001 – $410,000 | $324.60 | $527.50 | $60.40 |
| $205,001 – $499,999 | $410,001 – $749,999 | $446.30 | $649.20 | $83.30 |
| ≥ $500,000 | ≥ $750,000 | $487.00 | $689.90 | $91.00 |
Note: Part D surcharges are paid in addition to your chosen private prescription drug plan's standard monthly premium.
Which Medicare is free for seniors?
Medicare Part A (Hospital Insurance) is free of a monthly premium for most seniors who worked and paid Medicare taxes for at least 10 years (40 quarters).
Medicare is not entirely free, and no single part covers everything without other potential out-of-pocket costs. Here is how the costs break down by part:
Premium-Free vs. Paid Parts of Medicare
- Medicare Part A (Hospital Insurance): $0 monthly premium for about 99% of seniors who have enough work history. However, it still has a deductible ($1,736 per benefit period in 2026) and coinsurance for long hospital or skilled nursing stays. If you lack the required work credits, you can buy Part A for a monthly fee.
- Medicare Part B (Medical Insurance): Not free. Most people pay a standard monthly premium ($202.90 in 2026), plus an annual deductible and 20% coinsurance for most doctor services.
- Medicare Part C (Medicare Advantage): Sometimes $0 plan premium. These are private plans, and some feature a $0 additional monthly charge, but you must still pay your standard Part B premium.
- Medicare Part D (Prescription Drug Coverage): Not automatically free, though private plan prices vary.
How to Get Help With Costs
- Medicare Savings Programs (MSPs): If you have a low income, your state may pay for your Part B premiums, deductibles, and co-pays.
- Extra Help Program: Low-income seniors can get assistance with prescription drug costs through the federal Extra Help program, which lowers or eliminates Part D premiums and deductibles.
What are the four things Medicare doesn't cover?
Original Medicare does not cover four major categories of health needs: routine dental care, eyeglasses and routine eye exams, hearing aids and exams, and long-term (custodial) care.
Key Uncovered Services
- Routine Dental Care: Original Medicare excludes cleanings, fillings, tooth extractions, root canals, and dentures. It only covers very limited, specific procedures tied to another medical treatment (such as a dental exam before certain organ transplants or jaw reconstruction).
- Vision Care: Routine eye exams, eyeglasses, and contact lenses are not covered. Medicare does cover medically necessary treatments for specific eye diseases like cataracts or glaucoma, but not the glasses needed afterward.
- Hearing Care: Routine hearing tests, hearing aid fittings, and hearing aids themselves are excluded from Original Medicare. Diagnostic exams are covered only if ordered by a physician to evaluate a medical problem.
- Long-Term Care: Custodial care—such as help with daily activities like bathing, dressing, eating, or using the bathroom—is not covered when it is the main kind of care you need. Medicare Part A only covers short-term skilled nursing care after a qualifying hospital stay.
Other common exclusions include care received outside the United States, cosmetic surgery, and routine foot care. You can find comprehensive details on Original Medicare Coverage Exclusions directly from Medicare.gov.
Does social security count as income towards Medicare premiums?
Yes, a portion of your Social Security benefits can count as income toward determining your Medicare premiums, but only the taxable portion is included.
Medicare premiums are calculated based on your Modified Adjusted Gross Income (MAGI). For Medicare purposes, your MAGI is your Adjusted Gross Income (AGI) plus any tax-exempt interest (such as municipal bond interest).
How Social Security Affects Your Premiums
- The Taxable Portion Counts: When you file your federal taxes, depending on your overall "combined income," up to 85% of your Social Security benefits may be considered taxable income. This taxable amount is included in your AGI and directly flows into your Medicare MAGI calculation.
- The Non-Taxable Portion is Excluded: The remaining percentage of your Social Security benefit that is not subject to federal income tax is entirely excluded and does not count toward your Medicare calculation.
Why This Matters: IRMAA
Most people pay the standard premium for Medicare Part B ($202.90 per month) and a baseline premium for Part D. However, if your total MAGI—including that taxable Social Security portion—crosses a certain threshold, you will be hit with a high-income surcharge called the Income-Related Monthly Adjustment Amount (IRMAA).
- The Thresholds: For Medicare premiums, the Social Security Administration uses a two-year tax lookback. Your premiums are determined by the MAGI reported on your tax return from two years prior.
- The Cliffs: IRMAA is a "cliff" surcharge. If your taxable Social Security pushes you even $1 over the threshold, your monthly premium for both Part B and Part D will jump to the next bracket.
A Note on Premium Deductions
If you are already collecting Social Security benefits, Medicare will automatically deduct your Part B (and sometimes Part D) premiums directly from your monthly Social Security check before it is deposited. Even though you do not "see" this money, the gross amount of your benefit is still used by the IRS to figure out what portion is taxable and subsequently counted toward future Medicare adjustments.
Will senior citizens have to pay more for Medicare in 2026?
Yes, senior citizens will pay more for Medicare in 2026 because standard monthly premiums and deductibles are increasing across the program.
As reported by CNN Politics, these rising costs will consume a noticeable portion of the yearly Social Security cost-of-living adjustment.
Part B Costs (Doctors and Outpatient Care)
- Monthly Premium: Increases by $17.90 to $202.90, crossing the $200 mark for the first time.
- Annual Deductible: Rises to $283, an increase of $26 from the previous year.
- Higher Income Surcharges (IRMAA): Beneficiaries with higher incomes will pay extra, with total monthly costs reaching up to $689.90 for top brackets.
Part A Costs (Inpatient Hospital Care)
- Inpatient Deductible: Rises by $60 to $1,736 per benefit period.
- Monthly Premium: For individuals who do not qualify for premium-free Part A, the full monthly cost rises to $565.
Part D Costs (Prescription Drugs)
- Out-of-Pocket Cap: Seniors will benefit from a hard annual cap of $2,100 on covered prescription drugs.
- National Base Premium: Averages around $38.99, though individual plan prices vary.
You can view the complete breakdown of official figures in the Official Medicare Costs Guide.