COLA, but Medicare Increase

[RonB474926]

I’m 69, been on Medicare since 65 and Social Security since 67. Just received notice for 2023. The 8.7 COLA is nice, but my Medicare premium increased by 35%. Explanation is because of my 2021 tax report. I have zero earned income and my reported income is from investments (which I didn’t touch). This year’s investments are taking a beating. Having 35% increase in Medicare premium from information in 2021 is disturbing and adding additional stress to my finances. Can this be reviewed by Social Security.

[Tonster521]

@RonB474926 About 15 years ago, the Medicare Program was amended to increase Part B premiums for folks with income above certain thresholds. There is a two year look back probably because the SSA uses Federal Income Tax returns to review everyone's income. My guess is it takes two years to obtain the data. So, the SSA is reviewing 2021 tax returns to determine the IRMAA for 2023. ffred advised of the IRMAA in is reply earlier today. I am linking an article from the CMS that provides the income thresholds and the single /married Part B premiums for 2023 https://www.cms.gov/newsroom/fact-sheets/2023-medicare-parts-b-premiums-and-deductibles-2023-medicar... It should be noted that for most folks, the Part B premium for 2023 decreased from $170.10 to $164.90 or $5.20. However, based on the information you provided, your Part B premium increased from $170.10 to $230.80 or about 35% because your income exceeded the income threshold for IRMAA. 

[WebWiseWoman]

Weird, most of us can't afford the Medicare B increase, much less "investments", so congrats to u for having that! 

Here's what some (most) of us experience: SSI COLA 4-5% (average); Medicare 6-7% (average) annually. Rent 10% post-covid (annually); fuel 30% (annually); food 40% (monthly)...

Just to remind others, not everyone has investments, etc... so appreciate where you are and what you have?

Edit adding: ‘It’s like living in an igloo.’ People are turning off their heat as prices surge 

#StaySafe

[fffred]

@RonB474926    Medicare premiums decreased slightly for 2023. It sounds like you were hit by the IRMAA based on 2021 income. That's the income related monthly adjustment amount.

Income received from investments and other sources besides income from working can affect your Medicare premium through the IRMAA and it can also affect the taxability of your social security benefit.

The fact that any particular investment or account value is subsequently decreased is immaterial. What counts is the income shown on your tax return.

You could consider consulting a tax advisor so as to minimize your income for tax purposes.

Edit to add:. This article (one of many) discusses the IRMAA issue https://thefinancebuff.com/medicare-irmaa-income-brackets.html

This article discusses options if one year’s income was unusually large https://www.aarp.org/retirement/social-security/questions-answers/medicare-premium-irmaa.html