Medicare Part B premiums are primarily determined by your income, specifically your Modified Adjusted Gross Income (MAGI). This means that individuals with higher incomes typically pay a higher monthly premium for their Medicare Part B coverage.
Understanding Modified Adjusted Gross Income (MAGI)
Your Modified Adjusted Gross Income (MAGI) is calculated from your Adjusted Gross Income (AGI) with certain tax-exempt incomes added back. For Medicare premium purposes, the Social Security Administration (SSA) typically uses the MAGI reported on your tax return from two years prior. For example, your 2024 Medicare premiums are generally based on your MAGI from your 2022 tax return.
Income-Related Monthly Adjustment Amount (IRMAA)
The mechanism by which higher earners pay more for Medicare Part B is known as the Income-Related Monthly Adjustment Amount, or IRMAA. This is an additional amount added to your standard Part B premium. IRMAA applies to both Medicare Part B and Medicare Part D (prescription drug coverage) premiums, though the provided data specifically addresses Part B.
2024 Part B Premiums Based on Income
The monthly premium you pay for Medicare Part B in 2024 depends on your MAGI. The standard premium applies to most beneficiaries, but those with higher incomes will pay an increased amount.
Here's a breakdown of the 2024 monthly Part B premiums based on individual MAGI thresholds:
| Individual Modified Adjusted Gross Income (MAGI) | 2024 Monthly Part B Premium |
|---|---|
| Less than or equal to $103,000 | $174.70 (standard premium) |
| Above $103,000 and less than $397,000 | $559.00 ($174.70 standard + $384.30 additional) |
It's important to note that these are the individual income thresholds. Joint filers have different, higher income thresholds before IRMAA applies and increases.
Key Considerations
- Income Review: The SSA reviews your income annually using tax data. If your income has significantly decreased due to certain life-changing events (like retirement, divorce, or death of a spouse), you may be able to request a new IRMAA determination based on your current income.
- Automatic Adjustment: For most people, Medicare premiums are automatically deducted from their Social Security benefit payments.
